Employment Performance of UK Graduates in the Labor Market

This report evaluates the employment performance of UK graduates in the labor market over the last 3-5 years, discusses ways to improve employment levels and increase service opportunities, and evaluates whether the benefits of obtaining a degree exceed the costs.

Running head: BUSINESS
BUSINESS
Name of the Student
Name of the University
Author’s Note

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Executive Summary
The report focuses on the employment performance of the UK graduates in the labor market. The
performance trends of UK graduates over the last three to five years have been reflected in this
study. This study also illustrates about the way to improve the employment level and increase
service opportunities for the graduates. The benefits of obtaining degree exceeding cost is also
evaluated in this study.

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Table of Contents
Introduction......................................................................................................................................3
Rate of employed graduates in UK..................................................................................................3
Employment performance of UK graduates in the labor market.....................................................4
Evaluating whether benefits of obtaining degree exceeds the costs................................................7
Conclusion.......................................................................................................................................8
References........................................................................................................................................9

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Introduction
The report focuses on the employment prospects for the UK graduates in the labor
market. In today’s world, employment is not secure owing to changing requirements of employer
and changing economy. It is vital for the graduates to build employment skills and professionally
qualified in order to attain employment, retain their position in workplace and improve their
career. The study provides an overview on the employment performance of UK graduates over
the last few years. Recent evidences reflect that there has been steady rise in total number of
graduates in UK over the past few years. It has been seen from few studies that most graduates in
UK are employed in such jobs in which the degree is not needed due to rising number of
graduates in the UK population. The total number of these graduates have increased over the
years as less percentage of UK population are pursuing graduation from top universities. For
instance, one of the top ranked UK universities such as the Russell Group have near about 31%
of graduates holding bachelor’s degree (Abreu, Faggian and McCann 2014) The surveys also
reflect that the graduates from top UK universities are earning more than the graduates from
other UK universities. This study also discusses about the way to improve the employment level
and increase service opportunities for the graduates.
Rate of employed graduates in UK
The graduates refers to the individuals who have completed their education along with
qualifications to A level standards. This involves the individuals with degrees and higher
education. Recent facts highlights that there are near about 12 million graduates in this nation.
Moreover, it has been seen that the non- graduates who are aged between 21 to 30 years have
higher unemployment rates and inactivity rates as compared to the graduates. Almost 40% of the
UK graduates have been working in education, health industry and public administration. Over

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the last few years, the graduates worked in the high skilled posts as compared to non – graduates.
In fact, the annual earnings of graduates have also reached higher peak with respect to the annual
earnings of non- graduates. Furthermore, the studies also highlights that the male graduates in
UK have higher skilled job as compared to female graduates. The rate of employment for the
female graduates have been slightly lower than the male graduates as they tries to move out of
labor force for looking after their family. Thus, the yearly earnings of the male graduates have
been at higher peak than the yearly earnings of female graduates during the past few years.
The surveys also reflect that the graduates are more employed and less likely searches for
work as compared to those who have left education at lower qualification. In the year 2013, the
employment rate of graduate was near about 87%, which was quite higher than employment rate
of those individuals with lower qualifications. Even the rate of inactivity for graduates were
about 9%, in the year 2013, which was lower than those who have education to A level standard
or those with less qualification. According to the data gathered by Higher Education statistics
agency, employment ratio of individuals leaving university is around 92%, which reflects that it
increased at a higher rate from previous year (Sánchez-Sánchez and McGuinness 2015).
Employment performance of UK graduates in the labor market
Over the past 3 to 5 years, the employment performance of the UK graduates have
increased at a steady rate in the labor market. As the rate of employment is related to individual’s
age, the older graduate as well as non- graduate have higher employment rate than the recent
graduates as well as non- graduates. However, the recent graduates who are aged between 21- 30
years have lower rate of unemployment than the recent non- graduates. Even though near about
350,000 graduates churned out from the UK university during the year 2015, most of the
graduates managed to find those jobs where degree is not mandatory. This in turn caused several

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challenges for the employers as they faced shortage of skills. Furthermore, all the recent
evidences reflects that the employers have continued to provide premium pay to the degree-
holders but their earnings as well as career development varied based on the industry, gender,
age and employment region. Several researches have highlighted that gender pay gap between
the women’s and men’s earnings have been apparent mainly among the graduates with high
qualifications (de Vries 2014). The facts also highlights that almost three- quarters of graduates
have been satisfied with their job and stayed for longer term career plans.
During the past five years, higher percentage of graduates worked in education, health
industry and public administration as compared to non- graduates. These sectors have been
common for the graduates from different backgrounds that might be because of huge range of
availability of jobs. Apart from these sectors, higher rate of the employed graduates also have
been working in banking and finance sector as compared to employed non- graduates (Sage,
Evandrou and Falkingham 2012). Besides this, near about half of recent employed graduates
have been working in non- graduates role over the years. The percentage of such graduates also
increased more than double from the year 2001 to 2017. The competition among the graduates in
getting job have increased over the past few years as most of the UK enterprises focuses on
recruiting skilled and talented graduates. Owing to huge competition in the UK labor market,
recent graduates and non- graduates faces difficulty in finding job in different industry (Durrani
and Tariq 2012).
One of the vital characteristics of UK graduates in the labor market is the extent in which
the employers uses possession of degree specifically, for those who enters the administrative,
creative and managerial careers. Since the UK graduate supply of labor has become highly
diverse, it has led to several problems about the degree as well as opportunities it provides

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mainly for non- traditional graduates. The recent annual survey from Institute of the Student
Employers has revealed that job market for the graduate is predicted to grow in the following
year, with near around 11% increase in vacancies.
These evidences reflects that this classification of the graduate occupations describes the
number of vital characteristics of varying nature of job. It shows that degree is an important
prerequisite for traditional occupation. It differentiates two different occupations groups where
the total proportion of graduates increased rapidly during the last five years. This classification
depicts different employment areas, which graduates have entered over the last few years. The
performance trend of UK graduates in the labor market has been positive (Branine and
Avramenko 2015). Concentrating on employed graduates, it can been observed that men
generally earned an average of $3 more per hour than women. However, the employment
performance trend for men graduates has been higher than women graduates. On the other hand,
the female graduates have been engaged in doing part- time work, which in turn impacts their
progression in career. This also explains the divergence in salary for the female and male
graduates (Nachmias and Walmsley, 2015). This highlights that the performance trend of female
graduates have been lower than that of male graduates. The basic trends for the UK graduates
are given below-
 The rising demand for the high-level skill in the knowledge based region.
 There has been decline in the UK manufacturing industry and rise in service as well as
professional skills
 There has been huge significance of the business innovation as well as growth of small
business with graduates
 Less proportion of UK graduates are in traditional jobs

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 Graduates have potential for higher earning as compared to non- graduates and hence
they are less likely to become unemployment in long run
 There is always a need for the graduates career management skill
The rate of employment for the graduates residing in various areas of UK are more or less
similar but the region with lowest graduate rate of employment is Outer part of UK in which near
about 84% of the graduates are employed. Moreover, six in every ten individuals in inner UK are
employed graduates. Overall, it reflects that the performance trends of UK graduates have
improved irrespective of gender, age and qualification (Helyer and Lee 2014).
Evaluating whether benefits of obtaining degree exceeds the costs
The above evidences reflects that obtaining college degree exceeds the costs in UK labor
market. The reason behind this is that getting genuine degree helps the individual to attain better
job and improve their career in future. This facilitates the UK graduates in the long-term career
plan and earn higher pay with respect to those who having lower qualification (Brooks, Waters
and Pimlott‐Wilson 2012). The recent facts in UK labor market highlights that the graduates earn
more by having higher package offerings as compared to non- graduates. In fact, the UK
graduates are treated in better way and provided with better positions in every organizations.
Thus, they are undoubtedly better settled in life with respect to those who lacks the degree. As a
result, a graduate bearing the total cost of education becomes less than their total earning from
job. This highlights that the UK graduates have benefits of obtaining higher degree as it exceeds
the total cost of attaining education (Sarkar et al. 2016).

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Conclusion
From the above discussion, it can be concluded that the graduates in UK labor market
have better performance as compared to that of non- graduates or graduates with lower
qualifications. Over the last few years, the UK government has been adopting several measures
to expand their higher education as well as enhance the access to huge UK population for
providing degrees to entrants in the labor market. However, such growth has increased over the
last three to five years. Although the non- graduates have been facing difficulty in finding jobs in
UK labor market, they gets employment in such jobs in which degree does not matter. This in
turn creates several issues for the employers of the organization as the non- graduates lacks skill
as well as knowledge. In addition to this, oversupply of graduates also causes many issues in the
UK labor market. In fact, the UK labor market has been changing with response to rise in supply
of graduates. Nevertheless, the career path of employed UK graduates has become better in last
few years in comparison with previous years before recession. Hence, it can be evident from the
facts that the UK government needs to focus on their education structure in order to improve the
employment performance of all people.

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References
Abreu, M., Faggian, A. and McCann, P., 2014. Migration and inter-industry mobility of UK
graduates. Journal of Economic Geography, 15(2), pp.353-385.
Branine, M. and Avramenko, A., 2015. A comparative analysis of graduate Employment
prospects in european labour markets: A study of graduate recruitment in four countries. Higher
Education Quarterly, 69(4), pp.342-365.
Brooks, R., Waters, J. and Pimlott‐Wilson, H., 2012. International education and the
employability of UK students. British Educational Research Journal, 38(2), pp.281-298.
de Vries, R., 2014. Earning by Degrees: Differences in the career outcomes of UK graduates.
Durrani, N. and Tariq, V.N., 2012. The role of numeracy skills in graduate employability.
Education+ Training, 54(5), pp.419-434.
Helyer, R. and Lee, D., 2014. The role of work experience in the future employability of higher
education graduates. Higher Education Quarterly, 68(3), pp.348-372.
Nachmias, S. and Walmsley, A., 2015. Making career decisions in a changing graduate labour
market: A hospitality perspective. Journal of Hospitality, Leisure, Sport & Tourism Education,
17, pp.50-58.

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Sage, J., Evandrou, M. and Falkingham, J., 2012. The complex migration pathways of UK
graduates.
Sánchez-Sánchez, N. and McGuinness, S., 2015. Decomposing the impacts of overeducation and
overskilling on earnings and job satisfaction: an analysis using REFLEX data. Education
Economics, 23(4), pp.419-432.
Sarkar, M., Overton, T., Thompson, C. and Rayner, G., 2016. Graduate employability: Views of
recent science graduates and employers. International Journal of Innovation in Science and
Mathematics Education (formerly CAL-laborate International), 24(3).