Australia may need more policy focus on ensuring there are enough skilled jobs for the rising number of graduates given evidence the employment and wage benefits of a degree are less pronounced in Australia than in many other developed countries.
A report by the Australian Council for Educational Research has found that Australia is on track to meet government targets for a significant expansion of degree holders and has attainment levels above the Organisation for Economic Cooperation and Development average.
But it warned the employment rate for graduates is no better than the OECD average at just over 83 per cent. Similarly ACER found that while on average graduates in OECD countries earned 50 per cent more than those with just a school qualification, in Australia the earning premium was 45 per cent.
“Australia may be correct in increasing its attainment rates, it will need to develop a better nexus between attainment and employment rates to ensure that its investment in graduates generates appropriate returns for the development of its labour force and that there is value seen by potential students in obtaining this level of qualification,” ACER said.
Researcher Daniel Edwards said the policy to boost attainment was based on expectations that the economy is changing and will require higher skills. But he said the government needed also to look at policies to encourage such an economy to develop. He said that as the numbers of graduates rise the government should closely monitor their employment outcomes.
“I’m actually optimistic, but we do need to keep an eye on it,” Dr Edwards said. “I think there is a role for government to play here,” he said.
However earlier this month the Australian Workforce and Productivity Agency warned that demand for skills and qualifications will grow strongly in the lead up to 2025. It said increased investment in tertiary education was needed to avoid an undersupply of qualifications by then. Based on its projection Australia is facing a potential undersupply of 45,000-280,000 qualifications at the diploma level and above by 2025.
The Commonwealth is expanding the supply of university places as part of an effort to boost the proportion of 24-35 years olds with a bachelor’s degree or higher to 40 per cent by 2025, compared with 35 per cent now.
Reinvent Your Career would like to thank The Australian where this article first appeared.