House of Commons - Science and Technology

Select Committee on Science and Technology Eighth Report

3 Skills

21. STEM graduates make an invaluable contribution to the economic health and growth of the country, as is outlined in paragraphs 9 to 10 of this Report. As increasing numbers of university STEM departments come under threat, there is some concern that English universities will no longer be able to produce a sufficient number of STEM graduates to meet economic needs, both now and in the future. Indeed, evidence of the impact of the closure of university departments on employers is already available. The Chemical Industries Association (CIA) told us that "the decline in students is impacting directly on university chemistry courses leading to a shortage of graduates. The CIA believes that UK industries that rely on their ability to do chemistry will not be sustainable without them".[37] The impact on the economy as a whole could be even greater. CIA states that, in a global business environment, "companies make strategic decisions every day on where to place their business globally. A key element to this decision-making is the local availability of skills […] The closure of chemistry departments, potentially leading to a reduction in the overall UK skills base, may therefore have a direct effect on UK PLC's bottom line with jobs and revenue moving abroad. We believe that this has already begun to happen".[38] Making sure that the UK can meet the demands of employers for skilled personnel is key to ensuring that it can maintain its competitive edge in a global market.

22. We received extensive evidence of skills shortages in specific areas. Astra Zeneca told us that "in particular we are experiencing a deficit in the number of individuals who are willing to work with animals, an acute lack of graduate and PhD in vivo pharmacologists, a paucity of scientists in areas of integrative science such as drug metabolism and pharmacokinetics and diminishing numbers of suitably qualified chemists, toxicologists, post-graduate pharmacists and pathologists".[39] Shortages of in vivo pharmacologists have also been highlighted by the Association of the British Pharmaceutical Industry (ABPI) as a problem for industry in the UK.[40] Most of the learned and professional societies that submitted evidence to us were able to pinpoint specific skills shortages within their fields. For example, both Professor Tom Blundell of the Biosciences Federation and the Society for General Microbiology expressed concern about the national shortage of skilled microbiologists.[41] Across all the disciplines there was widespread concern about the general shortage of graduates with advanced numerical skills.

23. The specific instances of skills shortages cited in evidence to this inquiry are consistent with a general trend identified in comprehensive studies of the market for STEM graduates. A 1999 study carried out by the then Department for Education and Employment found that 57% of recent recruiters of technical electronics graduates had experienced "some difficulty" in meeting their recruitment targets. This compared to 43% of recent recruiters in R&D, 41% in machinery, 37% in computer services and 33% in pharmaceuticals.[42] In their 2002 market survey, the Sector Skills Council for Science, Engineering and Manufacturing Technologies (SEMTA) found that, across their sector, 25% of establishments had found it difficult to fill some vacancies in the previous 12 months. This was actually an improvement on previous years: in 1999, 36% of establishments had found it difficult to fill some of their vacancies, and in 1998 the proportion stood at 49%. According to the SEMTA survey, particular recruitment difficulties were experienced in leading areas of technological development; areas requiring a hybrid of technological skills with "softer" generic business skills; and in production.[43] Overall, the proportion of STEM employers that are experiencing some difficulty in filling vacancies is high relative to other sectors. In some specific areas recruitment difficulties have become acute, most notably for organisations seeking to employ graduates with a chemical sciences background.

24. The problems experienced by employers are reflected in the relative ease with which STEM graduates currently find employment. The Director General of the Research Councils (DGRC), Professor Sir Keith O'Nions, told us that, "of all the PhDs who graduated in physical science and engineering in 2003, 79 per cent of them were in jobs in 2004, which is very good news, and 42 per cent were in jobs where they were in research roles and of those about half were in the educational system".[44] Professor Boucher of the Royal Academy of Engineering gave us a similar statistic: "the fact is that currently, on graduation, 85 per cent of students graduating in engineering and indeed the sciences are in employment at the muster date, which is 31 December year of graduation".[45] Whilst it is "good news" for STEM graduates that so many of them find employment so quickly, it is not necessarily good news for employers in the sector. The relative ease with which STEM graduates find employment suggests that there may not be enough of them to fully meet employer demand.

25. The higher education system needs to do more than simply meet current employer demand. We commented in our Office of Science and Technology: Scrutiny Report 2004 on the ambitiousness of the Government's target to increase the UK's investment in R&D as a proportion of GDP to 2.5% by 2014.[46] If the Government is to increase the UK's volume of R&D, it needs to increase the number of skilled people employed to carry out this work. The Royal Society has calculated that, if the UK is to meet its target, it would need approximately 50,000 additional research staff.[47] The same statistic was quoted to us by Ed Metcalfe of the South East England Development Agency: "we need about another 50,000 researchers if we are going to match a 2.5 per cent GDP target of expenditure in R&D over the next 10 years, so we need another 5,000 researchers per year on that measure. It is not just a question of standing still, it is a question of increasing the number of researchers".[48] Compared to other developed countries, in 2002 a relatively small proportion of the UK's total workforce was employed in science and engineering jobs: 26%. This compared to 32% in the US, 33% in Germany (in 2001), 29% in France and 38% in Sweden.[49] The extent to which the UK lags behind its competitor countries in this respect is, in itself, an indication of the potential for it to increase the proportion of its population employed in science and engineering jobs. If the Government is to meet its ambitious target of increasing the UK's investment in R&D as a proportion of GDP to 2.5% in 2014 it will need to take steps to significantly increase, not simply maintain, the total number of STEM graduates, as well as the proportion of those graduates that go on to pursue careers in science, engineering and technology. Evidence suggests that the UK may need to produce at least 5,000 additional researchers each year.

26. The need to increase the number of academic researchers produced in the UK is made more urgent because, in common with most Western countries, the UK has an ageing workforce. This may have implications for the future supply of skilled personnel in STEM subjects. For example, the Royal Academy of Engineering found in its 2003 study, The Future of Engineering Research, that there was a "demographic time bomb" for engineering, "caused by growing numbers of academic staff reaching retirement age" and "exacerbated by the lack of UK engineering students wishing to follow academic careers". According to the Academy, although "an increase in recruitment rates of between 22% and 36% over the next seven years [from 2003] is required just to maintain the current numbers of staff", in reality "many institutions already have severe difficulty in recruiting and retaining staff in engineering-related subjects". Furthermore, the percentage of staff under 30 almost halved between 1995 and 2000.[50] This study was supported in evidence to this inquiry by the Association of University Teachers, which told us that "the UK academic profession is generally getting older, with 23 per cent aged 50-plus in 1995—96, rising to 28 per cent in 2002--03. The ageing trend is seen particularly in the largest group of academics, who are engaged in both teaching and research. More than one-third of them are aged 50 and over".[51] These demographic trends serve to intensify the negative consequences of the declining popularity of STEM subjects and inevitably have an impact on the viability of university departments.

MATCHING SUPPLY WITH DEMAND

27. It is not sufficient simply to increase the quantity of STEM graduates on the employment market. Quality is also a factor. Research carried out by the then Department for Education and Employment (DfEE) in 1999 showed that "the great majority of mismatches between supply and demand for technical graduates are attributable to quality problems rather than any overall shortfall in quantity". It went on to observe that employer concerns about graduate quality related to a "lack of relevant work experience, followed by 'lack of commercial understanding/awareness' and 'weak communication and presentation skills'. Some concerns were also expressed about gaps in subject knowledge and understanding among weaker applicants".[52] As with attempts to increase the number of students on STEM courses, discussed in chapter 4, the drive to increase the volume of STEM graduates must not neglect quality considerations.

28. The focus of a large proportion of English universities is on research (see paragraphs 115 to 118). We received evidence from employers that universities' emphasis on research excellence meant that they were often failing to meet the needs of non-academic employers of STEM graduates. Thus ABPI told us that "university science departments which have been rated 5 or 5* for the quality of their research do not always produce high numbers of graduates who wish to pursue a career in science. Industry is most likely to value the skills and knowledge developed during a four year MChem/MSci 'sandwich' course". According to ABPI the focus of many employers is not so much on "qualifications" as on "practical skills and depth of knowledge".[53] The necessity of providing a diversity of course options with varying degrees of focus on research, scholarship and applied skills, will be discussed in more detail in chapter 6.

29. Many employers of STEM graduates are looking for highly specific skill sets in their potential employees. For example, the pharmaceutical industry is able to identify a particular requirement for increased numbers of in vivo pharmacologists (see paragraph 22). Astra Zeneca suggested that there should be a shift in the focus of the market for higher education: "graduate courses curriculum should be based on national needs linked to a clear strategy and not on market forces driven by students as 'customers' rather than 'products' of higher education".[54] However, there are a number problems associated with any attempt to precisely match employer demand to higher education output:

a) Breadth versus depth. Unless we resort to a wholly utilitarian (or "social engineering") model of education, and particularly in a climate where graduates can be expected to change jobs with relative frequency throughout their career, it can be assumed that a university course should do more than simply equip each graduate with the particular skills needed to do a particular job. Furthermore, as is illustrated in paragraph 52 of this Report, the majority of students do not choose their university course on the basis that it will equip them with the skills needed to do a specific job. There is no evidence to suggest that tailoring courses to the requirements of specific jobs would attract students to them. To a certain extent, employers will always bear some of the responsibility for job-specific training.

b) Multiple skills applications. As the DGRC told us "there is not a one-to-one correlation between what people do in a degree and what sort of job they do".[55] There are many careers that would make use of the skills acquired by, for example, an astrophysicist, at university. Not all of these jobs would have "astrophysicist" in the job title. This mismatch complicates the task of planning for future skills requirements.

c) The evolving marketplace. Organisations adapt in response to emerging technologies and changes in market conditions. A company that needs to employ six graduate chemists one year might need mainly mathematicians in the next. The goalposts are constantly shifting. Any attempt to micromanage the supply of skills to meet employer demand will thus inevitably fail to keep up.

30. We asked the DGRC whether he thought that the supply of skills in the UK graduate market matched employer demand. He told us that "even on physics and chemistry where you might have expected I had done a reasonable amount of homework in advance of this meeting, I come clean and say that we cannot go very much beyond the anecdotal evidence of whether supply is meeting demand and what the demand is. […] Those numbers go up and down but I do not think we have good trend numbers".[56] For the reasons enumerated above, we can understand why the DGRC would not have any figures detailing the specific numbers of graduates needed in each discipline in order to meet the particular requirements of employers. Nonetheless, the vagueness of his answer surprised us. The Government created Sector Skills Councils precisely in order to improve its management of the interplay between supply and demand in the employment market. Sector Skills Councils are independent, UK-wide organisations developed by groups of influential employers in business and industry sectors of economic significance. They are licensed by the Secretary of State for Education and Skills, in consultation with Ministers in Scotland, Wales and Northern Ireland, to tackle the skill needs of their sector. Their four key goals are:

To reduce skills gaps and shortages;

To improve productivity, business and public service performance;

To increase opportunities to boost the skills and productivity of everyone in the sector's workforce, including action on equal opportunities; and

To improve learning supply, including apprenticeships, higher education and national occupational standards.[57]

There are currently two Sector Skills Councils with a focus on science and engineering: SEMTA and e-skills UK, which focuses on the IT industry, IT users and IT professionals.

31. Each Sector Skills Council will develop Sector Skills Agreements, which will "provide the framework for [Sector Skills Councils] to work with employers in their sectors, with key agencies like HEFCE and with Government to address priority skills issues". In preparing their agreements, the Councils have already done a significant amount of work in assessing the main gaps and weaknesses in the development of the workforce of their sectors and have identified priorities for skills development. DfES told us that it is currently working with the Sector Skills Councils and HEFCE to "agree how industry can engage more fully in the design of courses, for example via HEFCE's HE Academy".[58] Given the frequent mismatch between the skills possessed by graduates and the requirements of the jobs that they are employed to fill, some input by employers into the design of courses is essential. Armed with a better understanding of what employers need, universities can ensure that they equip their students both with a good all-round education and with the specific skills that they will need when they enter the workforce. In response to further questions, the Regional Development Agencies suggested a number of ways in which the Sector Skills Councils could influence higher education courses:

Stronger advisory input to Funding Councils;
Kite-marking of employer-led courses;
Encouraging employer engagement and coordinating business input to course delivery through lectures/presentations, tutorials, projects and work-based placements; and
Increasing demand for these courses through improved careers advice and guidance in schools (see paragraphs 67 to 71).[59]

The Sector Skills Councils should help the Government and universities to improve their management of the interplay between the supply of, and demand for, graduate skills. In particular, we recommend that they develop a system of "kite marks" for employer-led higher education courses. This would send out much clearer signals to students about the likely value to their future career of the course that they choose. It would also help to avoid the problems associated with the over-provision of courses such as those in forensic science relative to the number of jobs available.

32. Given the information that is currently available, it is extremely difficult to gain a clear view of the interaction between supply and demand in the UK employment market. Whilst there is an abundance of statistics from different sectors and perspectives, these do not amount to a coherent picture. This is not a sound evidence base from which to establish a policy. We recommend that the Government undertakes a comprehensive survey of existing research into the supply of, and demand for, STEM skills, including lessons learned from other countries. This will enable it both to take stock of the current situation, and to form a strategy that will meet the UK's future skills needs.

SCHOOL SCIENCE TEACHERS

33. One of the sectors for which the Government does have clear data on the extent of the skills gap in science, engineering and technology is teaching. In particular, there is a problem with the supply of school science teachers with undergraduate qualifications in a STEM subject: science is being taught in many schools by teachers without these qualifications. In its Investment Framework, the Government notes that "in January 2004, there were still 240 unfilled science teaching posts in England, more than for any other subject except mathematics".[60] ABPI told us that, "for chemistry, the number of teachers who have a degree in the subject has also decreased, from 6,490 in 1984 to 3,744 in 2002. On the assumption that there should be a balance of expertise in science teaching at GCSE (Key Stage 4), it was calculated that, in 2002, approximately 8,350 chemistry teachers were required to cover teaching at GCSE and A level, whereas only 4,680 teachers in maintained schools had a degree, PGCE or BEd in chemistry".[61] One reason for the shortfall in physics teachers was suggested by Professor Peter Main of the Institute of Physics: "you just cannot get physics graduates to become school teachers and the reason for that is quite simply that they can do other things with higher salaries and less hassle".[62] Difficulties with teacher recruitment and retention are not simply a result of salary levels. As has been reported recently in the press, many teachers are demoralised by a range of factors, including classroom conditions and unruly behaviour.[63]

34. In its Science and Innovation Investment Framework 2004-2014, the Government announced a number of measures to increase the number of STEM graduates going on to become teachers. These are:

To increase the value of the teacher training bursary for science graduates from £6,000 to £7,000 from September 2005;

To raise the "Golden Hello" for new science teachers from £4,000 to £5,000 for trainees who enter PGCE or equivalent courses from September 2005 onwards; and

To eliminate as far as is possible the undershooting of the national Initial Teacher Training Targets for science by 2007-08.

These measures expand upon an earlier package of incentives that the Government believes "has brought about real change in recruitment into science teaching".[64] Whilst any measures designed to increase the number of science teachers are welcome, it is not clear that the decisions to increase the teacher training bursary and the "Golden Hello" for science teachers by £1,000 each is based on any research about the level of incentive that would be required to stimulate new demand. Instead of arbitrarily increasing by a round number the amount of money given to trainee and new teachers as a financial incentive, the Government should gather evidence on the level of incentive that is required to achieve the necessary increase in school science teachers.

35. We questioned witnesses about the effectiveness of financial incentives at increasing the number of teachers in shortage subjects. The Minister of State for Lifelong Learning, Further and Higher Education told us that "in the year 2000 there were 2,220 PGCE science recruits; this year there are 2,690. It is not a massive increase but I do not think we would expect one".[65] However, a Report published by the Education and Skills Committee in 2004 noted that, despite the introduction of financial incentives, "there were still shortfalls in recruitment in the shortage subjects of mathematics, physical sciences, modern foreign languages and religious education".[66] Furthermore, a Higher Education Policy Institute paper states that, since the introduction of the scheme, despite increases in the number of PGCE students, "there has been a significant decline in undergraduate [Initial Teacher Training]".[67] In other words, some of the increase in uptake of postgraduate teacher training is offset by decreases in the number of students undergoing teacher training at undergraduate level. Schools are also currently experiencing problems with the retention of their newly qualified teachers. The Education and Skills Committee reported that "we heard in evidence that fewer than 50% of those who begin teacher training are teaching after five years".[68] The Government is to be commended for taking action to increase the number of school science teachers. There are signs that its incentives are having some positive effect on overall teacher recruitment levels, despite continuing problems in some subjects. However, difficulties in retaining newly-qualified teachers suggest that financial incentives are not a long term solution to teacher shortages. The effectiveness of financial incentives is discussed further in paragraphs 72 to 75.

Graduate choices

36. Equipping graduates with STEM skills does not necessarily mean that they will go on to pursue careers in science, engineering and technology. To a certain extent this is desirable: as is explained in paragraph 9, one of the functions of university STEM courses is to raise the level of general scientific literacy in the public, not simply to send graduates into scientific careers. This is what Professor David Walton of Coventry University argued when he told us that "the ex-student need not still be working in the field of science to be a net earner for the country, and so represent a good 'value-added' return on the costs of education".[69] However, the evidence we received suggested that too many STEM graduates from English universities are choosing not to pursue careers in science, contributing to existing skills shortages in specific areas. Professor David Eastwood, Vice Chancellor of the University of East Anglia, told us that "if we are looking at market effects here, universities are producing more than enough chemists to over stock schools with chemistry teachers but they are making different career choices".[70]

37. The evidence that we collected did not present a clear picture of why not enough STEM graduates go on to pursue related careers. One of the explanations offered was a lack of "pull" from business. A research paper produced by the Higher Education Policy Institute states that "a demand-pull from UK businesses is needed alongside an increase in supply of highly skilled individuals".[71] The Russell Group of universities told us that "many graduates in science, and not least in chemistry, presently choose to go straight into well-remunerated careers outwith science, and career salaries within science show little sign of the upward movement that would reflect any general skill shortage".[72] The lack of "pull" identified by the Russell Group relates to salaries: many witnesses argued that science careers do not attract graduates because they do not tend to pay well. (This does not necessarily contradict the Royal Society of Chemistry and the Institute of Physics, which have found that, over the course of their careers, chemistry and physics graduates earn a salary premium of 15% above non-graduates, as compared to a salary-premium of 12% for the "average" degree holder. The research does not track whether the graduates surveyed pursued careers in science or in other sectors.[73]) Good salaries are undoubtedly one of the levers that employers can use to attract potential recruits. However, evidence from other sectors suggests that there are other, perhaps more important, levers. In the public sector and the media, for example, many graduates compete fiercely for jobs that pay relatively little.

38. The factors that influence graduates when they choose a career are likely to be as complex as those that influence school leavers when they choose a university course (see chapter 4). Many of these factors will be less tangible and harder to address than salary considerations. In order to formulate a credible policy on attracting graduates into careers in science, engineering and technology, the Government needs to develop a sophisticated understanding of the motivating factors in graduates' choices of careers. Given that they are in the best position to act upon any findings, we recommend that the Government commissions the relevant Sector Skills Councils to carry out further research into these factors.

Research careers in STEM subjects

39. The Committee identified a fundamental reason why many STEM graduates decided not to pursue research careers in a 2002 Report entitled Short-term Contracts in Science and Engineering.[74] We found that postdoctoral researchers were frequently employed on a series of short term contracts with minimal job security and poor pay and conditions, and concluded that this was a serious disincentive to anyone considering a research career in the long term. We have tracked the Government's progress in tackling this issue as part of our ongoing scrutiny of the Research Councils and of the Office of Science and Technology. In our Office of Science and Technology: Scrutiny Report 2004 we concluded that "the Government needs to have a number of policy ideas at its fingertips should [it] identify a continuing problem with short-term research contracts in science and engineering. We are very concerned that an over-reliance on the perceived benefits to be realised from the introduction of the EU Fixed Work Term Directive will hold back any new Government initiatives to address this problem".[75] During the course of this inquiry, many witnesses raised the same issues that we identified in our 2002 Report. For example, Ian Hutton, one of the panel of students we saw on 7 February, told us that "I have considered the career prospects and the job prospects after having done, say, a PhD and then several post-docs, a lot of them seem to bounce around from contract to contract with no real security, and if I had worked that hard to get that qualified and have a PhD then I would want to find myself in a more stable environment than that".[76] Very little time has elapsed since our last comment on research careers and we cannot reasonably expect the situation to have changed much since that time. However, this is an issue that the Government will need to continue to work on, particularly if it is serious about attracting more students onto STEM courses and into research careers. Ian Hutton's comment also reveals that it will be important for the Government to address negative perceptions about research careers. Without specific action in this area, it could take a long time for any improvements in research career paths to filter through to schoolchildren and students making choices about their future careers.