Week 32, 2017: Historic Graduate & Apprentice Share by Work Sector

   

Summary:  This chart shows the increasing graduate share and declining apprenticeship share in the workforce within selected work sectors since the late 1980s. This trend, particularly the lowered availability of apprenticeships, began in earnest prior to the 2001 election, with Tony Blair making a manifesto pledge that 50% of young people would be encouraged to attend university, for which he also introduced £1000 per annum tuition fees. The chart shows that this vast increase in graduate numbers has not been met with correspondingly ‘high-level’ jobs. Conversely, work sectors that have historically been approached via vocational training are seeing not just a decline in apprenticeship candidates but also an increase in the number of graduates undertaking roles. Indeed in 2015, the UK graduate rate stood at 58.8%, the second highest in the OECD, and research by CIPD has shown that over 8% of graduates now work in jobs that do not require or fail to utilise skills gained through their degree. When set in context of the exponential rise in university tuition fees since their introduction (indeed they are set to increase further in line with inflation); it would appear that ever more students are paying ever increasing sums for training that increasingly fails to deliver the quality of employment anticipated. However this is reliant on the assumption that the sole motivation for attending university is the increased earning power or intellectual challenge of graduate employment. 

What does the chart show?     The different colour segments of the bars on the graph represent the various proportions of graduates, apprentices, and others working in the selected industries. The proportions change throughout the 3 data points (1989, 2004, and 2014) along the x-axis. The orange section represents the percentage of graduate employees, the blue section represents the percentage of apprentice employees, plotted against the left-hand axis.     

In 1989, university tuition was free, whereas in 2004 the average tuition cost of a degree was £3,000 (introduced by Blair and also raised to this level for students enrolling in 2005/6), and by 2014 this had increased to £27,000 following the Browne review in 2010. Although this correlates to the increase in graduate employees, the chart displays how a significant proportion of employees do not have university degrees or apprenticeship training, especially amongst care workers and hospitality staff. On the other hand, industries such as construction management and have experienced a significant increase in graduate employees and relatively stable proportions of ‘other’ employees. Graduate employees increased from 8% to approximately 32%, and the proportion of remaining employees changed by under 2%. Apprentice proportions declined from 53% to below 30%.

Why is the chart interesting? The chart shows that construction and manufacturing management, alongside gardening and landscaping have experienced the largest increase in graduate employees, despite a historic tendency to train employees vocationally. For example, the graduate share in construction management increased almost 4 fold from 7.7% in 1989 to 30.4% in 2014. Although some of the drivers mentioned above may be at play, particularly for construction and manufacturing, this change could be driven by additional factors. The evolution of industry practices for example more mechanisation/automation or increased regulatory and compliance demands could have contributed to a growing requirement for employees with graduate education.

Similarly, the retail and sales industry experienced a significant influx of graduates, with an overall increase of 615% between 1989 and 2014. This increase is particularly stark between 2004 to 2014, likely reflective of the effect of the global financial crash on employment opportunities for graduates. Industries like office management and hospitality have had a smaller climb in the proportion of graduates. For office management this rose by only 52% between 1989 to 2014.

In an attempt to combat the dearth of vocational training, the government pledged in 2015 to increase the number of available apprenticeships by 3million by 2020. The then Minister of State for Apprenticeships and Skills, stated that the levy “will give our young people the chance they deserve in life and to build a highly skilled future workforce that the UK needs”, suggesting a desire to elevate apprenticeships as a worthy alternative to university education. However, the completion rates for apprenticeships have been problematic in the UK, dropping further from 76.4% in 2010/11 to 68.9% in 2013/14. There has been controversy about some of the providers of apprenticeships, who have faced criticism for poor service management resulting in low participant engagement. Most recently, Learndirect, privatised under the coalition government, were assigned the lowest possible ranking by Ofsted of ‘inadequate’. This resulted in the recent withdrawal of the government funding on which providers such as this rely, and made Learndirect the second provider in 5 months, following First4Skills, to have their public funding revoked.

The demand for apprenticeships has also declined as the demand for university enrollment, despite its associated cost, has risen. In 2015 a poll of UK 16-18 year olds showed that 65% of them perceived that their parents would prefer their attendance at university over an apprenticeship. The young people themselves overwhelmingly felt that apprenticeships would hamper their earning capacity over the career.