§ Lord McCarthyasked Her Majesty's Government:
What are the implications of the decline in the graduate labour market since 1989 for their policy on universities and polytechnics.
§ Baroness Denton of WakefieldMy Lords, the Government's policies are designed to promote the long-term expansion and development of the higher education system. Some increase in graduate unemployment in the current recession is inevitable. But that is short term. Economic recovery and technological developments will lead to increasing demand for highly qualified people. Our higher education system must produce more graduates in the interest of future national prosperity.
§ Lord McCarthyMy Lords, I thank the Minister for that reply. But does she deny the collapse in the graduate market over the past two years? Is she aware that the Association of Graduate Recruiters and the Association of Graduate Careers' Advisory Services suggest that there has been a 30 per cent. cut in the number of vacancies, an 80 per cent. increase in graduate unemployment and a 15 per cent. cut in the real value of starting salaries for graduates? Does the Minister agree that we have a generation of graduates now coming out of the university system and there is no demand for their labour? Can she say what the Government intend to do about that?
§ Baroness Denton of WakefieldMy Lords, graduate production is a long-term investment for individuals and for the nation. Turning that production on and off like a tap in response to short-term labour market conditions makes no sense. The Association of Graduate Recruiters which the noble Lord quotes also reported that since July 1991 graduate vacancy advertising has stabilised and it showed a slight improvement by the end of the year.
§ Lord Hailsham of Saint MaryleboneMy Lords, however sincerely one may wish—and I wish as sincerely as anyone else—to see graduates fully employed in suitable work, does my noble friend agree that the real purpose of higher education, whether in the polytechnics or the universities, is to produce a race of fully civilised and educated human beings and that that should not alter with fluctuations in the labour market?
§ Baroness Denton of WakefieldMy Lords, I thank my noble and learned friend. I totally agree with that remark.
§ Baroness BlackstoneMy Lords, is the Minister aware that, as a result of the Government's economic mismanagement and the depth of this recession, there are large numbers of graduates now so desperate about the situation in the job market for people with their level of qualifications that they are taking masters' degrees in order to mark time? Can the Minister say what the Government intend to do to restore full employment for that group? Does she agree that unless that happens, in future when the recession has passed and expansion comes about—which we hope will occur sometime in the future—no one will want to take a degree because they will feel that there will be no work for them?
§ Baroness Denton of WakefieldMy Lords, I am delighted to tell the noble Baroness that graduates have significantly better job prospects than school-leavers who have not participated in higher education. When the upturn comes we shall see, as previous experience has shown, people finding jobs. If at that stage the graduates have second degrees as well, I suggest that that will help the competitiveness of the country.
The Viscount of OxfuirdMy Lords, is my noble friend aware, in a chart shown in the report, Innovation in British Manufacturing Industry, prepared by my noble friend Lord Caldecote, that only 7 per cent. of students in 1990 sought employment in manufacturing industry whereas 33 per cent. sought employment in the media? Does she agree that the case for more selective investigation into what a graduate is going to do eventually is important?
§ Baroness Denton of WakefieldMy Lords, there is direct evidence that the degree chosen has relevance to the opportunity to engage in employment. I am sure that my noble friend will be pleased to know that during this period many employers are re-examining their training schemes and that they will offer better opportunities to graduates.
§ Lord Williams of ElvelMy Lords, is it not always the case that graduates have better job opportunities than non-graduates? As a result of the question asked by the noble and learned Lord, Lord Hailsham, can the Minister say whether the Government wish to see fully civilised and educated people without any employment?
§ Baroness Denton of WakefieldMy Lords, I am sure that we all wish to see everybody in employment. However, this country has lagged behind other competitive nations in the numbers of graduates employed in business. The Government are determined to provide the resources to remedy that situation.
§ Lord MarlesfordMy Lords, may I ask my noble friend to cast her mind back to the question just asked by the noble Baroness, Lady Blackstone? Does she agree that the point made could be turned on its head? The present graduate employment scene could, not as a justification for but as a spin-off from the recession, provide an opportunity for some people to take 1055 further degrees so as to equip themselves better to the benefit of the nation in future, rather than be lured prematurely into quick and easy money.
§ Baroness Denton of WakefieldMy Lords, I thank my noble friend. That of course is totally true. Perhaps one of the interesting activities at the moment is the growth of participation in ERASMUS, which allows the exchange of students in Europe. We now have some 11,000 UK students taking part in that programme compared with only 1,000 in 1987.
§ Lord Campbell of AllowayMy Lords, in order to consider whether there is a decline in the graduate labour market, does my noble friend the Minister agree that one cannot treat undergraduates as a generic composite entity? One surely has to define those who are seeking particular types of jobs, and so on and so forth. Is there really a decline in undergraduates seeking jobs?
§ Baroness Denton of WakefieldMy Lords, there is no evidence of a decline in graduates seeking jobs. There is evidence—and again I quote the Association of Graduate Recruiters—that there is still a great deal of competition for really good candidates with highly developed personal skills.
§ Lord McCarthyMy Lords, the noble Baroness says that advertising has been stabilised. I agree. However, does she agree that the critical point is whether demand has stabilised? Surely the Government could assist the stabilisation of demand during the recession if they were to increase graduate intake into the scientific Civil Service and the Civil Service, instead of cutting it back.
§ Baroness Denton of WakefieldMy Lords, that goes slightly beyond the scope of the original Question.