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18th Mar 2015

Research consistently finds better employment outcomes for tertiary graduates

In the wake of the global economic crisis, and in the midst of widespread calls for stronger linkages between postsecondary programmes and labour market requirements, we see a greater and greater focus in recent years on measuring the outcomes of tertiary education. Employability and career opportunities for graduates are at the core of this issue, particularly as they relate to persistent challenges with youth unemployment in many countries. We see this at a macro level, most recently in Africa where government leaders and academics have called for a dramatic expansion of higher education and have strongly linked access to quality education to the long-term development of the continent. And we see it as well at the level of individual students and families, where there is a greater emphasis on indicators of the return on investment in tertiary education. There is a demand at all levels for stronger evidence of positive employment outcomes for graduates. We have reported on some of the current research in the field previously, and the findings of two new studies released this quarter provide further compelling indicators for educators and marketers alike.

Is education the solution?

A new study from the International Labour Organisation (ILO), Is education the solution to decent work for youth in developing economies?, underscores why the question of education-employment links is so compelling today: “The global jobs crisis has exacerbated the vulnerability of young people in terms of:

  • higher unemployment;
  • lower quality jobs for those who find work;
  • greater labour market inequalities among different groups of young people;
  • longer and more insecure school-to-work transitions;
  • increased detachment from the labour market.”

More to the point, the authors note the dramatic rise in youth unemployment in many markets around the world is a threat to the social, economic, and political stability of those countries. The study therefore aims to provide “up-to-date evidence on labour market outcomes and education for the population of youth aged 15 to 29 in developing economies, which still make up 90% of the global youth population.” The study examines 28 countries in every region of the world, ranging from Bangladesh and Cambodia to Brazil and Colombia to Egypt and Uganda. Within that sample, 27 countries were classed as “low- to upper-middle income.” It excludes the Russian Federation as the only high-income country in the countries covered. The ILO found a fairly compelling linkage between education and employment across those 27 markets, in that completion of tertiary education serves as a “fairly dependable guarantee” towards secure employment. On average, 83% of youth with tertiary education were in “non-vulnerable employment.” The surety of that guarantee drops somewhat in the lowest-income countries in the study but even there, 75% of tertiary graduates were in non-vulnerable employment. In contrast to this, the study found that youth who had completed only secondary school were reliably less well off in terms of employment prospects. Only seven in ten (72%) of secondary school graduates - across the entire sample of countries in the study - were working in non-vulnerable employment. The difference, however, was even sharper in the case of low-income countries where only four in ten secondary school leavers were securely employed.

“Unfortunately,” the study adds, “completion of education at the secondary level alone is not enough to push youth through towards better labour market outcomes in low-income countries.”

The ILO report makes an interesting distinction between employment/unemployment rates and engagement in vulnerable or non-vulnerable employment. This is, in a sense, a more nuanced understanding of employment outcomes - and the relative stability of graduate employment prospects - where “vulnerable employment” can be understood as a more precarious variety of self-employment or “contributing family work.” As the study puts it, “In other words, employment of these young workers often falls short of decent work, and is driven to a significant extent by the need to make a living in the absence of an adequate social safety net.” Azita Berar Awad, director of employment policy at the ILO told University World News, “The results of the study should be a wake-up call for most developing countries to improve their higher education systems in order to reduce unemployment and informal work arrangements among the youth.” The ILO report notes as well the persistent challenge of labour market gaps across the study sample, and again offers a more nuanced view by income category, such as:

  • The issue in low-income countries, such as Liberia for example, is profound undereducation, particularly related to access to education and the ability to finance studies at the secondary and postsecondary levels.
  • Middle-income countries, such as Egypt or Jordan, however, were found to have well-educated youth populations but also high levels of youth unemployment.

The ILO puts this down to a mismatch between graduate skills and employer requirements, and argues that there is a “compelling need to make education systems more demand-driven.” The ILO’s findings are echoed by additional research released in 2014 by the Organisation for Economic Co-operation and Development (OECD) via its landmark Education at a Glance report. The OECD finds that employment rates for those with tertiary education are reliably higher than those without. At the same time, the report points out, there is a direct relationship between more limited educational attainment and the risk of being unemployed - that is, the less education you have the harder it will be to secure and retain suitable employment (“non-vulnerable employment,” in the parlance of the ILO).

This may be a reasonably obvious relationship on its face. However, the broad, evidence-based findings of global organisations such as the ILO and OECD are compelling in the education-employment linkages they illustrate and will no doubt reinforce the efforts of educators and policymakers to address persistent issues of youth unemployment.

The mobility effect

Another recent study from the UK Higher Education International Unit adds a further dimension to the employment-education discussion with its findings that study abroad can have a direct impact on employment prospects and income. Their report, Gone International: Mobile students and their outcomes, finds that tertiary graduates who had studied (or worked or volunteered) abroad were more likely to be employed within six months of graduation. Those with international study experience were found to be earning slightly more than other graduates as well. The study examined the profiles of 233,185 UK-domiciled graduates of undergraduate programmes (for the graduating year 2012/13), and identified 10,520 who had been internationally mobile at some point during their studies. Looking across this generous sample, the study finds that:

  • Internationally mobile graduates were less likely to be unemployed six months after graduation (5.4% as compared to 6.7% for non-mobile students). The authors characterise this as, “A significant difference based on the sample sizes.”
  • Mobile graduates were more likely to be working abroad (11% as opposed to only 2% of non-mobile graduates working abroad).
  • Mobile graduates, on average, earned more across 11 of 17 subject areas considered in the study.

Vivienne Stern, director of the UK Higher Education International Unit, highlighted the significance of the report for students, educators, and policymakers:

“If we want to encourage students to think about spending some time abroad, we need to be able to show them what they will get out of it. While qualitative evidence of the benefits of international experience is widely available, there is little quantitative evidence to support this.”

In this respect, the Gone International report is an important addition to the research in the field, and a complement to earlier work such as 2014’s Erasmus Impact Study.

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