Higher education graduates in the COVID-19 labour market face two key challenges. The first and obvious challenge is the increased risk of unemployment due to the contraction of many sectors of the economy, leading to lower rates of graduate job creation. Secondly, there is an additional and less visible increased risk of underemployment.

Graduates may be faced with the invidious choice between taking any job, even one that does not require a degree nor advanced skills, or having no job at all. The UK had a significant issue of graduate underemployment even before the pandemic: more than one third of UK graduates are underemployed, compared to less than 20% in Scandinavian countries and Germany.

Both unemployment and underemployment can have long-term scarring effects for the graduates themselves but also negative implications for economic growth and the exchequer via lower tax receipts and lower likelihood of student loans being repaid.

Although we cannot predict how the pandemic is going to reshape the graduate labour market and occupational structures in the economy, we can study the graduate labour market outcomes of previous generations to determine the individual level (gender, ethnicity, educational attainment, socio-economic background) and institutional (higher education institution, subject) factors which increase risks of poor graduate outcomes and widen the gap in specific sectors between underemployed graduates and those with high-skilled jobs and occupational groups (professionals and managers).

In this project we will:

• analyse data from the Destinations of Leavers from Higher Education Longitudinal (DHLE L) that is linked with Higher Education Statistics Agency (HESA) student record data, to map the factors predicting graduate unemployment and underemployment for different groups and sectors of the economy;
• develop policy proposals to ameliorate these risks and address this national challenge;
• engage in knowledge exchange with stakeholders including policymakers from the Department for Education Graduate Outcomes Division.

Project team

• Prof Matt Dickson, Institute for Policy Research (IPR)
• Dr Predrag Lažetić, Department of Education
• Kalyan Kameshwara, Centre for Employment Research, University of Westminster
• Dr Michael Donnelly, Department of Education

Related

• Priority funding from Research England supports University’s COVID-19 research, February 2021
• Labour market scarring on young people, October 2020
• Higher education graduates in the post-COVID labour market waters – navigating the strait between Scylla and Charybdis, August 2020