UK graduate over-qualification problem

  7th September 2015       Private: Bond Williams
 Company News, Employment, Human Resources

Following the recent GCSE and A-level results, CIPD has called for an education funding review and a national debate about how to create more high-skilled jobs. They claim that graduate over-qualification is reaching saturation point.

According to a new report commissioned by the CIPD, the professional body for HR and people development, the UK has too many over-qualified graduates entering non-graduate jobs. This creates an unnecessary debt burden for too many young people entering the labour market.

The increasing number of graduates has significantly outstripped the creation of high-skilled jobs. This causes negative situations such as employers using degrees as a recruitment requirement for traditionally non-graduate roles, with no change to the skill level. Many graduates are simply replacing non-graduates in less demanding jobs, or entering jobs where the demand for graduate skills is non-existent or falling. This trend has particularly affected occupations where apprenticeships have been historically important, such as manufacturing.

In comparison to other countries:
– The UK has nearly the highest graduation rate at 54%, second only to Iceland. Germany has a graduation rate of just 31%
– The UK has 58.8% of graduates in non-graduate jobs, a percentage exceeded only by Greece and Estonia. In contrast, Germany, the Netherlands and Slovenia, with a history of strong vocational training, have 10% or less of graduates in non-graduate jobs

Peter Cheese, the Chief Executive of the CIPD, commented, “The assumption that we will transition to a more productive, higher value, higher skilled economy just by increasing the conveyor belt of graduates is proven to be flawed. This situation is unsustainable given that the Government estimates that 45% of university graduates will not earn enough to repay their student loans.”

This report highlights the importance for the UK to take stock of whether our higher education system is delivering desired returns for both graduates and for businesses.

The CIPD offers solid guidance for employers, advising them to review their recruitment practices to ensure that they are not using a degree as an unnecessary in the recruitment screening process and to work closer with schools and colleges to build more routes into work for young people, including school leaver programmes, traineeships and apprenticeships. Investing in leadership and workforce development to create more opportunities for all employees to build and fully utilise their skills will always have a knock on effect in boosting productivity, so all employers would be wise to investigate areas that they could improve.

Private: Bond Williams


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