Prolonged changes in the economy during the last 50 years have resulted in a continued decline in ‘youth jobs’ . Employment opportunities for post-war school leavers included apprenticeships – at their peak, up to I in 5 (invariably boys) started one every year – and a variety of openings for ’office juniors’ (more likely girls). These were in addition to thousands of lower and unskilled jobs that were considered suitable for ‘early leavers’ with minimal, if any qualifications. Considered by many to be ‘dead-end’ they at least provided a regular income and in many cases, strong trade union protection.
Changes have been linked to the decline of manufacturing related employment – intensified by the first stage of automation — which still employed well over 7 million people in the early 1970s. Meanwhile service sector employment continued to increase – 70% worked in services by the year 2000. With new white collar and managerial roles considered more complex and requiring educational credentials rather than relying on traditional and local employment practices, facing an increasingly difficult labour market, more young people stayed in full-time education.
By the start of the 21st century there were also highly optimistic projections by Blairite politicians about the opportunities that would be available for highly educated (qualified) labour in the new globalised economy. Blair pushed for 50% attendance in higher education, while universities themselves presided over aggressive student recruitment policies with young people, despite the rapid increase in tuition fees, signing up in their thousands. If routine white collar jobs began to hollow out as a result of roles becoming digitalised (the second stage of automation) the number of professional and managerial jobs continued to increase, though the rate slowed after the financial crash.
The huge growth in the number of graduates meant employers having large numbers of applicants to choose from, so more existing jobs were ‘graduatised’ – you needed a degree to get a job, though not necessarily to perform it. Nevertheless, ONS data still showed two thirds of university leavers progressing to ‘skilled’ employment and graduate unemployment remaining relatively low – even if the period taken to move into employment was getting longer.
Graduates experience a double whammy
But graduate job vacancies in the UK have now sunk to their lowest level since they started being tracked. According to recruiting website Adzuna, just 8,383 jobs for people leaving university were advertised in July, down 45% compared with the same point last year – for the same period ten years ago there were more than 50,000 positions. Based on estimates from a number of sources, there are now just 150,000 annual graduate vacancies in the UK, down 8% from last year.
A change in the number of graduate vacancies is not in itself unusual. It’s affected by wider economic conditions and fluctuations and in the level of business demand. There might also be a longer term relationship between a decline in graduate recruitment and the increase in virtual working. But major uncertainties about the increased availability of AI must also be considered. Reports indicate an AI-powered drop in entry-level hiring has been particularly prevalent among major graduate recruiters.
The World Economic Forum reported earlier this year that entry-level job postings in the United States had fallen by 35% over the previous 18 months as AI adoption accelerated. According to the British Standards Institution (BSI) young people entering the workforce are facing a ‘job-apocalypse’, as business leaders invest in AI rather than new hires with four in ten (41%) of bosses now reporting that AI was allowing them to cut the number of employees.
Like the previous apprenticeships and junior office role, entry-level employment for graduates has been integral to the acquisition of ‘on the job’ skills – ways of working with different sorts of people, as well as covering a variety of tasks. But AI is now able to perform more than half of the daily tasks in many entry level roles – reading earnings reports, classifying regulatory filings, flagging suspicious transactions, drafting reports, and analysing large datasets. Falls in entry level employment mean that senior staff can’t pass on workplace skills and practices in the way they have traditionally done so
If the growth of AI is resulting in a systematic fall in graduate openings and declines in the ‘graduate premium’ then it comes at a time when approaching 270 000 school leavers are transitioning to university this September – underlying the gravity of the problem. The rate of increase in student numbers might be levelling out, but it’s certainly not falling.
Needless to say, government and various other agencies have been plugging the benefits of apprenticeships instead. It’s certainly the case that there has been a rapid growth of higher-level apprenticeships at level 4 or above, with surveys showing that at least as many school leavers would choose degree level apprenticeships rather than full-time university study, if these were available.
But they are not. Only 1 in 5 of new apprenticeship starts are by those 19 or under, while for higher level schemes the numbers are lower still as large employers use their apprenticeship funding on existing staff, including management trainees. So, it’s the absence of any other alternatives that leads to school leavers continuing to sign up for university in the way that they do, despite the huge costs.
Is the university bubble going to burst? If the benefits from attending university are considered to be primarily economic, then the answer might appear to be unequivocally ‘yes’. But while vocationally orientated courses like ‘business and management’ are the most popular (approaching 10 per cent of all enrolments) there have not been significant increases in the take-up of ‘hard’ courses (natural sciences and maths for example) at the expense of social sciences and media. On the contrary, there’s now a growing array of degree opportunities covering almost every interest and whim.
So maybe ‘going to uni’ despite the cost, is increasingly becoming the new normal – an integral and engrained part of young people’s lives, in the cultural sphere as much as a labour market. It’s probably too early to reach and definitive conclusion. about this.
Education, Economy and Society 