By Sandra Davie, The Straits Times, 13 May 2013
LAST year when the Government announced a generous expansion of university places, it assured Singaporeans that this will not undermine the value of a degree or lead to a glut of graduates.
The Ministry of Education (MOE) said the increase will be through more places and courses at the Singapore Institute of Technology and SIM University, giving 40 per cent of Singaporeans a shot at a local university education. It will also support the part-time degree route, enabling another 10 per cent of Singaporeans to get a degree.
Parents and students cheered the move, and the promise of better wages.
Figures released by the US-based Pew Research Centre showed that in the United States, those with a degree earn, on average, in excess of US$1 million (S$1.23 million) more over their lifespan than those without one.
A 2007 Ministry of Manpower (MOM) study also showed that every extra year of schooling increases a worker's earnings by 13.7 per cent. The rate is higher for tertiary education.
But some in Singapore were concerned about increasing the number of graduates here, asking if the economy can support so many of them.
Recruitment experts also pointed out that in 1990, only 15 per cent of students in the same age group went to university.
But Mr Lawrence Wong, then Senior Minister of State for Education who led a review of the university sector, pointed out that the Singapore economy is already able to support a fairly large number of degree holders.
Quoting MOM figures, he said close to half of Singapore residents aged 25 to 29 hold degrees. And 44 per cent of those in this age group earn at least $3,000 a month, which indicates how many graduate-level jobs were available.
He also noted that the demand for graduates is rising as Singapore needs a highly-skilled workforce to drive its future economy.
Professional, managerial and executive type jobs are the fastest-growing segments of the workforce, going from 27 per cent in 2001 to 32 per cent last year.
"Going forward, clearly we can accommodate more university graduates," he said at a press conference last August announcing details of the plan to increase the number of university places.
But what happens in a recession? When the Singapore economy slowed four years ago, diploma holders fared better than graduates. MOM figures for the third quarter of 2009 showed that among those unemployed, about 6 per cent were diploma holders while 22 per cent were degree holders. It was the same with redundancies, with fewer polytechnic graduates laid off than their university peers.
Recruiters explained that diploma holders cost less and possess more practical skills that employers value, especially in a downturn. When retrenched, poly graduates were also more willing to take lower-paying jobs.
But in the subsequent upswing, the university graduates did better. Job prospects and salaries of degree holders recovered and even overtook those of diploma holders.
A 2010 MOM labour force report showed that unemployment was 3.7 per cent for degree holders compared to 3.9 per cent for those with diplomas.
Still, some labour economists warn that what happened in the past may not accurately reflect what may happen in the future.
The opening up of university places may lead to a glut of graduates, especially during times when the job market is unable to absorb them all.
Degree hopefuls should also note that not all degrees are created equal. Returns on degrees in accountancy and law, as well as the sciences and engineering, are higher compared to those in social work, psychology and English.
Employers, including the civil service, also make a distinction between graduates from the publicly-funded universities and those who attain their degrees through the private schools such as the Management Development Institute of Singapore and Singapore Institute of Management. Employment surveys carried out by the more established private schools show that while its graduates land jobs, they are each paid several hundred dollars less than graduates from the publicly-funded universities such as the National University of Singapore and Nanyang Technological University.
This means quality is as important as quantity. As the number of graduates goes up, universities should pay equal attention to innovation and cultivating in students an X factor.
Take, for example, the Singapore Management University (SMU), which models itself after American colleges. After its first batch of students graduated in 2004, employers noted the "SMU difference", and found its graduates were confident, mature and had good communication skills.
Turning out graduates who are adaptable, with premium skills relevant to industry, is a must, to ensure a university degree continues to pay off for Singaporeans.
United States: Degree holders hired but not always for grad-level jobs
By Sandra Davie, The Straits Times, 13 May 2013
US COLLEGE graduates are finding jobs, but these may not be the right jobs.
According to official figures released last month, the unemployment rate was 3.9 per cent for graduates, compared with 7.5 per cent for the entire workforce.
Even when the jobless rate for graduates was at its highest back in November 2010, it was still just 5.1 per cent. That is close to the jobless rate the rest of the workforce experiences in a good economy. But the jobs that college graduates have may not be at graduate level.
About 48 per cent of employed college graduates are in jobs that the Bureau of Labour Statistics suggests need less than a four-year degree education - 11 per cent are in jobs requiring more than a high school diploma but less than a bachelor's, and 37 per cent are in jobs requiring no more than a high school diploma.
The proportion of over-educated workers appears to have grown substantially. In 1970, less than 1 per cent of taxi drivers and 2 per cent of firefighters had college degrees. Now, more than 15 per cent in both jobs hold a degree.
Some bosses are requiring four-year degrees for jobs that previously did not need them since companies realise that, in a relatively poor job market, college graduates will take whatever they can find.
Still, a degree is worth obtaining. An analysis from the Hamilton Project at the Brookings Institution estimated that a four-year degree was equivalent to an investment that returns 15.2 per cent a year.
"This is more than double the average return to stock market investments since 1950," the report said, "and more than five times the returns to corporate bonds, gold, long-term government bonds, or home ownership."
Britain: Graduate job market steady, more starting own businesses
By Sandra Davie, The Straits Times, 13 May 2013
DESPITE a rising number of degree holders and a struggling economy, the graduate job market has remained relatively resilient in Britain.
UK Higher Education Careers Service Unit figures released last October showed that 62 per cent of graduates get jobs six months after university. Just 9 per cent remain unemployed.
Another 14 per cent continue on to further studies, and the remainder are involved in other activities, such as training while working.
The weak economy also seems to have pushed more students into starting their own businesses. The proportion of graduates who are self-employed is steadily increasing. It is now 5 per cent, up from 3 per cent in the middle of the last decade.
In terms of salaries, the range was between £18,000 (S$34,400) and £24,000 for graduates who had jobs six months after leaving university.
But as in the United States, there is under-employment.
More than a third of young British graduates are in jobs that do not require degrees, statistics show. This figure has soared in the last decade, rising by a third since 2001.
The Office for National Statistics (ONS) found that the proportion of university leavers in non-graduate jobs had increased from 26.7 per cent in 2001 to 35.9 per cent in 2011. The ONS analysed the jobs that graduates were holding two years after leaving university.
Still, graduates typically have higher employment rates than those without higher education, it said.
Studies in Britain also show that in the long term, graduates are likely to earn higher incomes than non-graduates and are less likely to face unemployment.
THE SINGAPORE PERSPECTIVE
PMETs most vulnerable as restructuring intensifies
By Sandra Davie, The Straits Times, 13 May 2013
THE latest Ministry of Manpower (MOM) report released last month should give Singaporeans some food for thought.
The report said more workers are being laid off as Singapore's effort to restructure the economy intensifies.
Last year, 11,010 workers lost their jobs, a 10 per cent increase from 9,990 workers the year before.
But what degree hopefuls should note is that a disproportionately high number of those asked to go are professionals, managers, executives and technicians (PMETs).
Last year, 5,960 PMETs were laid off, or 7.4 out of every 1,000.
This is the first time in a decade that PMETs formed the most vulnerable group.
MOM said this might reflect "the growing vulnerability of mid-level white-collar workers due to globalisation and technological innovations".
Some PMETs with savings may also prefer to take a longer time to find jobs that match their skills, qualifications and salary expectations, MOM said.
Residents laid off from PMET positions were mostly in their 30s and 40s, and a majority of 69 per cent were displaced from services jobs.
Experts also pointed to the struggling banking sector.
More than one-fifth of the PMET lay-offs were in the financial services.
However, recruitment experts say bank lay-offs are unlikely to rise further this year.
Labour economists also noted the job trends from the previous year which show that educated workers are able to ride business cycles better than unskilled workers.
This is the seventh of 12 primers on various current affairs issues, which will be published in the run-up to The Straits Times-Ministry of Education National Current Affairs Quiz.