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Presentation of key findings
Kate Purcell, Peter Elias, Rhys Davies and Nick Wilton
London, 27th October 2005
The Class of ’99:The Class of ’99:a study of the early labour market a study of the early labour market experiences of recent graduatesexperiences of recent graduates
The University of the West of England
The issues we sought to addressThe issues we sought to address
Are graduates obtaining employment which uses their HE skills and knowledge?
Which graduates have difficulty in obtaining appropriate employment?
How has the move to mass higher education impacted upon the labour market?
Has the expansion of higher education led to greater equality of opportunity?
Is current policy to expand higher education justified in the light of graduates’ experiences?
The researchThe research
Postal and web survey of 1:2 of all domestically-domiciled students who gained a first degree or diploma from a sample of 38 UK HEIs (same HEIs which provided information about their 1995 graduates for an earlier study)
Follow-up telephone interviews with selected sub-sample
Data collected between February 2003 and April 2004 – most survey data in May 2003
0
2
4
6
8
10
12
14
16
18
20
Inner
Lond
on
Outer L
ondo
n
Sout
h Eas
t
Sout
h Wes
tWale
s
East
Angli
a
East
Midlan
ds
West M
idlan
ds
North
Wes
t
Yorks
and H
umb
North
Scot
land
N. Ire
land
Irish R
epub
lic
Elsew
here
%
Lived immediately before studying for your 1999 qualification
Where you were first employed after completing your 1999 course
Where currently employed/live
Regional composition of sample Regional composition of sample
0
5
10
15
20
25
30
35
40
45
50
Managerialand
professionaloccupations
Intermediateoccupations
Smallemployersand ownaccountworkers
Lowersupervisory
and technicaloccupations
Semi-routineand routineoccupations
Neitherparent in paidemployment
Male
Female
Parental background of sample Parental background of sample (NSSEC)(NSSEC)
by genderby gender
0
10
20
30
40
50
60
70
Statecomprehensive/Sixth
form college
State grammar school Fee paying school Other
%
Old University
1960sUniversity
Post-1992University
HE College
Type of school attended, Type of school attended, by type of institution attended by type of institution attended
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Old University New University
0 to 9 points 10 to 19 points 20 to 29 points 30 points or more
A level scores (or equivalent) of A level scores (or equivalent) of graduates who completed their graduates who completed their
degrees under the age of 25, by type degrees under the age of 25, by type of HEI of HEI
0 2 4 6 8 10 12 14 16
Social Sciences
Other vocational
Natural Sciences
Medicine & Related
Maths & Computing
Law
Languages
Interdisciplinary
Humanities
Engineering
Education
Business Studies
Arts
per cent
Female
Male
Subject of study, by gender Subject of study, by gender
Reported use and usefulness of career Reported use and usefulness of career information and guidance sources by information and guidance sources by
graduates graduates
0
10
20
30
40
50
60
70
80
90
Recruitment Agencies Networks Publications Careers AdvisoryServices
Per
cen
t
Not useful
Useful
MaleMale FemaleFemale
Full-time related to long-term career Full-time related to long-term career plansplans
69.569.5 65.765.7
Part-time related to long-term career Part-time related to long-term career plansplans
1.51.5 4.74.7
In full-time employment (other)In full-time employment (other) 16.616.6 17.617.6
In part-time employment (other)In part-time employment (other) 1.71.7 3.13.1
Self-employedSelf-employed 4.24.2 3.03.0
Postgraduate studyPostgraduate study 6.56.5 8.38.3
Unemployed and seeking workUnemployed and seeking work 3.23.2 1.91.9
Out of the labour force/not seeking Out of the labour force/not seeking workwork
0.80.8 1.71.7
OtherOther 2.22.2 3.23.2
Situation at time of survey (2003/04), Situation at time of survey (2003/04), by gender by gender
0 5 10 15 20 25 30 35
Other
Other public services
Education
Business services
Banking, finance, insurance
Information and communications sector
Transport and tourist services
Distribution, hotels, catering
Construction
Electricity, gas, water supply
Manufacturing
Agriculture, mining, quarrying
per cent
Female
Male
Sector of employment at time of Sector of employment at time of survey, by gender survey, by gender
Occupation held at time of surveyOccupation held at time of survey
05
101520
2530354045
Managers &Senior
Officials
ProfessionalOccupations
AssociateProfessional &
TechnicalOccupations
Administrative& secretarialOccupations
Other
Male
Female
%
The SOC(HE) classificationThe SOC(HE) classification
Traditional graduate occupations
Modern graduate occupations
New graduate occupations
Niche graduate occupations
Non-graduate occupations( For more details, see www.warwick.ac.uk/go/glmf )
0
5
10
15
20
25
30
35
40
1980 2000 1980 2000
Females Males
% o
f tot
al e
mpl
oyee
s in
em
ploy
men
t
Niche graduate job
New graduate job
Modern graduate job
Traditional graduate job
The changing structure of graduate The changing structure of graduate occupations in the UK, 1980 - 2000occupations in the UK, 1980 - 2000
Source: New Earnings Survey Panel Dataset 1975-2000
Source: Unpublished estimates and projections of employment: Warwick Institute for Employment Research / Cambridge Econometrics, 2005
Changing structure of occupations, UK, Changing structure of occupations, UK, 1984-20141984-2014
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000
Year
Tho
usan
ds
Major Groups 1, 2 and 3
Major Groups 4, 5, 6, 7, 8 and 9
This study
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47
months following graduation
per
cen
t
Employed (1995 graduate)
Employed (1999 graduate)
Unemployed (1995 graduate)Unemployed (1999 graduate)
Study (1995 graduate)
Study (1999 graduate)
Comparison of early career Comparison of early career trajectories oftrajectories of
‘‘95 and ‘99 graduates95 and ‘99 graduates
0
10
20
30
40
50
60
70
80
90
100
months following graduation
per
cent
of a
ll in
em
ploy
men
t
Non-graduatejob
Nichegraduate job
New graduatejob
Moderngraduate job
Traditionalgraduate job
The occupational evolution of The occupational evolution of employment among ‘99 employment among ‘99
graduates graduates
0
5
10
15
20
25
30
35
40
45
50
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42
Months since graduation
% o
f e
mp
loy
ed
gra
du
ate
s in
no
n g
ra
du
ate
jo
bs
Movement of ‘95 and ‘99 graduates Movement of ‘95 and ‘99 graduates out of non graduate jobsout of non graduate jobs
1995 graduating cohort
1999 graduating cohort
0%
10%
20%
30%
40%
50%
60%
70%
80%
months following graduation
per
cen
t
Arts
Humanities
Languages
Law
Social Sciences
Mathematics & Computing
Natural Sciences
Medicine & Related
Engineering
Business Studies
Education
Exit of ’99 graduates from non-Exit of ’99 graduates from non-graduate employment by degree graduate employment by degree
subjectsubject
SOC(HE) distributions of ‘95 and ‘99 SOC(HE) distributions of ‘95 and ‘99 graduates 3.5 and 4 years after graduates 3.5 and 4 years after
graduationgraduation
0
5
10
15
20
25
Traditionalgraduate job
Moderngraduate job
New graduatejob
Niche graduatejob
Non-graduatejob
per c
ent
1995 1999
Factors considered relevant by ’99 Factors considered relevant by ’99 graduates in obtaining current jobgraduates in obtaining current job
SOC (HE) category (%)
Traditional Modern New NicheNon-
graduateAll in
employment
Possession of degree 92 83 79 63 47 74
Subject studied 73 57 50 39 29 50
Class of degree obtained 48 33 34 24 14 31
Recognition by professional body of undergraduate course
28 18 20 11 5 17
Postgraduate qualification 34 15 11 8 8 15
Professional qualification gained subsequently
34 10 13 10 8 15
Experience in current organisation in other job
16 16 17 21 16 17
Employment experience in another organisation
25 31 40 37 40 36
A comparison of the job quality of A comparison of the job quality of ‘95 and ‘99 graduates‘95 and ‘99 graduates
0
5
10
15
20
25
30
0 1 2 3 4 5 6
Index of job quality
1995 Graduates
1999 Graduates
BetterWorse
Who is in a non graduate job four Who is in a non graduate job four years after graduation?years after graduation?
Employment in non-graduate occupations varies by: Subject (Medicine 5%, Arts/Humanities 20%
+) Degree class (1st 10%, 3rd 25%) HE type (Old 14%, HE College 23%) Unemployment since graduation (none 15%,
6 months 31%) Geographical mobility (Move 14%, Stay 19%) Gender and age Work experience while studying
Are the earnings of graduates Are the earnings of graduates declining?declining?
Graduate earnings premium in the UK is higher than in many other countries – is it holding up or is it falling?
Limited evidence so far indicates that there may have been a decline in the premium – but how can we tell when we only study graduates?
Compare earnings of 1995 graduates in 1998/99 with 1999 graduates in 2003/04:
adjust for earnings inflation;
adjust for longer time spent in labour market by 1999 graduates.
Other recent research shows similar picture (O’Leary and Sloane 2005; McGuiness and Doyle 2005). Nevertheless, the return to a degree remains substantial.
1995 graduates in 1998/99
1999 graduates in 2003/04
% growth
Mean Median Mean Median Mean Median
Males£21,585
£20,163
£25,875
£24,062 20 19
Females£18,441
£17,611
£22,479
£21,524
22 22
Total£19,813
£18,515
£23,754
£22,301
20 22Between December 1998 and May 2003, UK index of average earning grew by 25%
After adjusting for the greater length of time spent in the labour market by the 1999 cohort, estimate that the earnings of the 1999 cohort are lagging behind those of the 1995 cohort by about 10%
What factors are associated with variation What factors are associated with variation in earnings and the gender pay gap?in earnings and the gender pay gap?
We conducted a detailed multivariate analysis of the variations in earnings of graduates in full-time employment in 2002/03 (excluding those aged 38 and over).
We tested for variations associated with social class, entry qualifications, class of degree, post graduate qualifications, type of institution, age, gender, a range of job characteristics and family situation
What factors are strongly related to What factors are strongly related to variations in earnings graduates working variations in earnings graduates working
full-time? full-time? Working hours (+1% per additional hour) Degree required by employer (18% addition) Sector (ICT, banking, business services: +4% to
+12% more than other sectors) Age (3% more per additional year of age) Disability (7% less) Type of job held (-12% to -17% for nongraduate
job)
Class of degree (15% less for a third class) Subject studied (Arts -6%, maths & computing +7%,
medicine and related +20%: relative to social sciences)
Lives in London and SE (+23% for Inner London, +17% for Outer London)
Contractual status (-13% if self employed) Gender context at work (-13% if works exclusively
with women) Gender (5% less if female)
What factors are strongly related to What factors are strongly related to variations in earnings? (contd.)variations in earnings? (contd.)
0
5
10
15
20
25
30
35
40
45
…almostexclusively by
men
…mainly by men …by a fairlyequal mixture ofmen and w omen
…mainly byw omen
…almostexclusively by
w omen
…only by me
Male
Female
Response to statement ‘In my Response to statement ‘In my workplace, my type of job is done …’workplace, my type of job is done …’
Average earnings by gender Average earnings by gender context at work and gender of context at work and gender of
respondentsrespondents
£-
£5,000
£10,000
£15,000
£20,000
£25,000
£30,000
…almost exclusivelyby men
…mainly by men …by a fairly equalmixture of men and
women
…mainly by women …almost exclusivelyby women
In my workplace, my type of work is done...
Ave
rag
e an
nu
al g
ross
ear
nin
gs
Men
Women
Why do graduate women in their early Why do graduate women in their early careers earn less than similarly-careers earn less than similarly-
qualified males?qualified males? Less investment in human capital by women? Different kinds of skills – valued less? Discontinuous employment? Part-time
working? Different values and attitudes to career
development and work/life balance? Underachievement? Different ambitions or
expectations? Rational choice now to future work/life paths? Discrimination by employers?
Age profiles of hourly earnings by Age profiles of hourly earnings by gender and qualifications, 1999 - gender and qualifications, 1999 -
2003 2003
0
2
4
6
8
10
12
14
16
18
20
21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50
Age
Ho
url
y e
arn
ing
s (
£/h
r)
Male, first degree
Female, firstdegreeMale, A levels
Female, A levels
Source: Labour Force Surveys, 1999 - 2003.
Moving from ‘accounting for’ to ‘explaining’ Moving from ‘accounting for’ to ‘explaining’ the gender pay gapthe gender pay gap
Implications of cumulative gendered ‘choices’ Are differences employment-related or reflecting
wider differences in values and aspirations Work/life balance and ‘the sex/gender dilemma’ Practical obstacles to equality of opportunity in
employment Gender stereotypes at work as constraints Discrimination, harassment and the challenge of
being ‘a woman in a man’s world’
The financial legacyThe financial legacy
81% of young graduates had repayable debt, mean £6,205, median £5,500.
Term time employment more prevalent among lower social class groups.
Term time employment associated with poorer degree performance.
Those who indicated that their options had been limited by debt were: less likely to undertake further study; more likely to be employed in non-
graduate jobs.
Debts and further study - 2(i)sDebts and further study - 2(i)s
0%
5%
10%
15%
20%
months following graduation
per c
ent
No Debt
Debt - No Problem
Debt - Problem
Debts and non-graduate jobs – Debts and non-graduate jobs – 2(i)s2(i)s
0
10
20
30
40
50
60
70
months following graduation
per
cen
t
No Debt
Debt - No Problem
Debt - Problem
Paid employment during course Paid employment during course and degree resultand degree result
0
10
20
30
40
50
60
1 2(i) 2(ii) 3 Pass/Diploma Ordinary degreedegree classification
per
cen
t
no work
vac only
term only
both
1999 graduates’ satisfaction with 1999 graduates’ satisfaction with career 4 years on, by gendercareer 4 years on, by gender
0
10
20
30
40
50
60
Very satisfied Reasonablysatisfied
Not very satisfied Dissatisfied
per
cent
Male
Female
Extent to which respondents would, Extent to which respondents would, with hindsight, do degree again, by with hindsight, do degree again, by
gender gender
0
10
20
30
40
50
60
70
Do the same courseat the same place
Do a similar course ata different place
Do a different course Choose not to enterhigher education
%
Male
Female
SummarySummary Proportion of graduates in the labour force will continue to rise steadily, at least until 2020.
The demand for graduate skills and knowledge is projected to grow.
Shortages of high level technical skills are likely to continue (esp. medicine).
Graduates are likely to displace non graduates in competition for ‘new’ graduate jobs.
Gendered boundaries in graduate employment becoming less distinct – work/life balance policies will become increasingly important.
The extension of HE participation has, so far, disproportionately benefited those from relatively privileged backgrounds – which presents a major challenge for the policy community.
To find out more about this and the To find out more about this and the team’s other research on the graduate team’s other research on the graduate labour market, check out the following labour market, check out the following
links:links:
www.dfes.gov.uk/research/www.dfes.gov.uk/research/...?...? www.delni.gov.uk/statistics/www.delni.gov.uk/statistics/ www.warwick.ac.uk/ierwww.warwick.ac.uk/ier www.uwe.ac.uk/bbs/research/esruwww.uwe.ac.uk/bbs/research/esru// www.hecsu.ac.ukwww.hecsu.ac.uk
The University of the West of England
