UK universities still don’t produce enough graduates with the skills that businesses really need. Should employers themselves shoulder some of the blame

There’s a hackneyed megaphone exchange going on,” says Rob Cuthbert, vice-chancellor of the University of the West of England (UWE). He’s not the only one to sound a weary note about the perpetual squabbles between the UK’s employers and higher education institutions about the state of graduate skills.

These arguments have being going on for a long time. In 1776, Adam Smith, the father of modern economics, grumbled in The Wealth of Nations: “The greater part of what is taught in schools and universities… does not seem to be the proper preparation for business.”

Recent developments have heightened the debate. First, the 2006 Leitch review warned that unskilled jobs would soon disappear from the UK. Then a survey by the Association of Graduate Recruiters (AGR) at the start of this year found that, despite graduate numbers more than doubling over the past decade, 55 per cent of graduate employers were anticipating problems in finding enough appropriately skilled recruits. (A further AGR survey in July revised this down to about a third.)

 Universities are being pressed to meet Leitch’s targets of 40 per cent of adults attaining level 4 skills (degree or certain other professional qualifications) by 2020, while their graduates compete with students from China, Russia and the US for the best jobs.

The Leitch review has been criticised by City analysts for neglecting the highest level skills. Research by the Financial Services Skills Council (FSSC) from 2006 and 2007 also revealed growing concern about “a mismatch between levels of skills in the graduate market and the real needs of employers”, as well as an “acute shortage” of higher level numeracy skills, alongside language and cultural awareness, risk management and softer skills.

 

Faye Chua, the council’s head of research, argues that the problem stems from the fact that UK students don’t need maths credits to complete their degrees, as they do in the US and elsewhere. “When they graduate, they won’t even have basic calculus,” she says. “There is a widening gap between the numeracy and quantitative skills of UK students and their overseas counterparts.”

The FSSC’s report noted that universities were sometimes “opaque, unresponsive and uncoordinated in their dealings with business”, with too few sector-wide links. The council has called for more collaboration between industry and academia, plus an enhanced role for careers services as “skills brokers”.
 
According to Semta, the science, engineering and manufacturing technology sector skills council, growing competition for a diminishing supply of engineering, maths and science graduates is marginalising manufacturing and engineering employers in the war for talent.

 t’s estimated that up to 15 per cent of firms in these sectors are struggling to find the skills they need, particularly in mechanical engineering (43 per cent with graduate shortages), electronics (27 per cent) and electrical engineering (22 per cent). In addition, over half say that their skill needs have altered in the past three years, while 48 per cent expect further changes. It’s not surprising that universities are struggling to keep up.

Graduates with degrees in subjects such as pure chemistry and physiology are most in demand here, says David Winstanley, Semta’s science adviser. But these, he adds, are “unfashionable” courses compared with those in “trendy” applied sciences, such as forensics or modular degrees, that allow students to avoid difficult practical work.
 
“Unfortunately there are only about two jobs at Scotland Yard doing fingerprinting,” Winstanley says. “Yet universities turn out hundreds of people who want to wear flak jackets and carry a gun. They think the world is like TV.”
He blames not only universities, which often enter the picture too late to make a difference, but also schools and the lack of resources to help students develop the practical skills essential for clinical and experimental work later on.
 

Graduates themselves are becoming more aware of the need to develop these skills. A third of graduates responding to the CIPD survey last year said they would choose a different course if they had their time again. Of these, around a quarter (23 per cent) of 2005 graduates, and 16 per cent of 2000 graduates, would opt for a more scientific or technical course. But it’s not only technical skills that are in short supply.
 

According to the FSSC, other critical attributes lacking among graduates include literacy, cultural awareness, communication and commercial acumen. Tracey Hahn, managing director of leadership and talent management, EMEA, at Merrill Lynch, says it’s overseas graduates who really understand how to use that last skill in context. She is also concerned about the lack of work experience among many UK graduates.

 As a result, the investment bank – which demands that all graduate recruits have a second language – is increasingly recruiting from China, France, India, Poland and Russia.

Hahn is especially impressed with the quality of recruits from India. “IIT and IIM (the Indian institutes of technology and management respectively) are so selective and work them really hard, so we are dipping into a pool of cream,” she says.

Stephen Isherwood, head of graduate recruitment at Ernst & Young, says graduates from continental Europe can “hit the ground running”. The accountancy firm has started to recruit second-jobbers in the UK, because they have “caught up with their European counterparts”, who have work experience in their degrees. “I wonder whether employers and universities have really grasped that nettle,” Isherwood says.
 
Despite all the criticisms, innovative projects such as Teach First (see panel, facing page) are developing graduates’ skills, while the HE sector is taking big strides to meet employers’ demands. Rob Cuthbert at the UWE argues that businesses “have a shorter-term view and are often quite volatile” in their expectations, and need to be clearer about what they mean by specific skills.

The university has conducted research into the needs of employers, identifying a top 10 skills list (see panel, right) that divides each skill into four “themes” and asks employers to indicate what level of skill they expect on day one and at six months and a year into a graduate’s career. This month the UWE is starting a programme to identify students’ capabilities and development needs against these “employability” skills.

While Cuthbert believes that employers who recruit from a select list of institutions as a way of filtering talent are “lazy”, most City firms still insist on 2:1 degrees from the Russell Group of elite universities, says Darius Norell, founder of graduate magazine Real World. He claims employers are partly responsible for creating the situation they’re complaining about by setting a benchmark that forces students to focus on academic attainment.

Pointing out that standards vary even between departments in the same university, Norell argues that a 2:1 is no reliable indicator of future job performance – employers who use this benchmark are displaying “intellectual snobbery”, he says. Both Cuthbert and Norell are also concerned about the impact of socially selective recruitment on diversity in the workplace.

In response to such concerns, firms such as Orange (see panel, page 26) have begun to change their graduate recruitment processes. But others, such as Ernst & Young, still insist that a candidate with good A-level and degree results will be more able to attain the professional qualifications it demands.

The University of Hertfordshire has taken a different approach. Founded specifically to supply skills to the De Havilland aircraft company, it calls itself a “business-facing university”. It owns a 98 per cent stake in Exemplas, the company that runs Business Links for the east of England, giving it access to more than 50,000 firms. 

“Each course is designed with a professional advisory group to bring industry input into curriculum design,” explains Alix Green, policy adviser to the university’s executive.
Employers such as Rolls-Royce have long recognised that links with universities are crucial to developing the skills they need. With 20 university technology centres, which both conduct research and provide a source of talent, the company’s graduate employees are also encouraged to mentor pupils in schools to stimulate their interest in the sciences.

Ged Leahy, director of strategic workforce and skills planning at Rolls-Royce, believes employers should take responsibility for developing the “food chain” of skills from school onwards.

“I think it’s a bit of a cop-out from industry to expect graduates to come with these skills when they have little work experience,” he says. “It should be clear what universities are for, and then we’re geared to adapt people to the way we want them as part of our graduate programme
But there are signs that the two sides in the debate are moving closer. “What I am detecting is that HE institutions are much more willing to engage with industry,” says the FSSC’s chief executive, Teresa Sayers. “It’s about ensuring we’re talking the same language.

Orange plans an upgrade

Orange is changing the way it recruits graduates. Next year the mobile phone service provider will abandon its generic graduate recruitment scheme, which it believes no longer provides the required skills or differentiates the company from its competitors. It will focus instead on targeting specialist disciplines.

Nicola Grant, new talent schemes manager at the company, explains: “We analysed what the business needed, what we recruited against and how they were fitting together. It became apparent that we were really looking for graduates to come in and be specialists; it isn’t a management scheme.”

With financial acumen often hard to find, Orange is focusing on the internet and working with the Association of Chartered Certified Accountants to highlight its graduate finance scheme. It is also lowering its minimum degree requirement from 2:1 to 2:2.
 
“You miss out on a massive talent pool if you restrict it to 2:1,” says Grant, who believes that a successful career at Orange is more about entrepreneurialism, networking, influencing skills and creativity than having the best degree.

 

Graduates bite back
 
A graduate panel discussion recently organised by Orange and the Make Your Mark campaign found that employers were failing to target or identify graduate talent. Panel members also said that:

wThere amismatch between what employers recruited for (numeracy, literacy and practical skills) and what they really wanted (communication, people skills and emotional intelligence).

 Two-thirds of participants felt they didn’t have the chance to demonstrate their real skills during the recruitment process.

 More contact with employers – for example, using Facebook, MySpace and other social networks, as well as internships – was needed to help students understand the skills that employers want.

 Mentoring networks in organisations would help graduates to understand what was required of them.

Make Your Mark is a national campaign, backed by business, charities, education bodies and government, that aims to encourage a culture of enterprise among young people.(www.makeyourmark.org.uk)

 
Graduate recruiters’ top 10 competency requirements

 

1. Motivation
2. Confidence
3. Resilience
4. Initiative
5. Interpersonal skills
6. Emotional intelligence
7. Open-mindedness
8. Problem-solving
9. Teamwork
10. Independent working

 

Source: The University of the West of England

 

The university of hard knocks

 

Launched in 2002, Teach First is a scheme to attract high-flying graduates to a two-year stint teaching in the toughest inner-city schools before they embark on a career in the City of London.

Operating in partnership with organisations such as JP Morgan, Deloitte and Accenture, the scheme recruits 360 graduates a year, most of whom will either have been offered a job by one of the big City firms or will be targeted by them once they have finished their placement. Those with job offers already on the table have their places held open for them.

Participants will help some of the country’s most educationally deprived children and gain a teaching qualification in the process. They will also undergo intensive training in business skills.

Backed by Imperial College London’s Tanaka Business School, the course covers topics such as communication, marketing, finance and leadership.

“We recruit using the same competencies that employers do, and with respect, humility and empathy,” says James Darley, Teach First’s director of graduate recruitment. “We asked employers whether they thought teaching would develop the transferable skills they were lacking. They said: ‘Yes, these are vital.
 

According to Aly Sparks, national recruitment leader at Deloitte, the graduates have been “put in positions of leadership pretty quickly. They get planning and organisation skills, influencing and teamwork skills and the ability to deal with difficult people – students and parents alike. Graduates feel more prepared to step into this kind of environment and it stands them in good stead with Deloitte.”

(www.teachfirst.org.uk)



Graduates in the workplace: does a degree add value


CIPD survey report 2006  

(www.cipd.co.uk/surveys)