In the UK, research on higher education has tended to focus on factors associated with admission to university while, only a handful of studies have examined the labour market outcomes of students following university. The majority of studies which have examined the labour market outcomes of students following university have focused on the returns to having a degree and how this varies by factors such as gender, subject of study and institution. The results of these studies have shown that graduates receive a significantly higher wage than non-graduates. The returns to having a degree vary with the subject of study and type of institution attended, however, with students who studied medicine, mathematical and computer sciences or law and those who attended more elite institutions obtaining the highest returns to having a degree.
A further dimension of labour market inequality among graduates relates to the type of job obtained following graduation. In particular, there has been increasing concern about the number of students leaving higher education who do not find jobs for which a degree is necessary. The extent of over-education may be measured using the occupations of the jobs obtained by graduates and using this criterion around 20 percent of graduates do not find jobs for which a degree is usually necessary. Although some studies have sought to explain over-education as a result of individual differences in skills, the extent of over-education among graduates can be related to wider patterns of economic change. Research has shown that over the last several decades there has been a polarisation in the nature of employment with an increase in the number of jobs at both the top and the bottom of the occupational hierarchy and a decline in intermediate occupations. Occupational changes in the labour market have been accompanied by a rise in wage inequality. Although wages vary within occupations to a greater degree than they do between occupations, all of the rise in wage inequality in the UK over the last several decades can be explained by changes taking place between occupations (Williams 2012).
Although the nature of the labour market that students enter after graduation has changed significantly over the last several decades little research has examined changes in the type of jobs obtained by students leaving higher education. The Destination of Leavers from Higher Education (DLHE) survey can be used, however, to describe changes in the types of job obtained by students leaving higher education. The DLHE is carried out with all students leaving higher education approximately six months after they complete their course. The survey asks respondents for their current activity and, if employed, collects information on the type of job.
The figure below shows the variation in the proportion of first degree respondents in employment who were working in each of the nine major occupational groups, separately by gender and age group for the cohorts of students who left university between 2006 and 2012. The figure shows that in each year between 50 and 60 percent of 21 to 24 year old and around 70 percent of 25 to 29 year old graduates were employed in either professional or associate professional occupations. The most notable change in the type of occupations in which graduates were working is the steady decline in the proportion finding jobs in administrative and secretarial occupations. The decline in the number of graduates working in administrative and secretarial occupations over the period has been concentrated mainly among women, with the percentage of 21 to 24 year old women employed in administrative and secretarial occupations falling from 20 percent in 2006 to around 12 percent in 2012.
Change from 2006 to 2012 in the occupations in which first degree leavers were employed (as a percentage of all those in employment) separately by gender and age group.
The corresponding figure for postgraduate students is shown below. For postgraduates, the figure shows that at least 90 percent of postgraduate leavers who were in employment were employed in jobs in the top three occupational categories (managers, professional, associate professional and technical). The figure also shows that there has been a steady decline, however, in the proportion of postgraduate students working in professional jobs and a rise in the proportion working in associate professional and technical occupations. The rise in postgraduates working in associate professional jobs suggests either that postgraduates are ‘bumping down’ in the labour market because they can’t get professional jobs or that ‘up-skilling’ has increased the skills needed to do associate professional jobs. What is clear, however, is that the chances of getting a professional job are much higher for postgraduate students in comparison to undergraduates. The introduction of higher tuition fees for undergraduate students has been accompanied by a number of steps aiming to ensure that young people from disadvantaged backgrounds are not excluded from going to university. In contrast, there has been no attempt by government to offset the effect on students from different socioeconomic backgrounds of rising fees for many postgraduate courses. Given that postgraduate degrees are now needed for many professional jobs, this is likely to limit the extent to which the expansion of higher education will increase levels of social mobility in the UK.
Change from 2006 to 2012 in the occupations in which postgraduate degree leavers were employed (as a percentage of all those in employment) separately by age group and gender