Overqualified and underemployed: meet Australia's graduates

More Australians are attaining tertiary degrees than ever before, yet many end up working in menial jobs with little or no relevance to their chosen field. Are they just wasting time and money?

Twenty-six-year-old Bradley Woolstencroft is looking for work. He has a job, but that’s not the problem. Woolstencroft is employed as supervisor at Woolworths, when he’s qualified for the courtroom.

It’s a frustrating situation for Woolstencroft, who spent the better part of the past six years studying for his legal debut. He keeps applying and attending interviews, but is yet to land a position.

“I’ve had interviews with some pretty big law firms as well as companies such as Woolworths and Fujitsu, but haven’t been successful in finding work,” he says.

“At almost every job interview I’m told I’m a good candidate, but not what they’re looking for… I didn’t think it was going to be this difficult to get a job.”

Woolstencroft's situation is not unique. More and more of Australians are becoming overqualified and underemployed. A 2013 report by the Foundation for Young Australians, 26 per cent of Australian higher education graduates are underutilised immediately after completing their courses.

Further statistics by Graduate Careers Australia found that out of 484 employers surveyed, 19.3 per cent did not recruit any graduates as part of their 2013 intake, an increase of 6.8 per cent from the previous year.

Many students often end up working menial jobs with little or no relevance to their chosen field. But why is this the case?

One school of thought is that there are simply too many students studying at university.

When the former Labor government switched to a ‘demand-driven system’, the number of student places increased considerably. Prior to this, the government was able to place a cap on the number of enrolments that universities could give to students. Entry level requirements were higher, allowing for a greater level of quality control. 

Under the new system, universities can adjust enrolments based on demand for courses excluding medicine. The policy was officially introduced in 2012. Yet increases in enrolments had already begun by 2009 following a government review into higher education.

The changes saw student places rise from 469,000 in 2009 to an estimated 577,000 in 2013.

The Australian government recently conducted a review into the ‘demand driven system’. Dubbed the ‘Kemp Norton’ review, the inquiry moved to keep the system and made a number of recommendations, and extended its reach to diplomas and TAFEs.

And although the fact that more people are undertaking higher education can be seen as a positive, recent survey data shows that employment rates for a number of industries are declining.

Jenny Lambert is the director of education, employment and training at the Australian Chamber of Commerce and Industry. She says the increase in university graduates is concerning.

“We did a submission to the Kemp Norton review and our biggest concern was skills utilisation and whether the labour market will soak up the larger amount of students coming out of university,” Ms Lambert says.  

She argues the government is acting with too much haste.

“We wanted the government to wait a year or two until those affected had graduated. This would’ve determined whether the outcome required a change in policy,” she says.

Law is just one of the industries experiencing oversupply. The amount of new graduates has more than doubled in the last decade. In 2001, over 6,000 graduates had completed some form of under-graduate or post-graduate qualification. Today, the figure is just over 12,000.

As a result, employment rates have fallen by over 10 per cent in the last decade, with 30 per cent of graduates surveyed in 2012 not working in the legal field.

Ms Lambert believes that students should be cautious in choosing what they study.

“While it is true that students should study what they’re interested in, they also need to go where the jobs are,” she says.

But the job market and state of the economy may also play a role.

Over one-third of 484 employers surveyed by Graduate Careers Australia indicated that ‘economic conditions’ affected the total amount of graduates hired. The second reason was ‘budgetary conditions’.

Bruce Guthrie, director of Graduate Careers Australia, says underemployment is symptomatic of a weak economy.

“A lot of graduates are underemployed because there are no other options,” he says.

Guthrie, however, thinks the problem is temporary, noting that supply should always exceed demand.

“People still need to study and it may be there is a sudden turnaround in the economy and you don’t want to have a notably reduced amount of people studying.”

But economic reasoning is cold comfort for Bradley, who is still stuck stacking shelves at Woolworths.

“There are not enough programs for graduates of business and law like there are for medicine, education and nursing where the placements are already provided,” he says.

“If I had my time again, I would have never have gone to university.”

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