Graduates 'too good for the job'

March 28, 1997

MORE THAN a third of graduates in the United Kingdom are "over educated" and expansionist higher education policies should be checked, a team of economists argued this week.

Peter Dolton and Anna Vignoles of Newcastle University told delegates at the Royal Economic Society's conference in Stoke-on-Trent that as many as 40 per cent of graduates may be overqualified for first jobs.

Their paper adds: "Even six years after graduation, 30 per cent of our sample were overeducated. And given the rising participation rate in the 1980s and 1990s and the support for continued expansion of higher education, this finding has significant policy implications."

The findings give strength to a growing body of controversial research findings suggesting that the United Kingdom is heading for an oversupply of graduates.

The Department for Education and Employment provoked anger from the academic community when it told Sir Ron Dearing's inquiry into higher education that the expansion of student numbers should be capped.

Research from Warwick University, said the DFEE, had shown that graduate supply will soon outstrip demand.

The new paper, Overeducation Duration, followed one from the same authors in 1996, The Incidence and effects of Overeducation in the Graduate Labour Market.

They have identified an upward trend in the incidence of "overeducation" since the 1960s, and have inferred that as the market is offered more graduates, the proportion of overeducated graduates will rise, and a growing number will never make the transition to a "graduate job".

The 1996 paper said: "Increasing the proportion of graduates in the economy may not automatically lead to a high-skill, high-wage work force."

Ms Vignoles stressed that the findings were based on 1980s graduates, and that further study was needed.

"The 1980s was the latest data we had. The historical notion of the graduate job is changing and we need to get a handle on that."

She also suggested the findings had major implications in the tuition fees debate.

"From the point of view of the individual graduate, investing in a degree could have serious implications. The return on their investment could be very low. The argument that the financial burden on the student should be increased because the private financial benefits of a degree are quite high needs closer inspection."

The arguments of Ms Vignoles and Professor Dolton were given further weight by Peter Sloane of Aberdeen University, who told delegates that up to 30 per cent of graduates were overeducated. His paper, The Incidence and Consequences of Graduate Overeducation in Britain, was based on the British Household Panel and had a similarly strong policy message.

He said: "There is evidence that the rate of return to those who are overeducated has diminished. We have to be very careful about expanding higher education at such a rapid rate. We may need to think in terms of the quality of people going into higher education - there is no point putting people through the system who can't cope with it."

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