Earn a university degree and get a job. This formula has worked with relative success for over 50 years. But increasingly in many fields today the formula is no longer working.
Student picture from Shutterstock
With nearly twice as many full-time students (approximately 1.2 million) enrolled in university study as there were in 1996, competition for jobs is at an all-time high. This competition seems to be manifesting itself in credential inflation -- the value of academic credentials decreases over time, along with the expected advantage given a degree holder in the job market.
What's behind this trend?
Undergraduate programs are booming nationwide for a number of reasons, including higher future earning potential and higher expectations for all levels of jobs. Jobs that high school graduates used to fill are being reserved for university graduates.
According to the Talent Equation study, there has been a 10% increase in customer service, sales and management workers possessing an undergraduate education in just five years.
Employers report that they want degree holders because of the tight labour market and the evolution of their work. Economics researchers found that as universities expand the number of enrolled students, the average ability and wage of university graduates decreases. Yes, salaries suffer as more people graduate.
Essentially, it is the supply and demand of labour within free markets that drive this. Yet universities continue to increase enrolments, with particular emphasis on international students, aiming to equip learners with the skills and experience to succeed and compete on a worldwide scale despite the current economic climate.
Global competition in business has also driven the demand for higher education. Within almost all industries, there is a shift to employ university graduates. This has become the norm for most professional jobs.
Being competitive in the job market
Despite the demand for workers who hold a university degree, 32% of graduates across all fields of study did not find full-time employment within four months of completing their degree in 2014. This chart demonstrates the severity of the downward shift of approximately 16% in employment of university degree holders over the past 14 years.
Employment data from Graduate Careers Australia surveys
With some undergraduate courses having up to two-thirds of their university graduates unable to find a job, students are seeking other ways to secure a job. These include postgraduate education.
Today, longer commitments to formal education programs (Masters/Doctorate degrees) are often required for jobs across all sectors. While most jobs require continual learning experiences to stay up to date with the latest developments, many jobs now demand advanced degrees. This includes those related to research (lecturer, statistician, economist), innovation (petroleum engineer, physicist), specialisation (counsellors, social workers) and administration (consultant, investment banker, school principal).
Overall, 61.2% of all postgraduates indicate that their advanced degree was either required or at least important. Postgraduate education is structured to enhance one's depth of knowledge and ability to apply skills in new and creative ways not always attainable through an undergraduate course alone. Postgraduate degrees are what bachelor degrees represented a generation ago — an upgrade from the status quo.
Attaining a specialisation certification, or expertise, is in some cases also required. Examples include a teacher with a Certificate of Gifted Education, a midwife who has advanced training in neonatal health, or a computer programmer who can code in multiple languages. From earning advanced degrees to job acquisition and career advancement, further education is central to achievement, more so than ever before.
Getting an undergraduate degree today shows you have a foundation of knowledge and skill. However, employers are increasingly seeking those with postgraduate qualifications as proof of their ability to think, analyse, solve problems, communicate effectively and improve outcomes.
This shift has occurred in about one generation; so what might the future hold for education? What will be required for getting a job in ten years' time?
Evan Ortlieb is Course Leader & Senior Lecturer at Monash University.