APPENDIX 95
Supplementary memorandum from the Department
for Education and Skills
DEMAND AND
SUPPLY OF
SET GRADUATES
The Roberts review was commissioned at the time
of the 2001 budget as part of the Government's strategy for improving
the UK's productivity and innovation performance. It stemmed from
the Government's concern that the supply of high quality scientists
and engineers should not constrain the UK's future R&D and
innovation performance.
The review, published in April of 2002, found
that in comparison to other countries, the UK has a relatively
large and growing number of students studying for scientific and
technical qualifications. However this growth is primarily due
to the increases in the numbers studying IT and the biological
sciences, with the overall increase masking downward trends in
the numbers studying mathematics, engineering and the physical
sciences.
Coupled with this finding that the supply of
graduates from certain subjects are falling the report also found
that scientists and engineers in the UK are in demand from a wide
range of sectors, not just the conventional higher education and
R&D occupations, but also from sectors such as financial services
who are increasingly demanding highly numerate graduates and postgraduates.
Figure 1 shows the destination for first degree
graduates entering employment in 1999/00. It illustrates that
in many science and engineering subjects over half of all new
graduates enter employment working in "R&D manufacturing".
Maths and physics graduates can also be seen to be the most likely
of this group to enter the financial service sector, which is
consistent with the highly numerate and problem solving nature
of these degrees.
Focussing on the needs of the higher education
sector, the Roberts review worked in collaboration with HEFCE
to develop a model of the stocks and flows of academic staff in
UK HEIs. The ageing demographic profile of the academic workforce
is of significant concern as it is likely to create staffing problems
in future years. 16% of academic staff were due to retire within
10 years in 1999-2000, and this figure increases when we constrain
ourselves to look at certain sciences. For example over 25% of
the academic staff teaching Maths, Physics or Chemistry were over
55 in 1999-2000.
Table 1 shows the actual and forecast inflows
by SET discipline in 1998, 2005 and 2010. It illustrates the varying
picture across subject groups with the most critical need arising
in Mathematics and Engineering, which require a 33% and 22% increase
in inflows in 2010 respectively, in order to preserve the 1998
staffing figures. To meet this forecast demand of maths academics
in 2010 the Roberts review estimates that institutions would have
to recruit just over 50% of the 1998-99 output of Maths PhD students.
RETURNS TO
HE
A further indicator of the relative demand for
graduates of certain subjects is the returns that they receive
in the labour market. Figure 2 illustrates that Maths and male
Engineering graduates enjoy a return significantly higher than
the average (male) return to HE, indicating that demand for graduates
in these disciplines is relatively high.
RECRUITMENT DIFFICULTIES
AND SKILLS
SHORTAGES
A study by Mason (1999) found that some 41 percent
of recent recruiters of technical graduates reported that they
had some difficulty in meeting their recruitment targets. The
main areas of expertise reported in shortage all involved electronics
and/or software engineering, design and programming.
The table below taken from Mason (1999) shows
the incidence of recruitment difficulties by sector and the extent
of these difficulties.
Table 2
|
| Percent of recruiters reporting:
|
| Sector | "Very Difficult"
| "Difficult" |
|
| Electronics | 20
| 37 |
| Machinery | 8
| 33 |
| Pharmaceuticals | 10
| 23 |
| R&D Services | 13
| 30 |
| Computer Services | 10
| 27 |
| Financial Services | 5
| 26 |
|
QUALITY VS
QUANTITY IN
THE SUPPLY
OF SET GRADUATES
Across the whole sample of recruiting enterprises in the
Mason (1999) study, the estimated median number of applications
received for each advertised position for a technical graduate
ranged from 29 (physical sciences) to 46 (computer science). So
this hardly suggests a deficiency in the quantity of technical
graduates.
Electronic engineering was the only discipline in which the
report found an apparent shortfall in the quantity of graduates
due to the very specific nature of the job they were being recruited
for. In the other disciplines recruitment difficulties appear
to have more to do with quality shortcomings than any overall
deficiency in supply.
Just over three quarters of firms within the survey that
had recruitment difficulties reported some dissatisfaction with
the quality of job applicants, in particular their "lack
of appropriate work experience" followed by "lack of
commercial awareness/understanding" and "weak communication
and presentation skills".
Recent unpublished research commissioned by the DfES asked
a sample of employed graduates 3.5-4 years after they had graduated
the extent to which certain skills were developed on their undergraduate
course and subsequently how much they were used in their current
employment. It found that just over 80% of respondents found spoken
communication skills were used a lot in their current jobs, however
only just over 35% of respondents thought that such skills had
been developed a lot on their undergraduate course,[83]
so this problem of weak communication skills may extend beyond
just SET graduates.
FACTORS AFFECTING
SELECTION
As part of the Mason (1999) report recruiting firms were
asked to rank their selection criteria on a scale of one to four,
with one being not at all important and four being very important.
Table 2 shows the employment weighted average ranking given to
the various factors.
Table 3
|
| Employment Weighted Average
|
|
| Class of Degree | 3.34
|
| Previous work experience (eg sandwich placement)
| 3.03 |
| A level Score | 2.77
|
| Reputation of Specific University | 2.69
|
| Whether candidate attended Old or New University
| 1.78 |
|
Larger employers were more likely to attach greater importance
to a university's reputation and this was further borne out by
the pattern of response to a question about the extent to which
enterprises target specific university departments in the course
of their recruitment campaigns. But even after allowing for the
employer's size the reputation of the graduate's university is
clearly deemed less important that their class of degree and relevant
work experience.
So do graduates benefit from attending the more prestigious
universities?
Analysis looking at graduates more widely has discovered
that even after controlling for individuals' personal characteristics,
graduating from a Russell Group Institution adds between 0 and
6% to male graduate earnings compared to graduating from a modern
university. The respective figure for a female is around 2.5%.[84]
March 2005
83
The Class of 99: A study of the Labour Market Experience of recent
graduates: unpublished. Back
84
Conlon and Chevalier (2003) Does it pay to attend a prestigious
university, CEE discussion paper. Back
| 
