Personnel Today - Overeducation blights careers across UK

An interesting article written by by Adam McCulloch for Personnel Today and worth sharing. 

New data released by the Office for National Statistics has shown that almost a third of graduates have more education than is required for their job.

Just under 22% of people who graduated before 1992 were overeducated for their roles, compared with 34% of those who graduated after 2007. Many continue to be in roles that don’t match their qualifications for some time, with 29% of graduates still overeducated for their role five years after graduation.

“Overeducation represents a cost to taxpayers and individuals and has been cited as a reason for Britain’s poor productivity performance,” Bloomberg said. According to Bloomberg the figures raised questions about the extent of under-used talent in a labour market where employment was at record levels.

The figures, for 2017, revealed that third (31%) of graduates had more education than was required for the job they were doing. People aged 25-34 and 35-49 were proportionally the most subject to overeducation.

London had the highest proportion of overeducated workers by far, with 25% of employed people between the ages of 16 and 64 being overeducated.

This could well be because of the concentration in the region of migrant labour, characterised as being well educated but accepting jobs requiring fewer skills so as to establish English language ability and homes. Non-UK born overeducated workers accounted for 15% of all workers living in London in 2017. Half of all people in London had an education exceeding A-Level standard, compared with 30% in the North East, which had the lowest proportion of overeducated people (13%).

Although the ONS analysis also acknowledged the possibility that many graduates were overeducated for their roles because of personal preferences and personality traits. It concluded: “Some graduates may willingly refrain from maximizing their individual income due to hidden preferences. It follows that to fully depict the effect of overeducation on workers’ productivity it is not sufficient to concentrate exclusively on earnings.”

Senior ONS economist Dr Maja Savic said of the findings: “While overeducation is more prevalent in recent graduates, it is also common for those who left university some time ago.”

The ONS report details how the relationship between overeducation and productivity can be viewed through the prism of its impact on wages. It says there is evidence that overeducated workers are likely to earn lower wages relative to similarly educated individuals whose jobs match their education. It also points to evidence that overeducation is associated with lower productivity.

Personnel Today - Overeducation blights careers across UK