Reporting Year 2020

Graduate labour market statistics

This is the latest data

Published: 10 June 2021
Next update: May 2022
Last updated: 23 September 2021
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23 September 2021
In the original GLMS release published in May 2021 the charts depicting median salaries for the working and young populations over time contained a small error. This has now been corrected and the accompanying text has been updated to reflect these changes.
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These statistics show labour market conditions for the following groups living in England:

Graduates
Postgraduates
Non-graduates

This release also sets out a breakdown of graduate outcomes by different subcategories, such as gender.

Headline facts and figures - 2020

Summary

Graduates and postgraduates continue to have higher employment rates than non-graduates. However, employment rates for working-age graduates, postgraduates and non-graduates alike were slightly lower in 2020 compared to 2019.

In 2020, the employment rate for working-age graduates – those aged 16 to 64 – was 86.4%, down 1.1 percentage points from 2019 (87.5%). For working-age postgraduates the employment rate was 88.2%, for non-graduates it was 71.3%; these data represent falls of 0.5 and 0.7 percentage points from 2019, respectively.

66% of working-age graduates were in high-skilled employment, compared with 78.4% of postgraduates and 24.5% of non-graduates. The graduate rate increased 0.4 percentage points in 2019. The rate for non-graduates was 0.6 percentage points lower than in 2019 while for postgraduates it was 0.5 percentage points down on the previous year.

The median salary for working-age graduates was £35,000 in 2020. This was £9,500 more than non-graduates (£25,500) but £7,000 less than postgraduates (£42,000).

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Key Statistics

For graduates, employment rates fell for the second consecutive year to 86.4%, from 87.5% in 2019. This follows a period of modest but sustained increases between 2009 and 2018, when the rate peaked at 87.7%.

The postgraduate employment rate fell by 0.5 percentage points in 2020, which was smaller than the 1.1 percentage point reduction for graduates. Having been the same in 2018, a 1.8 percentage point gap between the postgraduate and graduate rates – 88.2% and 86.4%, respectively – opened up in 2020.

For the first time since 2010, the non-graduate employment rate fell year-on-year. It decreased to 71.3%, from 72%.

While employment rates for graduates and postgraduates were broadly similar in 2020 (a 1.8 percentage point differential), there was a greater difference between their respective high skilled employment rates, which was 12.4 percentage points higher for postgraduates than graduates.

Notably, for non-graduates high-skilled employment comprised a much smaller share of overall employment than for the other groups. Only 24.5% of non-graduates were in high-skilled employment; by comparison, 66.0% of graduates and 78.4% of postgraduates were.

Median (nominal) salaries increased for both graduates and non-graduates in 2020 with the graduate premium (represented by the difference between the two salaries), widening slightly to £9,500 in 2020.

Median salaries for postgraduates saw no change, on average, compared with 2019, reducing slightly the postgraduate premium over graduates and non-graduates.

Comparisons over time and other interpretations of these data should be made with caution. The median salary figures in this publication are not adjusted for inflation and are rounded to the nearest £500.

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Introduction

The Graduate Labour Market Statistics (GLMS) in this publication cover labour market conditions for English domiciled graduates and postgraduates and compare these to English domiciled non-graduates. This edition of the GLMS summarises the annual employment and earning outcomes data for graduates, postgraduates and non-graduates in 2020. All earnings data in this publication are calculated for full-time workers only. In addition to the median outcomes data, this publication also provides the employment and earnings outcomes of graduates by various characteristics. The breakdowns included are: age group, gender, ethnicity, disability status, degree class and sector of employment. Further breakdowns, covering region, subject and occupation are also contained in the underlying data files.

For the first time, in this latest GLMS release, we present additional analysis on part-time workers' employment outcomes. These outcomes are broken down for the working-age (16 - 64 year olds) and young (21 - 30 year olds) population groups throughout; in the age breakdown section, further granularity is explored. This publication also provides time series data covering the period from 2007 to 2020, which enables us to identify and understand key trends in the headline statistics over time. As the results presented in the publication are based on quarterly survey data, they represent estimates. Any findings should be interpreted with caution as they may not necessarily be statistically significant.

In this publication, graduates refer to people whose highest qualification is an undergraduate degree at Bachelor’s level; postgraduates are those holding a higher degree (such as a Master’s or PhD) as their highest qualification; and non-graduates are those whose highest qualification is below undergraduate level, i.e. National Qualification Framework Level 5 or below (see methodology note for a more detailed explanation).

The GLMS only provides simple outcome measures based on survey data and does not control for the differences in characteristics between graduates, postgraduates and non-graduates. This means that the outcomes reported may not be wholly attributable to the fact that an individual holds a particular qualification, but instead could reflect other factors, such as their skills, experience, or geographic location.

Further information on the methodology used and validity of the estimates can be found in the methodology section and supporting data. Because annual summaries are based on populations which are themselves derived from the summation of quarterly data sets, it is not possible to produce confidence intervals for this analysis.

Since the last GLMS release in May 2019, the UK macroeconomy has experienced a significant shock due to the Coronavirus pandemic which has severely disrupted business activity in many sectors of the UK economy. There is significant uncertainty around how long it will take for the UK economy to return to a state of normalcy, as the economic and societal impacts of the Coronavirus pandemic begin to dissipate. As such, it is too early to make judgements as to whether any of the observed changes in trend are likely to be temporary or permanent.

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Headline Outcomes

Graduates and postgraduates had broadly similar employment, unemployment and inactivity rates in 2020. Comparatively, postgraduates had a higher employment rate, a lower inactivity rate and a lower unemployment rate.

Employment outcomes for non-graduates were considerably different, with stark differences visible across all three metrics. In the case of inactivity rates, the non-graduate rate was more than double that of both other groups. Nearly one in four non-graduates was economically inactive.

Patterns in the employment rates for the young population mostly mirror those seen in the working-age population. For graduates and post-graduates, the difference between the young and working-age populations is negligible, for non-graduates it is 3.5 percentage points higher for the younger age group.

Inactivity rates are lower for all groups in the young population compared to the working-age population. Conversely, the unemployment rate is higher for all groups in the young population. This indicates a higher level of involuntary exclusion from the workforce.

All graduate types’ high-skilled employment rate was higher in the working-age cohort than in the young cohort. This conforms to the notion that skills accrue to workers throughout their careers, helping them to progress into more technical jobs as they get older.

The biggest absolute difference between high-skilled employment rates across both age cohorts was for graduates – 7.9 percentage points. The postgraduate difference is small by comparison – 2.9 percentage points.

Within both the working-age and young population cohorts, postgraduates had the highest (nominal) median salaries, graduates had the second highest, and non-graduates had the lowest.

Median salaries diverged across the two age groups. On average, people see earnings growth later in their working lives, regardless of qualifications. This disparity was most significant in the postgraduate group (£11,000). The gaps for the graduate and non-graduate groups were £7,000 and £4,000, respectively.

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Year-on-year Changes

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Time Series Data (2007-2020)

Between 2007 and 2020, employment rates have fluctuated slightly more for the young population compared to working-age population. This might suggest that the employment of young people is disproportionately influenced by changing structural conditions in the economy or alternatively that young people are more responsive with their labour supply.

Whilst employment rates for both graduate and postgraduates in the working population fell between 2019 and 2020, within the young population only graduates saw falling employment rates. The postgraduate employment rate remained at 88.3% for a second consecutive year; the non-graduate employment rate rose to its highest level since before 2007 – 74.8%.

Similar to the trend in employment rates, high-skilled employment rates fluctuated more for the young population than for the working-age population. Overall, however, high-skilled employment rates have varied less since 2007 than employment rates. This suggests that high-skilled jobs are more secure and less susceptible to economic shocks.

Non-graduates were the only group whose high-skilled employment rate was above 2007 levels in 2020; this was true for both age group cohorts.

Between 2019 and 2020 unemployment rates increased for all qualification categories in the working-age population. Within the young population, unemployment rates rose for graduates and non-graduates, but fell slightly for postgraduates (by 0.1 percentage points to 3.9%).

For both age groups, the graduate unemployment rate rose most in the year to 2020 – by 1.8 percentage points for the young population, and by 1.1 percentage points for the working-age population. This narrowed the gap between non-graduate and graduate unemployment rates to 1.6 and 0.8 percentage points, in the working-age and young populations, respectively. These are the smallest differences for either cohort since 2007.

Since 2007, the postgraduate unemployment rate has remained persistently below that of the graduate group within the working-age population. Meanwhile, for the young population, the postgraduate unemployment rate has been below that of the graduate unemployment every year except 2010 and 2017. In 2020, the gap between the two rates was 2.4 percentage points.

Median (nominal) salaries were higher in the working-age population than the young population for graduates, postgraduates and non-graduates in 2020. The gap was largest for postgraduates and smallest for non-graduates. This might be reflective of postgraduates taking longer to obtain higher wages after leaving study, or might be attributable to postgraduates entering the labour force when they are older, thus having less time to increase their wages before the age of 30. Wage differentials could also be a product of heterogeneity between the types of people who undertake different levels of study, rather than due to the qualification itself.

Salaries have increased over time for all subgroups. The relative differences between groups have not changed significantly over time.

*Comparisons over time and other interpretations of these data should be made with caution. The median salary figures in this publication are not adjusted for inflation and are rounded to the nearest £500.

Median (nominal) salaries were higher for working-age males than females in each qualification breakdown. At £8,500, the salary gap was largest for graduates. This was down from a high of £10,000 in 2019, however. The gap was £7,000 for postgraduates and £6,000 for non-graduates.

Since median salaries are calculated for individuals employed in full-time work only, the higher proportion of females in part-time work does not contribute to the gender pay gaps in these figures.

Using median salaries mitigates against average values being skewed by extremes. It does, however, conceal other features of the data, for example, that the difference in pay between the sexes is largest among high earners[1].

[1] Office for National Statistics – Gender pay gap in the UK: 2020

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Median Salaries by Industry

Males employed in banking and finance had the highest median working-age salaries (£45,000), whilst for the young population, males in manufacturing had the highest median salaries (£35,000).

From the female group, those employed in transport and communication had the highest median salaries in both the working-age (£35,500) and young (£28,000) populations. Females who were employed in distribution, hotels or restaurants had the lowest median salaries – £24,000 and £26,500 for the young and working-age populations, respectively. Despite being the lowest earning group for all females, young females employed in distribution, hotels or restaurants earned more than young males employed in the same industries (£22,000).

Across all industries, males had higher median working-age salaries than females. This was also true for the young population in each industry apart from distribution, hotels or restaurants.

Importantly, some data from the young population have been suppressed. Conclusions about this group are based on available data. Comparisons with young people working in construction or young females working in manufacturing are not possible. These data might impact some of the key findings.

Further analysis of the gender pay gap in 2020 can be found in the Office for National Statistics’ publication: The gender pay gap in the UK: 2020.

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Disability, Ethnicity and Degree Class Breakdowns

Disabled graduates had lower employment (73.4%) and high-skilled employment (52%) rates than non-disabled graduates (88.4% and 68.1%, respectively). The inactivity rate for disabled graduates (22.4%) was more than double the rate for non-disabled graduates (8.4%).

White graduates had the highest employment rate (86.8%) and high-skilled employment rate (67.0%). The group with the lowest employment and high-skilled employment rate was Black, African, Caribbean or Black British graduates – 81.2% and 53.2%, respectively.

Inactivity rates exhibited the least variation between the ethnic groups – only 1.8 percentage points. Asian or Asian British graduates had the lowest inactivity rate (9.9%). Graduates in other ethnic groups had the highest inactivity rate (11.7%).

Black, African, Caribbean or Black British graduates had the highest unemployment rate (8.6%), more than twice the rate of white graduates, who had the lowest rate of groups for whom we have data (3.4%).

In 2020, graduates with upper second class degrees had slightly higher employment rates, high-skilled employment rates, and lower inactivity rates than their counterparts with first class degrees. This stands out against an otherwise ordinal pattern of higher degree classes being associated with improved employment and high-skilled employment rates.

The range of unemployment rates was very small – only 0.1 percentage points across the groups for which we have large enough samples.

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Part-time workers

Female workers were more likely to work part-time than males in 2020. The highest proportion was in the female non-graduate group, where 43.2% of workers were working part-time. In both qualification breakdowns, female workers were over three times more likely to be working part-time than male workers.

Across all four graduate and gender breakdowns, a smaller proportion of workers worked part-time in 2020 than in 2019. The largest fall was 1.9 percentage points for female non-graduates (from 31.7% to 29.8%).

Only the female non-graduate worker group had a lower proportion of part-time workers in 2020 than in 2007.

Across all four age groups, non-graduates had a higher proportion of part-time workers than graduates.

For graduates and to a lesser extent graduates, there is a clear trend showing that older age cohorts had a higher proportion of part-time workers than younger ones.

The proportion of working-age non-graduates working in part-time employment is consistently higher than for their peers in the younger population. For both groups, the proportion in part-time work steadily increased after 2007 reaching a peak in 2012 and 2013, for working age and young population non-graduates, respectively. In percentage point terms, the proportion of young population non-graduates in part-time work has fluctuated to a great extent than working-age non-graduates.

As was seen with non-graduates, graduates experienced increases in the proportions of part-time workers after 2008. This rise coincided with a slight uptick in unemployment for graduates between 2008 and 2009.

There was some similarity in trends across age groups, though there was greater fluctuation for young non-graduates compared to their working-age counterparts. Neither group experienced a major declining trend after 2013, in the way as young non-graduates; both rates have stayed within 1.2 percentage points of the 2013 rate each year to 2020.

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Further information

Within the supporting data we have provided a more detailed focus on the employment and earnings outcomes of graduates by their specific characteristics. These breakdowns include:

o Age group

o Gender

o Ethnicity

o Disability status

o Degree class

o Subject group

o Occupation

o Sector

o Region

o Part-time work

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