There is no necessary economic benefit to expanding universities

For a very long time, policymakers and commentators alike have stressed the importance of the graduate worker in modern, post-industrial economies.

The speech that the UK’s former minister for universities and science, Jo Johnson, gave to the Universities UK conference last year is a good example. “The economy of the future will continue to require graduates, and lots of them,” he said. “The steady rise in the level of formal qualifications held by those in employment does not simply reflect qualification inflation caused by large increases in the supply of graduates, as pessimists maintain. It is happening as a result of more fundamental changes in the occupational structure of the UK as a knowledge economy. Some 1.8 million new jobs will be created between 2014 and 2024, and 70 per cent of them will be in the occupations most likely to employ graduates.”

As a result of such convictions, higher education policy is used to drive economic improvement (including productivity, innovation and wages). Greater participation in higher education is also widely believed to benefit social mobility, as more people from lower socio-economic backgrounds move into graduate careers.

The work of those in graduate occupations is seen as distinctly different from those in non-graduate occupations. Graduate work tends to be understood as relatively high-status, autonomous, high-skilled, knowledge-intense and complex. This political narrative provides an optimistic story about a tight relationship between higher education and well-paid professional and managerial work. But it is too simplistic, failing to acknowledge the enormous variation between graduate occupations, sectors and employers.

As higher education has expanded, so has the size, diversity and remunerative potential of the graduate labour market. As a result, there is now greater uncertainty around how to understand the graduate segments of the labour market. What do concepts such as graduate occupations, graduate skills and graduate careers actually mean, and how can we understand the role of higher education within work?

I recently carried out a three-year study on graduate labour, which used case studies of four graduate occupations to create a more in-depth understanding of how work, careers, skills, recruitment and selection are organised within graduate work. These occupations were pharmaceutical and biotechnological research, software engineering, financial analysis and public relations.

The study confirms that graduate work is an untidy aggregate of various types of work, with a wide range of characteristics. It does not provide much support for the assumption that higher education attainment, on its own, will lead to higher status in the labour market, or that a university education is necessarily highly valued by employers within graduate occupations. Recruitment and career advancement are not always driven by university qualifications and the skills associated with higher education; although those skills tend to be seen as useful by graduate workers, in no sense do they cover the entire range of abilities they need to perform their jobs.

My study also shows that what counts as graduate work remains contested and under constant reinterpretation and renegotiation by employers and both graduate and non-graduate workers. For instance, within bioscience, the traditionally non-graduate role of lab technician is often performed by graduates and can be hard to distinguish from entry-level researcher roles in terms of skill level. Yet technicians still have a considerably lower status within the job hierarchy.

So further growth of the graduate labour force may not support improved economic performance. Only under favourable conditions, such as improved job designs that allow for more skills to be used, can an increasing number of graduates lead to improved productivity. To get the balance right, it would help to understand the labour market for graduate workers not as the imaginative gold standard of employment, but as segmented and heterogeneous labour markets, in which university-associated skills are used in very specific and context-dependent conditions.

Policymakers should not equate graduate expansion with economic and social progress, or take the relative high status and earnings of graduate workers as proof of the educational advantage conferred by university degrees in the labour market. Pointing this out does not make us pessimists, as Johnson put it in his speech. It does not devalue the institution of higher education or deny the role that it plays in workplace skill development. Instead, it opens up renewed possibilities to create more sophisticated skills policies that go beyond simple supply-side solutions.

There should be continuous support for higher education participation for a wide range of reasons. But let’s not pretend that the degrees themselves necessarily constitute crucial work preparation or lead to superior labour market outcomes. Status and resources are, of course, still linked to people’s position in the labour market. But the association between class positions and higher education attainment is becoming weaker, and policymakers need to wake up to that.

Gerbrand Tholen is a senior lecturer in sociology at City, University of London. His latest book, which explores the issues in this article, is Graduate work: Skills, Credentials, Careers and Labour Markets, published by Oxford University Press.