Half recent graduates are in non-graduate jobs

Almost half of the UK's recent graduates are working in non-graduate jobs, demonstrating that pain continues to be felt in the labour market despite the start of economic recovery.

The Office for National Statistics said 47 per cent of those who completed a degree in the past five years were working in roles such as sales assistants and care workers in April to June this year, up from 39 per cent in 2008.

The figure has stabilised in the past three years but shows no sign of falling, even though employment across the economy has grown by 1.1m since early 2010.

The data comes after analysis by the Financial Times showed that the most recent class of graduates is earning 12 per cent less than their pre-crash counterparts and owes 60 per cent more student debt.

The ONS found, perhaps unexpectedly, that students who opted for media and information studies had the second highest employment rate of all graduates, 93 per cent, after those with degrees in medicine or dentistry (95 per cent).

However, while the medical graduates had the highest median pay, at £45,600 a year, their media and information studies peers had the lowest of all subject groups, at £21,000.

The next highest employment rates were for nursing and midwifery (93 per cent), technology (92 per cent), agricultural sciences (91 per cent) and architecture (90 per cent).

The rate was lowest for those with humanities degrees, at 84 per cent, followed by arts (85 per cent), languages (87 per cent), education (88 per cent) and social sciences and law (89 per cent).

The proportion of the population classed as graduates has risen steadily from 17 per cent in 1992 to 38 per cent in 2013. Despite the financial pain that recent graduates are feeling, employment rates continue to be higher and unemployment rates lower than for non-graduates.

In April to June 2013 the graduate employment rate was 87 per cent, compared with 83 per cent for those educated to A-level standard, 76 per cent for those educated to GCSE (grade A* to C), 70 per cent for those with other qualifications and 47 per cent for those with no qualifications.

The sharpest rise in unemployment has been among non-graduates aged 21-30, who have a jobless rate of 14 per cent of economically active people in that age group.

For recent graduates, the figure is 9 per cent, "indicating that going on to higher education can help a young person find a job", the ONS said.

Graduates were much less likely than non-graduates to be out of the labour market, with an inactivity rate of only 9 per cent compared with 13 per cent for those with A-levels and 18 per cent for those with A* to C grade GCSEs.

Annual earnings for those with a degree increase at a fast pace as they become older and more experienced, before levelling out about age 38 at a median of £35,000 a year, the ONS said.

In contrast, average earnings for those who left education with an A* to C grade GCSE level out at age 32 at £19,000, and those for with A-levels at age 34 on £22,000.

In 2012, the highest proportion of graduates was in inner London - 60 per cent of the population. The next highest was in outer London (45 per cent), followed by Scotland (41 per cent).

The lowest proportions were in northeast England (29 per cent), followed by the West Midlands (30 per cent).

However, London also had the highest graduate unemployment rates (6 per cent for outer London and 5 per cent for Inner London), possibly connected with the younger average age of graduates there.

John Philpott, director of the Jobs Economist consultancy, said: "The fact that the unemployment rate for recent graduates is much lower than that for non-graduates is due simply to the fact that almost half of those who have recently gained higher education qualifications are entering jobs for which they are over qualified, which makes it even harder for the less qualified to find work.

He added: "Even more worryingly, the unemployment rate for recent graduates has flat-lined since 2010 despite the growth in employment in recent years."

The study found that two in five graduates are employed in public administration, health and education, sectors that are shrinking because of cuts.

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