Can we use outcomes data as a proxy for institutional quality?

There is a lot of talk at the moment about using outcome-related metrics (often as part of the proposed Teaching Excellence Framework) as a measure of institutional quality.

Gordon McKenzie outlines some of the challenges here on WonkHE, whilst Steven Jones, writing for the Guardian, delivered a good summary of the seven rules the Framework ought to follow.

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DLHE and graduate demand

I’m speaking at the AGR on Monday about skills shortages. Come and see me if you can. Whilst polishing the presentation, including some of the new DLHE data, I had the idea of comparing labour force data with DLHE outcomes to see how quickly the economy is creating jobs and how that relates to graduate numbers. Using Annual Population Survey data to the end of 2014, here are two very interesting graphs. Occupational Change 2007-2014 This first examines occupational change in the UK between 2007 – just before the recession – to the end of last year, when recovery was ongoing. Occupational classes 1 to 3 are ‘professional level’, jobs now largely done by graduates. In that time, the economy added well over a million new graduate jobs (so this doesn’t take into account replacement demand at all) whilst losing jobs from most non-graduate employment categories. During a terrible recession. Anyway, hold that thought. Here’s what happened last year, during 2014. occ change 2013-2014

A much healthier picture across the economy (which puts the previous graph into context – even though we added nearly 100,000 skilled trade jobs last year, we’re still over 89,000 jobs down on pre-recession), but the key thing is that bottom three rows. Last year, the UK economy added a touch under 310,000 new graduate-level jobs (although not all of them will have been filled by new graduates, of course). DLHE tells us that around 205,000 first degree graduates, both full-time and part-time, entered the UK jobs market last year. In fact, if you add together everyone who got any kind of HE qualification at all, it came to just over 279,000 graduates known to be new workplace entrants in the UK.

Although this does not include all graduates, as not all reply to DLHE, and the true number of entrants to the workplace from HE will have been higher, many of those entrants didn’t go into graduate level employment. If the economy continues to add skilled jobs at this rate, then issues of graduate skills shortage – already serious in a number of areas – could become more and more pressing. It certainly doesn’t suggest an obvious oversupply of graduates. Interesting times may be ahead.

Which industries are most likely to demand a 2:1 or better?

70% of graduates from 2012/13 who took a degree with a classification got a 2:1 or above, and 76% who were employed in a professional-level job after six months, had got a 2:1 or above. That 2:1 is pretty important.

I have taken a look at the industries that employ the largest and smallest proportions of 2:1s and above, only looking at degrees with the usual classification system, as otherwise health looks weird.

Publishing was the hardest industry to get into without a 2:1 – 86.6% of new entrants had at least a 2:1, and that rises to 93.8% for book publishing. Those who got in without a 2:1 tended to be in journalism or marketing roles, to have got their jobs through personal contacts or agencies, and to be from areas of the country with a high level of HE participation. This is probably worth bearing in mind the next time we hear media commentators telling us about standards; their industry is a very atypical one (and far more London-focused than almost the whole rest of the economy).

Law and accountancy are the next toughest, with 86.2% with 2:1 or above. Accountancy is harder than law – 90% with 2:1 vs 79% with 2:1. Small businesses were more likely to recruit 2:2 or below, mostly as paralegals in law, or as accountants or accounts managers in accountancy, and personal contacts were paramount to get into both industries without 2:1 (although agencies were also important in law).

The third in the list is the ‘other vehicle’ – ie aerospace and defence vehicle – manufacturing industry. 86.1% of new entrants had 2:1 or above. This is quite a small industry for annual recruitment of graduates, and the main roles are in engineering, where skills shortages mean that engineers with 2:2 or below sometimes get jobs in the sector, often through personal contacts.

Best get a 2:1 if you want to get in these. Better still, a First
Industries most likely to demand a 2:1 from new graduate entrants from 2012/13

At the other end of the scale is the residential care industry, where 61% of new professional entrants had a 2:1. 50.4% of new entrants to residential care nursing had 2:1 or above, rising to 63.4% to roles specifically in the care of the elderly and disabled. Many of these jobs are in nursing or general welfare roles, and are filled through agencies and the data suggests there are recruitment shortages, especially in London, but it also looks as if some jobs that are being coded as graduate and being taken by graduates may not really require a degree.

64% of new entrants at graduate level to the food and beverage service industry had a 2:1 or above – much the most common roles here are as pub or restaurant managers, where a 2:1 is useful but not vital, and a similar story is in the sports and leisure industry where 65% of new entrants had 2:1 or above, and the crucial subsector is in sports and leisure centre management, where a 2:1 is not absolutely vital.

Industries least likely to ask for a 2:1 for new graduate entrants from 2012/13
Industries least likely to ask for a 2:1 for new graduate entrants from 2012/13

It is possible to get into a professional job without a 2:1, but you might need to be realistic about your target industries and to work whatever contacts you have available to stand a decent chance of getting in. This may ease as skills shortages really begin to bite, but it’s always best to assume you have a fight on your hands and to prepare for it.

On Goodhart’s Law

Goodhart’s Law is most simply stated as: “When a measure becomes a target, it ceases to be a good measure.” It was developed by the economist Charles Goodhart (now Emeritus Professor at the LSE), initially as a critique of economic policy.

A similar principle is Campbell’s Law: “The more any quantitative social indicator is used for social decision-making, the more subject it will be to corruption pressures and the more apt it will be to distort and corrupt the social processes it is intended to monitor.”

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Coast to Coast – graduate migration in the UK

The work I have recently published on graduate migration has got quite a reception.

It’s actually meant to be the first part of a much more in-depth study of regional labour markets, but I decided to follow up two earlier pieces I wrote, from 2008 and from 2005.

The graph here is, if you like, an out-take – it’s the actual number of graduates falling into each of the four groups, Loyals, Stayers, Returners and Incomers, for each region. For reference, here are the categories

  1. Regional Loyals: These are graduates who are domiciled in a region, went to study in the region, and remained to work in that region.
  1. Regional Returners: These are graduates domiciled in a region, who go elsewhere to study, and then return to their home region to work.
  1. Regional Stayers: These are graduates who travel away from their home region to study, and then stay in that study region to work.
  1. Regional Incomers: These are graduates who go to work in a region in which they neither studied nor were domiciled.
migration numbers
Migration categories for first degree graduates from 2012/13 who were of known domicile and known location of employment after six months.

The North West and Scotland both had more Loyals than London, but the London Incomers are the largest single category in the whole study – more graduates entered London, having had no prior domicile or study there, than were working in most parts of the country – the North West, West Midlands and South East excepted. London’s pull is intense.

There’s a lot more work to potentially be done here – I am considering redoing it just for ‘graduate’ jobs, although I’m not sure if that would be as valuable as it might initially appear. Is it worth attracting graduates out of London to temporarily take lower-skilled jobs in the hope/expectation that they will convert to professional employment? If that pool of skilled labour isn’t present in a region, will that hamper efforts to grow the number of skilled jobs locally? Interesting questions. I’ll keep digging for answers.

 

A Tale Of Two Jobs Markets

I’ve been looking at Annual Population Survey data today, looking at how occupational data has changed since the start of the recession.

If you delve into NOMIS, you can look at APS data to September 2013 (this link should take you straight there). I compared employment data by SOC for September 2013, with September 2008, right at the very start of the recession, to take a look at home the jobs market has changed.

employment balance
Change in the number of workers in each occupational subgroup between September 2008 and September 2013. Data source is Annual Population Survey/Labour Force Survey data analysed using NOMIS.

Everything down to, and including, ‘business and public service associate professionals’ is ‘professional level’ – or, paraphrased, are jobs for which a degree is now more-or-less a requirement. Everything below isn’t.

There’s two jobs markets here. The professional jobs market, quite focused on London and its surroundings, but with other areas of strength around the country, and that’s thriving (unless you’re in the Armed Forces). And then there’s everything else except working as a classroom assistant, a carer or something similar. More geographically spread, less well-paid, and those jobs have gone by the tens of thousands. Much of the damage actually happened in the early parts of the recession, and some of it represents long-term occupational decline. In September 2005, the largest of these groups by number in the economy was the ‘administrative occupations’. Now, it’s the ‘elementary administrative & service occupations’. Almost all of these occupational groups are also up on 2012, when employment was especially bad – particularly the skilled metal, electrical and electronic trades.

But it is food for thought. A lot of people in occupations towards the bottom end of the graph will struggle to get work in jobs at the top end. It’s all very well saying we’re creating a load of STEM jobs, but they’re not much use to tens of thousands of former plant, process and machine operatives now out of work and lacking the qualifications to take those opportunities.

Most graduates from most courses at most institutions will get decent jobs, and the areas that they’re looking to work in, by and large, are expanding. It’s not easy to get work for most, but in most cases it’s a lot easier than it would be if they hadn’t gone.

Known Unknowns – What We Don’t Know About What International Graduates Do

This is the piece I wrote for UUK’s International Focus newsletter this January, designed to look at what we know about international student outcomes and what we are hoping to find out in future.

The UK has one of the world’s most detailed higher education data offerings, with especially effective national-level data on early graduate outcomes through the Destinations of Leavers of Higher Education (DLHE) survey. Amongst major global higher education providers, only Australia has anything comparable as an integrated national view of the outcomes of graduates.

Outcomes data through DLHE for home graduates are well publicised and are easily obtained from a range of sources, such as ‘What Do Graduates Do?’. But what do we know about the outcomes for international students? Some work has been done by organisations like i-graduate, and who produced a report on the subject for BIS in 2012, but there is little formal information out there.

Continue reading Known Unknowns – What We Don’t Know About What International Graduates Do

The 2015 graduate jobs market – how will it look?

Enough back-patting, let’s look at the 2015 graduate jobs market. This is a lot trickier than 2014, to be honest – in fact, it’s probably the hardest to predict since the recession because of – well, you can take the second reason to work out why.

As this is my blog, I’m permitting myself some opinion in italics.
So, let’s start with the first prediction:

Economic recovery – slow and patchy

This is a slow recovery and a lot of people are concerned about issues that could blow it off course. My feeling is that the economy is likely to continue a basic upward trend, but it may not be as strong and sustained as it was in the last 18 months. I’d expect the outcomes for graduates from 2014 to be slightly better than 2013, especially in building and architecture, engineering and financial services (and computing!). By the end of the year, we still won’t be back to where we were before the recession.

Added for High Peak Data – I have never been someone who thought that the recession was such an epochal event that the graduate jobs market would never recover. I expected the recession/recovery cycle to take about a decade, but I am starting to come to the view that we may need, at the very least, to see an end to public sector job losses, to get back to a pre-recession graduate labour market.
Uncertainty and the election

Uncertainty is back, and that breeds labour market caution. There are a lot of big things going on – we saw how much this can affect things in the second half of the year when the Scottish referendum brought an awful lot of uncertainty to graduate recruiters and the jobs market was disrupted. We have a General Election in May and that’s going to affect the graduate jobs market. This isn’t the blog for dissecting the right and wrongs of political policies, but some do have an effect on graduate recruitment.
Continuing public sector cuts will disproportionately affect the employment of graduates, particularly women and those outside the south east and if enacted that will probably mean more concentration of jobs in London and the overheated housing market there. Curbs on foreign students won’t have an effect on unemployed home graduates – they’ll just mean more hard-to-fill vacancies for recruiters and more skills shortages, with an effect on growth and on wages. And if business doesn’t think a new Government’s economic policy provides a stable platform for the national finances, they’ll be reluctant to invest – and that means fewer jobs.
But the most likely outcome of the election is a Government with a small majority and little room for manoeuvre, possibly a coalition of parties with often differing economic and social priorities, or even a minority Government. This doesn’t breed economic certainty and a lot of decisions are likely to be deferred until after May.

There is the argument that, economically, the two main parties are not that different (which, personally, I don’t buy), and that the paries , but we’re in the sphere of business confidence here and perception and belief are important. Once business has a chance to digest the election results and to work out medium-term effects, we’ll see more stability.

Oil

Very much a double-edged sword here. A lower oil price is good for the running costs of business and that might make them keener to recruit. Logistics, for example, is seeing skills shortages and may be a promising hunting ground for graduates looking for a less conventional challenge. But the big graduate success story of the last few years, Aberdeen, is already seeing belts being tightened and facilities being mothballed. A few more months of low oil prices is not going to be great for that part of the world and not for the jobs market for engineers and geologists, although both are in demand.

A lot of this will depend, of course, on how low the oil price gets and how long it stays there. A short period of low oil prices won’t have much of an effect, but a long period will.

The regions – again

I could pretty much cut out last year’s prediction and put it in here. London will continue to thrive and may continue to capture a larger share of the graduate jobs market. The REF 2014 results will not help, as they could drive a greater concentration of HE funding to the capital and south east. The larger cities – Birmingham, Manchester, Leeds, Edinburgh, Glasgow, Cardiff, Belfast – will continue to do well, with other cities with reasonable graduate jobs markets, including Bristol,  Newcastle, Sheffield, Nottingham, Leicester, Liverpool,  Oxford, Cambridge, Norwich (I’ve doubtless missed somewhere important), as well as the commuter towns and regions of the east and south east, will probably also see opportunities. But outside those areas  graduates looking for work may not find a great deal, particularly if public sector employment continues to fall. Some towns or regions with a strong engineering sector, like Derby, Lancashire and Warwickshire may find that a demand for engineers boosts the local economy.

One of the hidden effects of the recession appears to have been to affect the proportion of graduates staying on in the city they studied. It seems to have fallen and this looks to me to be at least in part as a consequence of public sector cuts, especially in health and local Government. We also need to be mindful to monitor whether successful local cities may be drawing skilled roles away from other parts of the same region that need them – the graduate labour market in the north west, for example, may be getting more concentrated in Manchester. 

Skills shortages and wages

There are clear signs of skills shortage in the graduate jobs market, in engineering and parts of financial services. Added to this, the ONS have noted that professional level roles are seeing wage rises above inflation. This suggests we might start to see increased starting salaries and pay rises for graduates – at least those in jobs that are in demand. I’m not so sure about engineers, though – a lot depends on how the oil and gas industry, which has been driving up wages, responds to low oil prices. Of course, higher salaries mean higher costs for business, so we will have to monitor business confidence.

How prepared is UK plc for recovery? Yes, increased business, but also increased skills shortage, employee turnover and wage pressure. Graduate retention is already a hot topic for recruiters, but it may become harder as employees become more confident and more inclined to look for moves.

In summary

 We’re still in a shallow but sustained recovery, and so the likelihood is that we’ll see a modest improvement in the prospects for graduates in 2015, but probably not as much of an improvement as we saw in the last 18 months. There is a lot of uncertainty about, particularly with an election in 5 months, and with oil prices dipping. London is likely to continue to be strong, and there’ll be opportunities in the larger cities, but other areas may not fare as well. Skills shortages in some sectors, particularly in technical areas like engineering and computing, may start to bite and salaries might start to rise.

Am I right? I guess we’ll see in a year. Good luck to everyone in 2015.

Charlie’s Crystal Ball – how did I do predicting the 2014 graduate jobs market?

This is taken from my work blog, but it worth sticking here along with the companion piece.
The start of the year is a time for traditions, and one of the blog traditions is that I pretend to hate making predictions and then do exactly that, but first, let’s check if it’s worth actually reading them, by examining last year’s speculation and seeing if I were right.

I predicted:

STEM – on the up?

The jobs market will probably improve for graduates from most science and engineering disciplines – particularly for engineers, who have really suffered over the last few years. Although there may well be growth in employment in small specialist engineers, especially those with a good export presence, engineering recruitment will continue to be dominated by the larger firms, and if you want to gauge the engineering jobs market as the year goes by, you could do worse than keep an eye on the big players. I’m not sure that the prospects for biology graduates will necessarily improve though – their jobs market seemed to worsen last year.

Yep, pretty spot on, although biology graduates did see a slight improvement in their fortunes. It wasn’t much, though.

Financial and business services to grow

Economic recovery in the UK will necessarily involve growth in finance and business services. Marketing and PR has been a graduate success story in the last few years and has been drawing graduates in from all sorts of disciplines – the rise of digital media and content means that graduates with good IT skills have a niche in marketing – and I don’t see any reason why that won’t continue. I’m not sure we’ll see a huge increase in financial services recruitment but we will probably see a little growth.

Right here as well. Financial services is interesting, though and will bear close inspection in 2015.
 

Cities on the rise

Although things are broadly positive, this recovery doesn’t look very evenly shared out at the moment. It’s pretty focussed on London and the south-east, although I’d expect those cities that have weathered the recession reasonably well – Edinburgh, Glasgow, Leeds, Birmingham, Manchester, in particular – to probably share some of the joy. Aberdeen’s unique jobs market will probably mean another good year for engineers and technical graduates wanting to move up there. But if you’re outside those areas, particularly if you’re in a smaller town, or in the north of England or Wales, you probably won’t see much of a sign that the graduate jobs market is picking up at least at the start of the year. I expect regional and local differences to become more pronounced in the early part of the year – more graduates in the north-west and north-east moving to Manchester and Newcastle respectively, more graduates everywhere heading for London. It remains to be seen whether it’ll be a temporary phenomenon or whether a small but subtle permanent realignment of skills concentrations is underway.

The regional agenda became more important during 2014 as it became more clear that the benefits of recovery were not being equally shared. I’d say I was reasonably right – I may have missed Newcastle, Cardiff, Sheffield and Belfast from the list – but I was hoping for a bit more even growth around the country. Aberdeen is another interesting case – I’ll talk about that in my 2015 predictions.

In summary

I think the Class of 2014 will find the jobs market a little more welcoming than their counterparts from the last two or three years. Not where it was pre-recession, but a little kinder. Unemployment in DLHE will be about 8% and starting salaries around £20k as they were this year. They’ll still have to work hard – very hard in many cases – to find work, but they might find it a little easier and they’ll have careers staff who are now well-versed in recession job-hunting to help them out. Happy New Year, and good luck to everyone.

If anything, I erred on the side of caution – actually, the overall market improved more than I expected.

I also suggested that other reports of a surge in the IT market were a bit overblown and that computing graduates would still have high unemployment rates. Well, I was half right. Computing graduate unemployment rates are still high, but the IT market did improve markedly and there are now skills shortages. I’m trying to get to the bottom of how both these things can be true at the same time with the help of data kindly provided by the UKCES, so watch this, and other, spaces.

So, in the end, I really didn’t do too badly at all. I clearly have terrifying psychic powers, like a graduate labour market Professor X.

Next up, using those powers for good by making predictions for 2015.

Stats, research and probably some graphs about UK higher education from HECSU's Charlie Ball