CHAPTER 4: Supply and demand in STEM
Higher Education |
50. In 1969, the then Prime Minister, the Rt
Hon Harold Wilson MP (later Lord Wilson of Rievaulx), said:
"First we must produce more scientists, secondly
having produced them we must be a great deal more successful in
keeping them in this country. Thirdly, having trained them and
kept them here, we must make more intelligent use of them when
they are trained, than we do with those we have got, and fourthly
we must organise British industry so that it applies the results
of scientific research more purposefully to our national production
51. There are two main aspects to consider when
analysing supply and demand in STEM HE. First, whether the UK
is producing enough STEM graduates and postgraduates to satisfy
demand; and, secondly, whether those graduates are of sufficient
quality, and have the right skills, to meet the needs of employers.
In this chapter, we consider the first issue. The second is discussed
in Chapter 5.
Higher education and STEM
52. According to the Government, a fundamental
principle of the HE system is that HEIs are:
"autonomous, self-governing institutions. It
is for them to make their own decisions about the courses they
provide; their admissions policy; to implement their own funding
strategies and to make the necessary decisions to ensure they
are responsive to student choice and that their institutions can
continue to flourish. These decisions will affect STEM at both
undergraduate and postgraduate level."
53. This principle implies that the Government
cannot dictate directly to HEIs the courses they should offer.
However, because HEIs are the recipients of substantial amounts
of public money in the form of grants, subsidies and student loans,
the Government have a number of levers with which they are able
to exert influence over the HE sector (see paragraphs 94-104
and Chapter 5). Crucially, in an autonomous system, employers
also have an important role to play in attracting STEM graduates
and defining the needs of their organisations.
54. Several attempts have been made over the
decades to tackle some of the issues raised in this report, many
with similar conclusions and recommendations, notably the Robbins
Report in 1963, the
Dearing Report in 1997
and the Roberts Review in 2002.
55. In 1963, the Robbins Committee identified
four objectives of HE: instruction in skills for employment; promoting
the general powers of the mind; advancing learning; transmitting
a common culture and common standards of citizenship.
To a large extent, these objectives continue to apply. The Robbins
Committee chose to make "instruction in skills for employment"
the first objective, not because it was the most important, but
because they believed it was often ignored or undervalued. The
report stated: "we deceive ourselves if we claim that more
than a small fraction of students in institutions of higher education
would be where they are if there were no significance for their
future careers in what they hear and read; and it is a mistake
to suppose that there is anything discreditable in this".
Nearly 50 years later, there is still a tension between those
who advocate that HE should "train" students for their
first job and those who take the view that HE should primarily
56. The Dearing Report adapted the Robbins Report
objectives, stating that:
"The aim of higher education should be to sustain
a learning society. The four main purposes which make up this
- to inspire and enable individuals
to develop their capabilities to the highest potential levels
throughout life, so that they grow intellectually, are well equipped
for work, can contribute effectively to society and achieve personal
- to increase knowledge and understanding for their
own sake and to foster their application to the benefit of the
economy and society;
- to serve the needs of an adaptable, sustainable,
knowledge-based economy at local, regional and national levels;
- to play a major role in shaping a democratic,
civilised, inclusive society."
The conclusions of the Dearing Report suggest that
training for employment and education are both key outcomes of
HE. We share that view.
57. The Roberts Review, SET for success,
looked at the supply of science and engineering skills throughout
the education system. Most notably, the Review made a series of
recommendations that lead to the introduction of a new funding
stream to improve the employability skills of postgraduates.
QUALIFICATIONS IN HIGHER EDUCATION
58. There are a number of qualifications which
students can gain in HE. In general, they are classified as either
undergraduate (first) and postgraduate (higher) degrees (see Figure 2).
First degrees have, in the past, usually lasted three years and
resulted in a Bachelors degree. There has, however, been a move
towards four year courses in STEM subjects, particularly engineering,
leading to an integrated Masters degree and increasingly Masters
are seen as a prerequisite for postgraduate study internationally.
Such a degree, or its equivalent at Masters level, is essential
to achieving Chartered status in engineering and some other areas.
59. After completing a first degree, graduates
have the option of continuing their education either through a
taught Masters degree or through research. A research Masters
degree usually takes a year, after which a student may progress
to a doctorate (PhD); alternatively, a student may go directly
to studying for a PhD. A PhD may take three to four years. In
HESA data, these two routes are classified as "postgraduate
research courses". Taught Masters are classified by HESA
as "postgraduate taught courses". The purpose of a taught
Masters degree is said to be threefold: to specialise in a specific
subject or area, to convert from an expertise in one discipline
to a degree in a second discipline, or to enhance a Bachelors
degree to qualify for a "license to practice" in an
area such as engineering. Doctoral graduates may chose to enter
general employment or take a post-doctoral position with a view
to pursuing a career in academia.
Qualifications in higher education
60. The overall number of "qualifiers"
(that is, students who have qualified for their award (graduates))
in STEM subjects at undergraduate level in HE has increased from
approximately 118,000 in 2002-03 to over 140,000 in 2009-10; although,
as a percentage of the overall number of HE students, the number
decreased slightly from just over 43% in 2002-03 to just under
42% in 2009-10 (see Figure 3). These figures are based on
a broad definition of STEM subjects (see Chapter 3). To achieve
a better understanding of the growth in the uptake of STEM subjects,
it is necessary to disaggregate them (see, as an example of disaggregation,
STEM qualifiers (UK and overseas) from
Number and proportion of UK domiciled
of some STEM subjects
61. Data in Table 2 set out in Appendix 6 to
this report reveal a decrease or no growth in the number of UK
domiciled first degree qualifiers in engineering (-3%) and chemistry
(0%) over an eight-year period, from 2002-03 to 2009-10. This
is in contrast to an increase in qualifiers for all subjects of
20%. In particular, the number of students studying computer science
has dropped by 27%. On a more positive note, there has been an
increase in the number of mathematical sciences qualifiers of
11% over the period and a similar 11% increase in physics. This
is a turnaround from the previous decade when there was a significant
drop in the number of students studying these "core"
STEM subjects from 1995 to 2000.
However, this increase is from a low starting point and each subject
still represents a very low proportion of the overall STEM figure
(with only 2,290 students acquiring a first degree in physics
and 5,175 in maths out of the total of 122,940 studying STEM subjects
in 2009-10). We note that there have been very large increases
in student qualifiers in sport science, which make up a significant
proportion of the number studying biological sciences (up 122%,
from 3,650 to 8,120) and forensic and archaeological science (up
349%, from 360 to 1,615) over the same period.
62. The number of UK domiciled STEM Masters degree
qualifiers has risen by 30% over the same eight-year period (see
Table 4). This is in contrast to a 34% increase in the number
for non-STEM subjects. There has also been a significant decline
in the number of qualifiers in computer science (-45%) and chemistry
(-12%) with little growth in the mathematical sciences (2%). Engineering
increased by 37% and physics by 43%. Again, there have been very
large increases in the number of qualifiers in sports science
(172%) and forensic and archaeological science (94%). This data
relates to UK domiciled qualifiers only. The trends look very
different when taking into account EU and overseas students (see
63. Table 6 shows increases in the number
of UK domiciled PhD qualifiers across the board, with a 15% increase
in STEM subjects and 15% increase in non-STEM subjects between
2002-03 to 2009-10. There are some areas of concern. PhD degree
qualifiers in chemistry, for example, decreased by 11% while biology
qualifiers decreased by 16%. There was also little growth within
64. Historical data on the trends in student
numbers in STEM reveal that overall there has been an increase
in the number of STEM students, although a significant proportion
of that growth has taken place in what the Government describe
as the "softer sciences", such as sports science and
forensic science. There has been relatively little growth in traditional
or "core" sciences, such as engineering and a decline
in computer science.
LACK OF DATA ON THE SUPPLY AND DEMAND
FOR STEM GRADUATES AND POSTGRADUATES
65. Several witnesses commented on the limited
data available on the supply and demand for STEM graduates.
The Wellcome Trust, for example, said: "there is a paucity
of quality data when it comes to understanding the supply and
demand for STEM graduates ... Data sets are not well integrated
On the supply of graduates, the UK Deans of Science stated that
"although some data is collected on student numbers (for
example, by the HESA on undergraduate and postgraduate students
and by HEFCE on doctoral completion rates) we are not aware of
any detailed data being collected and properly analysed on an
LGC, a STEM employer, made a similar complaint about linking supply
with demand data:
"We are not aware of any government-facilitated
mechanism to feed our demands for graduate skills into the education
system, and influence the supply of training. Whilst manpower
planning does not seem a realistic proposition, provision of reliable
data addressing sector-specific trends in supply of, and demand
for, STEM graduates and post-graduates would be of use to all
the different communities with vested interests in understanding
and addressing labour market gaps and dynamics."
66. HESA maintains a database of all students
enrolled on undergraduate courses at HEIs derived from annual
returns made by the institutions. Various statistics based on
these data are publicly available from the HESA website. Other
bespoke statistical data can be produced on request at a cost.
HESA is a "private limited company which has formal agreements
with Government departments to provide the data which they require,
and it is funded by subscription from all of the universities
and higher education colleges throughout the United Kingdom".
While their mission is to ensure that stakeholders "have
easy access ... to a comprehensive body of reliable statistical
information and analysis about UK higher education",
some witnesses such as Professor Andrew George of Imperial
College London, were critical of the data collected, how they
are collected, what information is made freely available and its
format, and the time lag in its publication.
67. The Headmasters' and Headmistresses' Conference
(HMC) told us that "it is notable that in HESA data generally
there are large numbers of unknowns for some of the categories
where reasonable completeness might have been expected".
The British Computer Society (BCS) described HESA employment statistics
for computer science as "misleading" and said that they
over-estimated the true unemployment situation for computer science
graduates "because degrees with very little computer science
content are bundled with true computer science degrees when calculating
We were also frustrated by the inability to disaggregate data
beyond the high level subject categories to determine where graduates
progress following their studies.
68. The data available about the supply and demand
for STEM postgraduates are also weak. Witnesses told us that data
collected about higher degree graduates in general are either
insufficient or have little meaning. The Academy of Medical Sciences
(AMS), for example, told us that "to understand the benefits
of postgraduate education and training, UK HEIs should develop
and implement a simple system of tracking postgraduates. More
data on workforce numbers would allow more strategic appraisal
of capacity and re-profiling needs".
69. Professor George, speaking about the
data collected by HESA, said: "the data is very poor at the
moment ... we collect data, but it is not very good data because
the HESA rules for collecting data on postgraduate students make
no sense at all".
He called for data to be collected in such a way as to enable
differentiation between stand-alone Masters courses, research
Masters and PhDs. The UK Deans of Science, and other HE representatives
from University College London (UCL) and Cranfield University,
made a similar point.
With regard to destination surveys of postgraduates, it has been
suggested that information about the destination of postgraduates
six months after graduation gives "a completely wrong picture"
because they are usually writing their theses.
The University of Greenwich told us: "there is no consistent
means of collecting employer demand or graduate destinations for
70. Ministers were also critical of HESA. Damian
Green MP, Home Office Minister for Immigration, was surprised
at the time lag between collection of data and their availability:
"every university must know on 1 October who has arrived,
what subjects they are doing, where they are from and so on. Nevertheless,
the body that is responsible for collecting the data cannot produce
them until 18 months afterwards. ... I find that surprising".
The Rt Hon David Willetts MP told us with regard to the time
lag: "we are investigating whether there are changes we can
make to improve that situation. It is an understandable frustration".
On the usefulness of HESA data he said:
"I accept that this is a problem; at the moment
everybody is unhappy. Universities complain about the burden of
data collection. Some data that they collect and send up to the
centre are never referred to again, so they complain to me that
they are collecting data to no purpose. On the other hand, you
are absolutely right that elementary data about outcomes and employment
prospects from doing particular courses at particular universities
that prospective students should have is very hard to obtain.
We are working on this."
71. Lord Sainsbury of Turville, former Science
Minister and businessman, told us:
"[there is a] pressing need for the key stakeholders
(including young people, university vice-chancellors, and policy-makers)
to be regularly presented with reliable, useable data and market
intelligence about the supply of, and demand for, STEM graduates
... a single agencyprobably HEFCE [the Higher Education
Funding Council for England] or UKCES [the UK Commission for Employment
and Skills]must be tasked by Government to collate all
of the relevant information and data from the numerous different
agencies which currently collect it. This same agency should further
be required to publish, annually, a small set of highly readable
digests of the information. It is not possible to do long-term
manpower planning, but it is important if the labour market is
to work well that everyone has information on the current position
... There is a need for regular, reliable and comparable data
and market intelligence on the supply and demand of STEM graduates."
72. The lack of reliable data on the supply and
demand for STEM graduates and postgraduates makes it very difficult
to assess whether there is a shortage of STEM graduates and postgraduates,
and in which sectors. More needs to be done to identify areas
of shortage so that remedial action can be taken and to enable
students to make informed choices about whether the courses they
are considering will equip them with the skills needed by employers.
73. We recommend that the Government appoint
a single body (or amalgamates the efforts of existing bodies such
as HESA, UCAS, UKCES, CIHE, the Higher Education Careers Services
Unit (HECSU) or the new National Centre for Universities and Business)
to be a repository of relevant information currently collected
by different agencies on the supply and demand for STEM graduates
with a view to providing comprehensive, real time data analysis
and a commentary with market intelligence of where STEM shortages
exist, broken down by sector. This body should provide yearly
updates to HEFCE, Government and other stakeholders on skills
shortages so that remedial action can be taken to protect, or
grow, those STEM areas which are needed to support economic growth
and where market failure means that supply does not meet demand.
All these data should be accessible to all stakeholders in order,
amongst other things, to inform student choice.
74. We recommend that this body should also
be responsible for holding, monitoring and analysing data for
postgraduate education, including the employment of qualifiers
from postgraduate courses on an ongoing basisdisaggregated
into PhD, research Masters and taught Masters, and by subject
75. We urge HEIs to contribute to the provision
of data to this body by putting in place a robust, long-term tracking
system for postgraduate provision and destination data.
Supply and demand in undergraduate
76. There has been much debate about whether
the growing supply of graduates meets the demand for STEM skills
within the economy and about how demand might change in the future.
STEM graduates and postgraduates are reported to be in high demand
by both STEM and non-STEM employers for their analytical thinking,
problem solving skills and numeracy as well as for their technical
skills or subject specific skills.
The CBI found that 41% of recruiters prefer to recruit STEM graduates
and are willing to pay a premium for people with qualifications
77. STEM skills also feature heavily in the Government's
future plans for growth and various broad projections for future
demand for STEM skills to meet these needs have been made.
The 2010 UKCES National Strategic Skills Audit highlighted a number
of areas of growth in the economy within both STEM and non-STEM
sectors that will require STEM skills, including advanced manufacturing,
life sciences and pharmaceuticals, low carbon economy, professional
and financial services, digital economy and engineering and construction.
A CBI report, Mapping the route to growth, estimated that
80% of new jobs are in high-skill areas and require high-tech
graduates, and that over half of the jobs to be filled in the
UK to 2017 will require people to hold graduate level qualifications.
Forecasts for industries in science, technology and engineering
alone show a demand for 600,000 professionally trained skilled
staff by 2017. According to the CBI, the number of those studying
degrees in these areas "must increase by over 40% on current
levels if this demand is to be met".
78. Although, as we have said, a lack of data
makes assessment of the supply and demand for STEM graduates and
postgraduates difficult, the evidence we received suggests that,
despite the increased number of STEM graduates over the last 10
years, employers are still having trouble recruiting STEM graduates.
The CBI, for example, reported that 43% of employers said they
were having difficulties.
We, therefore, asked where the STEM graduates were working.
79. In 2009, BIS published a study, The Demand
for Science, Technology, Engineering and Mathematics (STEM) Skills,
which addressed this issue. The study concluded that the shortage
of STEM graduates was specific to certain areas such as engineering
and IT, and varied according to region. It is not possible, therefore,
to draw many conclusions about supply and demand from national
level surveys. We also received evidence of reported shortages
in the number of graduates with skills to meet the needs of STEM
specific sectors such as the computer gaming and visual effects
industry, power electronics sector and nuclear engineering, as
well as in-vivo techniques, of interest to the pharmaceutical
industry. A number
of STEM skill areas also appear on the skills shortage occupations
list produced by the Migration Advisory Committee, including engineering
The 2009 National Employer Skills Survey for England showed that
31% of high-tech manufacturing firms were recruiting people from
outside the UK because of a lack of suitably qualified people
within the UK.
STEM GRADUATES IN NON-STEM EMPLOYMENT
80. Classifying employers into STEM and non-STEM
is not straightforward. However, it is clear that a substantial
number of STEM graduatesalmost halfchoose to take
up employment in what have traditionally been considered non-STEM
areas, such as the financial sector. We acknowledge that there
are benefits to STEM graduates working in non-STEM jobs in that
they increase the overall scientific literacy of the workforce.
It is, however, a cause for concern if the diversion of a significant
number of STEM graduates away from STEM jobs means that the UK
is not equipped with the skills it needs to meet future plans
for growth within high-tech sectors. We, therefore, considered
why STEM graduates are attracted to non-STEM jobs.
81. The issue was the subject of a research paper
published by BIS in March 2011, STEM graduates in non-STEM
jobs, which concluded that there was no "clear or simple
main reason why some STEM graduates are not in STEM jobs"
and that the decision-making process that graduates went through
was complex; many factors were at play but "the most likely
one" was that students and graduates found non-STEM work
"potentially to be more interesting".
The research paper also said that the two main reasons seen by
employers for STEM graduates to decide against specialised STEM
jobs and careers were "the perceived greater attractiveness
of careers outside STEM (not least the perception of higher salaries)
and the graduates' lack of real knowledge about working in STEM
This is worrying for STEM sectors trying to attract the highest
quality STEM graduates into their areas. More promisingly, however,
the report concluded that salary was not the leading factor in
a student's decision-making process. There is, therefore, scope
for employers to play a greater role in raising awareness of STEM
careers amongst graduates and offering both financial and non-financial
incentives to attract them to STEM sectors. We discuss the role
of employers in raising awareness of STEM careers in paragraphs
ARE THE BEST GRADUATES ATTRACTED
TO STEM JOBS?
82. Current HESA data do not show where the best
and brightest STEM students (according to degree level) end up.
The evidence is only anecdotal. However, we imagine that STEM
employers and the Government would be concerned if the top STEM
graduates go into non-STEM jobs for the reasons described above.
At present, 4% of physical sciences graduates, 2% of engineering
graduates, and 20% of mathematical sciences graduates go to the
it is not known if this includes the top performers in each discipline.
Although the BIS paper concluded that salary was not the leading
factor in a student's decision-making process, it will be for
some students and it has been suggested that STEM employers in
certain areas are not paying enough to attract the best STEM graduates.
The Institute of Physics, for example, told us that, to compete
with non-STEM, STEM employers "have to offer better pay,
which certainly has been the case with the financial sector, which
has openly recruited the best physics PhD graduates".
83. We recommend that the Government commission
a study to find out the first destination of STEM graduates with
a first degree (by degree class) as well as postgraduates. The
study should also attempt to find out the reasons that lie behind
students' career choices. This information would help to explain
what makes STEM graduates and postgraduates choose non-STEM jobs
and allow STEM employers to take action to attract the best and
brightest into STEM careers, particularly research.
THE SUPPLY OF THE "SOFT"
84. A significant proportion of the growth of
STEM graduates in recent years has occurred in newer courses,
rather than the more traditional STEM subjects, which have reportedly
been popularised by, for example, television programmes on forensic
science or by changes in popular culture leading to an increase
in sports science courses.
The Government call them "soft STEM" courses.
Some witnesses argue that graduates from these courses are of
significant benefit to the economy because their general STEM
skills are just as much in demand as those of other STEM graduates.
It is also argued that such courses have attracted a greater number
of students to study STEM subjects. Dame Julia Goodfellow,
Vice-Chancellor of the University of Kent, for example, explained
how these courses attracted students who would not have otherwise
considered a STEM degree.
85. Others were more critical of the scientific
content of these courses. LGC, an employer of forensic scientists,
told us that: "the majority of these courses do not equip
students with the right fundamental technical skill-set for employment
in our laboratories".
LGC also said: "A set of courses have sprung up to appeal
to what people are envisaging is a good career in forensic science.
You can have a very good career in forensic science ... but the
way it is portrayed on television is not reality".
86. We have already drawn attention to the lack
of data about the career choices of graduates. Furthermore, the
difficulty in disaggregating "softer" science students
from those on other courses within the broader STEM categories
of the JACS system makes it hard to tell whether these "softer"
STEM courses are equipping students with the necessary STEM skills
to meet the needs of the economy. We have yet to be convinced
about the value added to graduates of "soft" science
courses, such as some forensic science and sports science courses,
and the value added to the economy, and it is not possible to
deduce from the available data whether employers in general, and
STEM employers in particular, value such graduates.
87. Given the significant number of students
choosing to study "softer" science courses, we recommend
that HEFCE and HEIs collaborate in conducting a study into the
career progression of students of new STEM courses (such as some
sports science and forensic science courses) to enable those undertaking
these courses to decide whether they are being equipped with the
skills graduates need to succeed in the STEM job market.
THE ROLE OF GOVERNMENT AND HEFCE
IN ENSURING SUPPLY OF STEM GRADUATES AND POSTGRADUATES MEETS DEMAND
IN TERMS OF QUANTITY
88. In an open market for graduates and postgraduates,
the onus is on employers to ensure that they pay the market rate,
or provide other means of attracting STEM graduates to stay in
STEM sectors. The Rt Hon David Willetts MP told us: "employers
should send out a clear signal about how much they value people
with these skills. They cannot completely escape that part of
However, where market failure occurs, the Government have a role
to play in ensuring that supply meets demand for STEM graduates,
particularly when their strategy for economic growth is based
on the existence of a healthy science base.
89. To this end, in 2005, the Government introduced
a policy on what were described as Strategically Important and
Vulnerable Subjects (SIVS)subjects about where there was
"compelling evidence of a requirement for action to enable
them to continue to be available at a level and in a manner that
meets the national interest".
Not all STEM subjects are SIVS. At present, they include: chemistry,
engineering, maths and physics within the STEM subjects, and modern
foreign languages, although in recent times biological sciences
and computer science have also received some support from this
spent £50 million a year (£350 million in total) over
seven years (2005-12) supporting SIVS while their teaching budget
for 2012-13 is £3.6 billion.
90. Examples of interventions since the policy
was introduced include: promoting demand and attainment among
potential students (for example through the National HE STEM programme);
securing and increasing the supply of provision (for example,
through additional teaching funding for very high cost and vulnerable
science subjects); and, monitoring and forecasting the provision
of SIVS. The third HEFCE Chief Executive's advisory group on SIVS
concluded in 2011 that, although "individual projects have
provided value for money and those on the supply-side appear to
have been particularly effective", it was "difficult
to disaggregate the impact of investments on the demand-side and
to establish whether there has been a sustainable resolution of
the root causes of vulnerability, for example levels of student
A further analysis in 2011 found that "SIVS have seen a continued
expansion, and at a rate higher than other subjects during recent
years. However, some concerns remain, for example among the engineering
and modern language disciplines".
91. The 1994 Group, a group of 19 research-intensive
universities, stated that SIVS "have seen positive effects
on raising the aspirations of young people to study these subjects".
It appears that the SIVS policy has been, at least partly, responsible
for raising the numbers studying SIVS. Universities UK told us:
"the strong policy focus given to STEM, through initiatives
such as HEFCE SIVS programme, is likely to have contributed to
... increasing student demand for and enrolment in STEM subjects
in higher education".
92. Some concerns about SIVS have been expressed.
Most are about the subjects included in the SIVS listfor
example, that biological science, computer science, geophysics
and physiology are not considered to be SIVS.
We are concerned that, given the importance that the Government
attach to STEM in their strategies for economic growth, they have
little obvious input to the decision as to which subjects are
to be afforded SIVS support. The Rt Hon David Willetts MP
told us: "in the time that I have been in Government alongside
the Secretary of State, I do not think that I have ever tried
to specify what should or should not be a strategically important
and vulnerable subject".
This approach differs markedly from the previous administration,
which set out strategic areas of provision in a letter to HEFCE,
which was then charged with determining which of these it considered
to be vulnerable and therefore in need of protection.
93. Following the HE reforms, HEFCE has adopted
a new approach to SIVS. In addition to supporting existing SIVS,
HEFCE will monitor the health of all subjects and make "selective,
collaborative interventions where there is strong quantitative
and qualitative evidence of a particular risk to the continued
availability of a subject".
It is unclear at this stage whether more funding will be allocated
to SIVS policies or whether the small pot of SIVS funding is going
to be spread more thinly. (HEFCE has also introduced measures
to support high-cost subjects, including STEM subjects.
94. CaSE called for additional funding for SIVS:
"we remain concerned that there are not enough
incentives for HEIs to increase STEM provision. Current policy
is predicated on student choice driving STEM provision, and while
we hope that this will indeed occur, we also argue that the importance
of STEM graduates to the UK's future is so great that additional
safeguards should be put in place. The simplest and most effective
change would be to increase the relative subsidy for SIVS from
95. The Engineering Professors' Council also
warned that "it will be important to ensure that funds provided
for SIVS and STEM initiatives are not used for other purposes.
STEM subjects generally need more funding than many othersdespite
typical student fees being the same for all subjects".
96. Sir Alan Langlands, Chief Executive
of HEFCE, offered some assurance:
"the HEFCE support for SIVS, but within that
the STEM subjects, I think is pretty secure for the next two or
three years. The Government have been clear that they want that
to continue to be a priority, to the point at which, even with
strains of competition and market running through some of their
veins, they have asked us to intervene to ensure that STEM subjects
are not damaged by the unintended consequences of the reform process."
97. It appears that SIVS policy has had a positive
impact on STEM and the Government should therefore continue to
support the initiative. There are concerns that the HE reforms
(see Chapter 6) may erode STEM provision in favour of cheaper
subjects. The SIVS policy is an important tool to help counteract
that. The new approach to SIVS proposed by HEFCE is to be welcomed
in that it will allow other subjects, such as computer science,
to be offered support if they are deemed vulnerable.
98. We recommend that the proposed body in
charge of collecting and analysing data (see the recommendation
in paragraph 73 above) should, by providing evidence and
analysis to HEFCE and the Government, contribute to the process
of establishing which subjects should be given SIVS status.
99. While HEFCE has a legitimate role in determining
which subjects are vulnerable and should be supported as part
of the SIVS programme, we recommend that the Government should
decide which subjects are strategic and should, therefore, be
given SIVS status. The Government's decision could be included
in the Secretary of State's annual letter to HEFCE.
Demand and supply in postgraduate
100. From 2002-03 to 2009-10, there was a 72%
increase in the number of STEM Masters qualifiers, both research
and taught, against a 70% increase in all subjects. However, more
than half of the STEM Masters students who graduated in 2010 were
from overseas. UK domiciled students accounted for only 30% of
this growth (see Tables 3 and 4 in Appendix 6). Over
the same period, the number of STEM PhD graduates increased by
28% against a 26% increase in all subjects, and 42% of PhD students
who finished their doctoral degrees in 2010 were from overseas
(see Tables 5 and 6 in Appendix 6). UK domiciled students
accounted for 15% of this growth. As we have already said (in
paragraph 22), these figures mask the drop or lack of growth
in some of the more traditional STEM subjects at postgraduate
level in UK domiciled students, including chemistry and maths
in Masters qualifiers and engineering and chemistry in PhD qualifiers.
101. We should be concerned that we are not attracting
more home students to study STEM postgraduate courses in certain
STEM subjects. In particular, this relative lack of UK domiciled
students could have a substantial impact on sectors that, for
security reasons, only employ UK nationals such as defence and
the security services.
102. A number of reports have concluded that
the knowledge and capabilities of postgraduates are highly prized
by business and their skills are critical for tackling major business
challenges and driving innovation and growth.
Taught Masters courses provide students with the skills they need
to specialise and work in a range of careers.
Masters postgraduate provision was described by Professor Sir Adrian
Smith as playing "an important role in upskilling and re-training
the UK workforce".
103. The first ever analysis of employment destinations
and the impact of doctoral graduates three years after graduation
using data from HESA showed that, of the 2004-05 cohort, 19% were
working in HE research roles three and half years after graduation
and 22% were employed in HE teaching and lecturing roles. The
other 50% were employed in other research positions, doctoral
occupations and other roles. As RCUK noted, this means that "only
between one quarter and one third of UK doctoral graduates progress
to research or teaching and lecturing roles in universities".
With regard to earnings, "90% of postgraduates working full
time earned between £23,000 and £71,000 with a median
salary of £34,000, around £10,000 higher than first
degree graduates at the same point in their careers". The
study concluded that "doctoral graduates are highly employable
and most are employed in 'doctoral occupations' that are different
from the majority of first degree and Masters degree occupations".
104. Recent reports and submissions to this inquiry
have also highlighted that we know very little about what roles
postgraduate provision is playing outside of research, concluding
that it has been neglected as an issue by Government throughout
the Independent Review of Higher Education Funding and Student
Finance (Browne Review) and HE reforms.
Professor Sir Adrian Smith noted, for example, that
"the value that postgraduate education brings to the UK is
under-researched and under-appreciated".
As a result, he recommended that Government and others should
do more to identify and promote the potential benefits of postgraduate
105. A CIHE report entitled Talent fishing:
what business what from postgraduates found that "there
is a high demand for, and strong satisfaction with higher degrees
[postgraduates], but that there are still areas where HEIs and
businesses must work together to ensure postgraduates have the
skills and knowledge that employers need".
The study showed that around 70% of employers sought out Masters
graduates because they valued the analytical thinking and problem-solving
skills that a Masters degree provides. Of those that recruited
PhD students, they valued the "subject-specific skills and
research and technical skills" as well as the new ideas and
innovation that they brought to their business.
The CBI found, however, that "some STEM employers have ...
reported difficulty recruiting postgraduate STEM skillsalmost
a third (28%) of science, hi-tech and IT employers report current
difficulties recruiting STEM postgraduates".
106. It is clear that STEM postgraduates are
valued and in demand amongst employers, and that they play a significant
role in driving innovation, undertaking research and development,
and providing leadership and entrepreneurship. The University
of Central Lancashire and others told us that the Government should
be making the case for postgraduate study and that they would
welcome a more strategic focus on the contributions that postgraduate
students make to the economy.
It appears to us that, although the Government recognise the central
role that STEM plays in their strategy for growth, they fail to
articulate how they intend to highlight to students the benefits
of postgraduate study, to reduce the decline in STEM qualifiers
in some STEM subjects, or to improve our understanding about the
demand for postgraduates and the value they offer to the economy.
They also fail to make clear what support they will give to postgraduate
STEM provision in order to realise their vision. This is, in our
view, a mistake.
107. We recommend that the Government set
up an expert group to consider the supply and demand of STEM postgraduate
provision in the UK and to identify weaknesses and areas of skills
shortage. The Government, as the strategic leader, should agree
the terms of reference of this group with a view to formulating
a strategy for STEM postgraduate education in the UK which will
underpin their strategies for growth. As part of the expert group,
we urge employers to spell out their needs to Government and to
identify skills shortages at STEM postgraduate level.
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