Late last year the mainstream media picked up on the graduate un/under-employment story. At Grattan we have been doing a bit more work to see what is going on.
One of the things we wanted to look at whether the poor employment outcomes were driven by more graduates, as the 2009 and onwards enrolment boom students finish their courses, or a declining labour market, or both.
We have published completions data, but there is no published time series of the number of recent graduates with jobs. What we’ve done is taken the proportion of recent graduates with full-time jobs in the Graduate Destination Survey as a share of the completions number. To the extent that the GDS is an imperfect sample our numbers are likely to be a little wrong, but I doubt this will affect the trend.
As can be seen in the slide below, both supply and demand factors are affecting outcomes. The graduate labour market peaked in 2007, when nearly 61,000 new bachelor graduates found (or already had) full-time jobs. In 2013 and 2014, just over 52,000 new bachelor graduates had full time jobs about four months after completing their degrees.
There seem to be two shocks to the employment market. The first was the onset of the global financial crisis, with was felt most strongly for the 2008 completing students, with a decline of 7 per cent in the number of graduate jobs on the previous year. Perhaps surprisingly, there was a slightly bigger shock in 2013, with a 7.6 per cent decline on the number of jobs in 2012. One reason it was worse in 2013 is that big health fields which had been little affected by the 2009 downturn declined significantly. This is consistent with fewer health occupations appearing on the skills shortage list (p. 68).
While graduate employment opportunities have trended down, the number of domestic bachelor degree completions has trended up, by 17 per cent between 2008 and 2014. Given there are still some big student cohorts enrolled in our universities, the number of completions will only increase in the next few years. Unfortunately, we cannot have the same confidence about full-time jobs for recent graduates.
5 thoughts on “What’s going on in the new graduate labour market?”
I realise that this will probably be unpopular with the nice, white, middle class folk but perhaps we need to rethink full time graduate employment as the ‘gold standard’ higher education outcome. We have no idea about whether not the underemployment is voluntary or involuntary (yes, some young people may choose to be in a part time or casual job after they have completed their qualification). There is also no evidence that they enrolled in the course with the explicit intention of rushing into the warm embrace of the full time workforce. So is the decline just reflecting a generational change in aspirations post study rather than the more sinister interpretation that our young people are being short changed by the unis or the labour market?
Sonia – There has been an increase in people working part-time but not looking for full-time work, from 8% in 2007 to 12% in 2014. However the main figures on un- or under-employment are only counting those who are looking for full-time work.
It could be a preference for part-time work, but it would be a bit of a coincidence if a generational cultural change just happen to occur at the same time as a decline in FT employment opportunities.
I think it is more likely that some people are adapting to the labour market realities, and doing other things with their lives, even though ideally they would prefer to work FT (or at least have the income from FT work).
And I am intrigued as to the basis of your implication that wanting full-time work is a ‘white’ characteristic.
I wouldn’t read too much into white – only referring to mainstream, cookie cutter, ‘old-school’, last millennium thinking.
To keep it light
Just suggesting that graduates may be seeking a more flexible collage of job options rather than locking themselves into a linear transition from uni graduate to full-time worker. If young people are staying at home longer, delaying marriage, childbirth and (by extension) purchasing a home, where is the imperative to obtain a full-time job immediately after graduation?
Maybe the labour market is also adapting to this need for flexibility. I offered two essentially identical professional positions recently and received an amazingly good selection of applications for the part-time role. I struggled to fill the full-time role and only did so eventually by calling in a favour. It’s given me serious pause for thought about how I structure professional roles in my team.
I did sort-of know what you meant, as I realise that in some sub-cultures ‘white’ does not literally mean that someone has white skin.
Still, I think this terminology is confusing at best and a bit racist at worst, in implying stereotypical aspirations, work ethic, etc of ‘non-white’ groups.
I don’t doubt that some people prefer part-time work. But I suspect the primary reason for the trend is not different preferences, but different circumstances.