Time to ban the graduate only job? The era of the indiscriminate expansion of higher education is at an end

January 24, 2022

It increasingly looks like the end of an era for Britain’s bloated higher education sector. For the past 30 years parents and young people have seen higher education as the only route to safety and success, as a growing number of mainstream jobs became graduate only. The economist Stephen Davies puts it neatly: higher education shifted from being a consumption good to an investment good. 

Yet the Government’s welcome new measures to raise minimum standards in the sector, announced last week, contain an extraordinary and revealing figure, a single number which suggests we have reached a turning point. In order to avoid sanctions for high numbers of students not continuing or completing courses and not going on to decent jobs, colleges will have to show that 60 per cent of students end up in professional jobs. Just 60 per cent! And this is as part of a set of measures designed to raise standards and end the “bums on seats” reflex of some institutions, which are sometimes better at marketing their courses than producing well educated students. Universities are clearly producing too many students for too few graduate jobs, notwithstanding the rise and rise of the graduate only job. Around one third of graduates are not in graduate employment five to 10 years after graduating, and the graduate income premium has declined to almost nothing for less prestigious universities. 

This was the inevitable consequence of the helter-skelter expansion of the last 30 years based around a single classical model of full-time, academic-generalist, usually residential, higher education aimed mainly at 18 year olds. The result has been lots of hugely expanded university campuses yet too many academically-trained students without useful skills or decent jobs and the withering of technical education with the consequent skills crisis in the “missing middle”. This has political consequences too. What Peter Turchin has called elite over-production produces two sets of disgruntled people, the people who didn’t go to university at all who feel like losers when all the best jobs are reserved for graduates and the bottom part of the graduate class who are not getting the well paid professional jobs they expected. This problem is not going away because the number of top jobs is inherently limited and there has been a marked slow-down even in the broader category of professional and managerial jobs. 

This means the break up of the classical higher education monolith with some of the post-1992 universities likely to revert to something like their old polytechnic status—maybe called practical or technical universities—offering higher vocational and technical courses (as many already do) on a more flexible, sometimes part-time basis, to a broader age cohort of students. After all as recently as the late 1980s when only about 20 per cent of school leavers went to university most professional people did not have degrees and completed on the job training combined with part-time study. 

Moreover, employers have realised in recent years that the old signalling system that meant someone with a degree had a high level of general academic ability has broken down. There is a switch to hiring more school leavers underpinned by the Government’s lifetime skills guarantee and higher investment in Further Education colleges. Parents, too, no longer assume that a university degree is a ticket to security according to recent opinion polls, (though many young people still like the idea of three years away from home subsidised by the tax-payer). 

The Government’s attempt to squeeze out “mickey mouse” courses with high-drop out rates—and this is not just about surfing studies, 8 university computing courses have drop-out rates above 40 per cent—will be attacked as denying opportunity to the disadvantaged. But how is it helping disadvantaged young people to leave them with high debt and valueless qualifications? 

The Government should now go further and consider banning employers from advertising graduate only jobs. There are many capable people who did not do well in school exams and, in recent years, have found themselves squeezed out of professional careers in which they could have flourished. Clearly people still require key skills but these can usually be acquired on the job and through routes other than full time study, as used to be the case.

In the longer run this means fewer traditional universities and a much more varied post-school education and training menu. One good example is the New Model Institute for Technology and Engineering in Hereford, a novel engineering college, that hopes to attract nearly 500 students both locally and nationally in the next few years with its hands-on mission to create actual engineers not just engineering graduates. And this is even before considering how online higher education is bound to take off. Greg Mankiw, of Harvard University, writer of the top selling economics textbook has put all his lectures online. Everyone with the ability and the intellectual curiosity should be encouraged to expand their minds at university, using a mix of online and in-person study, but not necessarily at age 18. Many more should go in their late 20s, 30s, 40s and 50s, after a period working.

The UK is good at higher education and we need our top research universities to flourish, and we must continue to attract big international student flows. But we have expanded a certain kind of traditional university too indiscriminately, and been far too focused on school leavers. We are now paying the price. The shake-out will be painful for some but we are heading towards a better place for students and for both our economy and politics. The golden age of British university expansion is at an end, as that figure of 60 per cent has underlined.


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