University graduates are finding it increasingly harder to find full-time work, prompting calls for a massive overhaul of the education sector.
Research by the Australia Institute’s Centre for Future Work (CFFW) has found that only 73 per cent of recent university graduates have found work – down from 85 per cent just before the global financial crisis in 2008.
Rapid technological change disrupting the labour market and an erosion of “full-time, permanent, year-round jobs with normal entitlements”, coupled with a growth in part-time, casual, self-employed and contractor employment have changed the game for Australian graduates, the report found.
Paradoxically, though, the research also found university degrees will assume more importance than ever with almost half of all jobs created over the next five years (more than 400,000) are expected to require a university degree or better – up from 32 per cent today.
But lead author Alison Pennington told The New Daily that projected jobs growth still fell short of the number of people needing jobs.
“Degrees still matter, but there is a fundamental problem of insufficient demand in the Australian economy,” Ms Pennington said.
Painting a rather bleak picture for young Australians seeking work, The Future for Work for Australian Graduates report also found:
- Underemployment among graduates (those in part-time or casual work who would like to work full-time hours) has increased from about 10 per cent in 2008 to about 20 per cent today
- The percentage of young people working full-time in casual jobs has more than doubled since 1992, from about 10 per cent of workers (aged 15 to 24) in 1992, to 21 per cent by 2017
- About 18 per cent of full-time workers aged 15 to 24 are working multiple jobs to generate enough hours and income
Ms Pennington said much of the problem of graduate unemployment stemmed from the intensely free-market, “dog-eat-dog” environment in which Australia’s universities operate, creating a “haphazard experience” for graduates seeking a job.
The senior economist with the CFFW said Australia had no comprehensive labour market policy or strategy, and that graduates were “largely responsible for navigating the education and training system based on their own interests, capacities and means”.
“This ‘light touch’ approach to managing education-to-jobs pathways begins in the secondary schooling system, as high-school-aged students are urged early on to begin choosing their career pathway(s),” she wrote.
Australia needed to improve the co-ordination between universities and employers in “labour-market planning systems” to better match graduates to jobs and plan for future skills demands, she said.
Ms Pennington pointed to the example of Italy, where a public consortium of 64 Italian universities and social partners operates a centralised online database of graduate profiles (covering 70 per cent of all graduates) and job vacancies, connecting job seekers with employers.
Or France, which operates an internship program for university students with bona fide contracts to protect against exploitation.
Sweden also offers a job guarantee for young people that provides individualised job search assistance to all participants, backstopped with a guarantee of either a job offer, study opportunity or access to small business start-up funds.
So what should you study?
Ms Pennington noted that attaining a university degree was still valuable for gaining employment, with a graduate more likely to be employed, employed in a stable job and earning above-average money.
In terms of full-time employment for graduates, medicine students do the best at almost 95 per cent, while degrees in teacher education, engineering and nursing all realised between 79 and 83 per cent full-time employment.
Degrees in business and management did well at 78 per cent, followed by law and paralegal studies at 77 per cent.
Degrees with the lowest rates of full-time employment were creative arts at 52 per cent, and communications at 61 per cent.
And despite claims of a STEM-graduate deficiency, science and mathematics graduates experienced some of the worst full-time work outcomes, with only 65 per cent finding full-time jobs within four months of graduation.
But Ms Pennington said the data showed that there was no outstanding shortages of skills, even in STEM subjects, but employers had indicated that the skills most in demand were things such as critical thinking, creativity, problem-solving, communication and leadership.
“Employers especially want employees with good verbal, social, problem-solving and communication skills,” Ms Pennington said.
“Despite popular derision of arts degrees, industry leaders now actually want more arts graduates in their workforce – given their training in abstract, critical methods of inquiry,” the research noted.
“Many Australian employers in creative digital fields, for instance, now prefer employing humanities and social sciences graduates (rather than programmers), precisely because they ‘know how to learn’.”