Skills Deepening or Credentialism? Education...

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29 AUSTRALIAN JOURNAL OF LABOUR ECONOMICS Volume 18 • Number 1 • 2015 • pp 29 - 51 Skills Deepening or Credentialism? Education Qualifications and Occupational Outcomes, 1996-2011 Tom Karmel, National Institute of Labour Studies, Flinders University Abstract We look at the changes to the ‘quality’ of jobs obtained by persons with particular qualifications over the period 1996 to 2011, where quality is based on an index which ranks 400 or so occupations by the level of qualifications in the occupation, average income of those who are full-time employed or occupational status. The occupational structure has changed in a way to favour the ‘better jobs’, but this has been swamped by the expansion in educational qualifications with the result that the average quality of the job obtained by a person with a particular qualification is lower in 2011 than in 1996. The census data allow a detailed characterisation of qualifications with four levels – higher degrees, degrees, diplomas and certificates III/IV – and nine fields of study. The groups most affected by the decline in the quality of jobs obtained are those with a higher degree (particularly business and administration) and diploma (particularly education and health). Keywords: Human capital, Skills; Occupational choice, Labor productivity JEL classification: J21, J24 1. Introduction The lynch-pin of public education policy over the last 50 years (or longer) has been ever increasing education levels. This policy direction is firmly entrenched (see, for example, Australian Workplace Productivity Agency, 2013) and has been based on demonstrable returns to education. For example, Coelli and Wilkins (2008) provide a comprehensive set of estimates of average returns for Australia and show that the labour market has remained pretty friendly to (university) graduates. Karmel (2013) also shows that relative hourly wage rates for individuals with varying educational qualifications have been quite stable for the period 1997-2009, despite the substantial Address for correspondence: Tom Karmel, National Institute of Labour Studies, Flinders University, Adelaide, SA 5000, Australia. Email: tom.karmel@flinders.edu.au Acknowledgement: This paper is based on work done while at the National Centre for Vocational Research. I would like to thank John Stanwick and John Moore for the assistance with the computations. © The Centre for Labour Market Research, 2015

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29AUSTRALIAN JOURNAL OF LABOUR ECONOMICS

Volume 18 • Number 1 • 2015 • pp 29 - 51

Skills Deepening or Credentialism? Education Qualifications andOccupational Outcomes, 1996-2011

Tom Karmel,NationalInstituteofLabourStudies,FlindersUniversity

Abstract We look at the changes to the ‘quality’ of jobs obtained by persons with particular qualifications over the period 1996 to 2011, where quality is based on an index which ranks 400 or so occupations by the level of qualifications in the occupation, average income of those who are full-time employed or occupational status. The occupational structure has changed in a way to favour the ‘better jobs’, but this has been swamped by the expansion in educational qualifications with the result that the average quality of the job obtained by a person with a particular qualification is lower in 2011 than in 1996. The census data allow a detailed characterisation of qualifications with four levels – higher degrees, degrees, diplomas and certificates III/IV – and nine fields of study. The groups most affected by the decline in the quality of jobs obtained are those with a higher degree (particularly business and administration) and diploma (particularly education and health).

Keywords:Humancapital,Skills;Occupationalchoice,Laborproductivity

JELclassification:J21,J24

1. Introduction Thelynch-pinofpubliceducationpolicyoverthelast50years(orlonger)hasbeeneverincreasingeducationlevels.Thispolicydirectionisfirmlyentrenched(see,forexample,AustralianWorkplaceProductivityAgency,2013) andhasbeenbasedondemonstrablereturnstoeducation.Forexample,CoelliandWilkins(2008)provideacomprehensivesetofestimatesofaveragereturnsforAustraliaandshowthatthelabourmarkethasremainedprettyfriendlyto(university)graduates.Karmel(2013)also shows that relativehourlywage rates for individualswithvaryingeducationalqualificationshavebeenquitestablefortheperiod1997-2009,despitethesubstantial

Address for correspondence: Tom Karmel, National Institute of Labour Studies, FlindersUniversity,Adelaide,SA5000,Australia.Email:[email protected]:ThispaperisbasedonworkdonewhileattheNationalCentreforVocationalResearch. I would like to thank John Stanwick and John Moore for the assistance with thecomputations.©TheCentreforLabourMarketResearch,2015

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increaseintheproportionoftheworkforcewithqualifications.However,logicallyatleast,anexpansionwilleventually leadtoadecrease in thereturntoeducationforsomepeople–ifeveryonehasaPhDtheninevitablysomewillendupdrivingtaxis.Concernsthattheexpansionofeducationcanleadtoasurplusofgraduateswereaired40yearsagowithFreeman(1976)arguingthatthereweretoomanygraduatesintheUnitesStatesinthe1960s,andtheproductionoftoomanygraduateswouldleadtounderutilisation of graduates’ skills.More recently, the concept of credentialism –bywhich ismeant theacquisitionofcredentialsnotneededfora job-hasreceivedattention(forexample,DockeryandMiller,2012).

Thepurposeof thispaper is toexplorefurtheroneparticularaspectof thepay-offtoeducation–thetypeofjobanindividualwithaparticularlevelofeducationislikelytoget.Thegeneralideahasbeenpresentedearlier(Karmel,2011).Weuseoccupationsasadevicetorankjobsandthencomparethedistributionsofjobsacrosstimefor individualswithparticulareducation levels. In thatpaper, forexample,wefoundthatbetween1996and2006,individualswithadiplomabecameconsiderablylesslikelytohaveajobinthetoptwodecilesofskilledjobs(basedonanindexwhichrankedoccupationsdependingontheirqualificationprofile).

Thiswayof lookingat thepay-off toeducationisrelatedto theconceptofovereducation(see,MavromarasandMcGuinness(2007)foranoverview).Graduatesare said to be overeducated if they are in jobswhich typically donot require thatlevel of education. Similarly, graduates aremismatched if they are in a jobwhichdoesnot require theparticular levelof education.Typically, it hasbeen found thatovereducationisassociatedwithpoorerlabourmarketoutcomessuchaslowerwagesandjobsatisfaction.Miller(2007)foundthatinAustraliaaroundahalfofworkerswith university degrees could be categorised as overeducated and argued that thiswasofsomeconcernbecauseofthehighcostoftheacquisitionofadegree.Sloane(2007) points to over education increasing in theUnitedKingdomwith the extentofovereducationrisingto30percentin2006.MavromarasandMcGuinnesspointtoovereducationbeinganissueinnumerouscountries,includingtheUnitedStates,Denmark,France,Ireland,Italy,Spain,Greece,PortugalandAustralia.

Inouranalysiswefocusonhowthejobdistributionhaschangedforagivenlevelofeducationratherthanachangeintheproportionofgraduateswhoareovereducated.Therewillbearelationshipbetweenthetwo–ifthedistributionofpersonswithacertainqualificationshiftstowardlessdesirablejobsthenwecanexpecttheproportionofovereducatedpersons tohave increased.Thedistributionalapproachwehaveadoptedhastheadvantageofnotrequiringadefinitionofspecificeducationrequirementsforanoccupation,notingthateducationrequirementsforanoccupationtendtochangeovertime.

Theextensioninthispaperisfourfold.First, thedataareupdatedto2011,taking advantage of the Census of that year.1 Second, the analysis considers two

1 In using the 1996 and 2011 Census data we had to contend with the Australian StandardClassificationofEducation(ASCED)replacingtheABSClassificationofQualifications(ABSCQ)andANZSCO replacing the earlier occupational standardASCO.Details of themethodologyhandlingthesechangescanbefoundinKarmel,StanwickandMoore(forthcoming).

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additional alternative indexes,withoccupations rankedon thebasisof incomeandalso by socioeconomic status, aswell by the qualifications profile. Third, changesin the occupational structure of the labourmarket are isolated, by using the 1996distributionofjobsasthebenchmark.Finally,theanalysisisundertakenatabroadfield of study, to emphasise the point that averagesmask considerable variation inpeople’s experiences.Wealsonote that theCensus allows afinegrained approachwiththeoccupationaldistributionscreatedfromaround400individualoccupations.

Thestructureofthepaperisasfollows.Inthenextsectionweconsiderthethree indexesused to rankoccupations. In section threewe showhoweducationalqualifications have increased and how the occupational distribution of jobs haschangedbetween1996and2011.Thisisfollowedbyananalysisoftheoccupationaldistributions, focussing first on the relationship between educational qualificationandoccupationaldistributionsin1996andthenthechangesbetween1996and2011.Section4repeatstheanalysisbyfieldofstudy.Weendwithashortdiscussion.

Ourmainfindingisthat,despitetheoccupationalstructurechangingtofavourthe better jobs, that the expansion in the proportion of personswith qualificationshas far out-stripped the change in the employment structure. This means that ingeneraltheaveragejobforpersonswithaparticularqualificationin2011isoflowerqualitythanin1996.Personswithhigherdegrees(particularlythoseinbusinessandadministration)anddiplomas(particularlyeducationandhealth)havebeenthemostaffected.Theformermostlikelyreflectstherapidexpansioninsupplyofpersonswithhigherdegrees,whilethelatterislargelyaconsequenceofchangesinminimumjobrequirements–forexample,degreesarenowrequiredfornursingandteaching.

2. Occupational Indexes Themainpointofthispaperistolookathowthelikelihoodofgettinga‘good’jobhaschangedforindividualswithaparticularlevelofqualification.Thisrequiresanordering of occupations from the best to theworst. Previously (Karmel, 2011)weorderedoccupationsbymeansofaskillsindex,whichassignedarankingtofourdigitASCO2occupationsonthebasisofthedistributionofqualificationsintheoccupation.Accordingtothatindexthemostskilledoccupationwas2421Universitylecturersandtutors(withahighproportionofindividualswithpost-graduatequalifications)andtheleastskilledoccupationwas9932Fastfoodcooks.

Analternativerankingofoccupationsisbyincome.Thisindexwasconstructedusing full-time employment by occupation by income data from the 2006Census.The precisemethod can be found inKarmel, Stanwick andMoore (forthcoming).The highest ranked occupation according to this index is2312 Specialist Medical Practitioners.

A third ranking is available from an index constructed at the ANU. TheASCOversionof this index(JonesandMcMillan,2001)is labelledANU42andisdescribedasanindexofsocio-economicstatus.Itreflectsqualificationlevels,incomeandoccupationalprestige.

2ThelatestversionisAUSEI06(Macmillanet al.2009).

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The essential feature of these indexes is that they can be used to rankoccupations.

Allofthesemeasureshavetheirlimitations.Forexample,theskillsmeasurecan be criticised for being self-referential if we are particularly interested in theoutcomesofpeoplewithqualifications.Whydoesworking inanoccupationwheretherearefewwithadegreemakethejoblessdesirable?Alsotheskills indexdoesnot account for skills learnt on the job (although the returns to experience tend tobehigher inprofessional jobsrelativetotradeorunskilledjobs).Nevertheless, it isintuitively attractive that occupations typically performedby individualswhohaveinvested inhigh levelsofeducationarehighlydesirable.Similarly,average incomedoesnotcapturemanyimportantattributesofwages,suchasthelevelofentrylevelwages,incomevolatility,andlikelywageprogression.Thesocioeconomicstatusindexsoundsbroaderconceptuallybutinpracticebuildsprimarilyonlevelsofqualificationsandwages.

Thus, there isno singlemeasureofwhatmakesagood job.That said, thethreerankingsarehighlycorrelated.Ifwemaptheindexrankingsonthe2006full-timeemploymentdatatoobtainpercentiles(avalueof10,forexample,indicatesthattheoccupationisinthetop10percentofjobsaccordingtothatindex),thenwecancalculatethecorrelationsbetweenthethreepossibilities(table1).3

Table 1 - Correlations between Occupations according to the Skills Index, the Income Index and Occupational Status (ANU4)

Skills Income StatusSkills 1.00 0.72 0.92Income 1.00 0.76Status 1.00

The correlations are high, suggesting that the preciseway occupations areorderedisnotagreatissue.

Themostsimilarindexesaretheskillsindexandtheoccupationalstatusindex.Theleastsimilararetheskillsindexandtheincomeindex.ItappearsthattheANU4occupational indexliesbetweentheothertwo,althoughit isverycloselyrelatedtotheskillsindex.Tokeeptheanalysistractable,werestricttheensuinganalysistotheskillsandincomeindexes–thetwowhichdifferthemost.Iftheresultsoftheanalysisarerobusttothechoiceofindexthenwedonotneedtoparticularlyconcernedaboutpreciselyhowtheoccupationsareranked.

Togivesomeflavouroftheoccupationalrankingswepresentintable2thehighest and lowest rankedoccupationsaccording to the skills and income indexes.Thehighestrankedoccupationisatthetopofthetableandthelowestatthebottom.Thoseoccupationsthatareinthetop(bottom)20occupationsaccordingtothetwoindexesarebolded.

3The three rankings foreachoccupationcanbe found inKarmel,StanwickandMoore (2014)(noting thatoccupationswith less than500employedpersons in2006weredeletedbecauseofdoubtsaboutreliability).

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Table 2 - Highest and Lowest Ranked Occupations According to Skills and Income Occupational Indexes

Highest paid occupations Highest skilled occupations2312 SpecialistMedicalPractitioners 2421 UniversityLecturersandTutors1111 LegislatorsandGovernmentAppointed 2110 NaturalandPhysicalScience Officials Professionals,nfd2311 GeneralistMedicalPractitioners 2514 Psychologists2381DentalPractitioners 2387 ChiropractorsandOsteopaths1212 CompanySecretaries 2312 SpecialistMedicalPractitioners2127MiningandMaterialsEngineers 2522 Economists2213 CorporateTreasurers 2113 LifeScientists1221 EngineeringManagers 2112 GeologistsandGeophysicists1112 GeneralManagers 2119 OtherNaturalandPhysicalScience Professionals1224 InformationTechnologyManagers 2115 MedicalScientists2521 LegalProfessionals 1293 EducationManagers4988PowerGenerationPlantOperators 2420 UniversityandVocationalEducation Teachers,nfd2112GeologistsandGeophysicists 2393 Dietitians3210 FinanceAssociateProfessionals,nfd 2311 GeneralistMedicalPractitioners1291 PolicyandPlanningManagers 2492 EnglishasaSecondLanguageTeachers2295PropertyProfessionals 2386 SpeechPathologists1293EducationManagers 2381DentalPractitioners2522Economists 2293 Mathematicians,Statisticiansand Actuaries1213 HumanResourceManagers 2322 NurseEducatorsandResearchers2541AirTransportProfessionals 2385 PhysiotherapistsLowest paid occupations Lowest skilled occupations9200FactoryLabourers,nfd 9915 RailwayLabourers8313 DomesticHousekeepers 9913 PavingandSurfacingLabourers4931 Hairdressers 9213 MeatandFishProcessWorkers6131 Receptionists 9912 EarthmovingLabourers4513 Cooks 7297 Clay,StoneandConcreteProcessing MachineOperators6391 DentalAssistants 8115 BettingClerks8296ServiceStationAttendants 6324HospitalityTrainees9921FarmHands 8116 OfficeTrainees9931Kitchenhands 7211 SewingMachinists9932FastFoodCooks 9931 Kitchenhands8291 CheckoutOperatorsandCashiers 9000LabourersandRelatedWorkers,nfd9221HandPackers 9221 HandPackers6323Waiters 7112 ForkliftDrivers8315 LaundryWorkers 9933 FoodTradesAssistants9933FoodTradesAssistants 8291 CheckoutOperatorsandCashiers6312 Children’sCareWorkers 9219 OtherProcessWorkers7211 SewingMachinists 4612 Shearers6392VeterinaryNurses 9215 WoodProductsFactoryHands6324HospitalityTrainees 9991 GarbageCollectors8116OfficeTrainees 9932 FastFoodCooks

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While the correlation between these two indexes is high at 0.72, there areconsiderablenumbersofoccupationsforwhichtheincomerankingiswellabovetheskillsranking,andviceversa.Togivesomeinsightintothesedifferences,weshowthe 10 occupations forwhich the income percentile ismuchmore favourable thantheskillspercentile,the10occupationsforwhichtheincomeandskillspercentileshavethegreatestdegreeofconcordance,andthe10occupationsforwhichtheskillspercentileismuchmorefavourablethantheincomepercentile.

Table 3 - Selected Occupations and Index Values

Difference between income 2006 full- Income ANU4 Skills and skillsOccupation time emp. per cent per cent per cent per centOccupationsinwhichincome>skillranking7911 Miners 20,667 8.1 82.1 83.4 -75.34986Drillers 4,692 11.6 77.3 80.3 -68.77912BlastingWorkers 757 9.3 82.1 74.6 -65.37315TrainDriversandAssistants 7,171 20.1 83.3 80.2 -60.17122Crane,HoistandLiftOperators 6,868 30.3 83.9 82.2 -51.99915RailwayLabourers 2,727 46.5 98.4 97.1 -50.69911MiningSupportWorkersand 2,765 33.0 87.0 83.6 -50.6 Driller’sAssistants7124PulpandPaperMillOperators 1,512 34.5 84.0 81.9 -47.54987Chemical,PetroleumandGas 5,013 12.1 48.2 58.8 -46.7 PlantOperators7913StructuralSteelConstructionWorkers 10,990 31.7 82.3 77.8 -46.17111 MobileConstructionPlantOperators 31,696 47.2 93.8 91.8 -44.63393TransportCompanyManagers 9,076 36.8 38.6 81.0 -44.2Occupationsinwhichincome=skillranking(a)9111Cleaners 59,001 92.3 91.5 92.8 -0.53291OfficeManagers 66,261 53.4 42.2 53.5 -0.19931Kitchenhands 18,131 97.9 89.0 98.0 -0.19933FoodTradesAssistants 1,467 99.1 87.8 99.2 -0.19221HandPackers 23,832 98.6 98.2 98.6 0.03120BuildingandEngineeringAssociate 8,961 34.6 32.3 34.5 0.1 Professionals,nfd8211SalesAssistants 156,772 90.5 81.8 90.3 0.24000TradespersonsandRelatedWorkers,nfd 12,306 44.2 50.0 44.0 0.26213RetailandCheckoutSupervisors 15,927 80.9 85.6 80.6 0.42521LegalProfessionals 41,167 3.7 1.4 3.3 0.4Occupationsinwhichincome<skillranking3111MedicalTechnicalOfficers 10,012 80.3 32.8 35.2 45.16392VeterinaryNurses 2,820 100.0 73.2 51.9 48.16312 Children’sCareWorkers 36,943 99.8 66.2 51.4 48.33997LibraryTechnicians 3,072 79.8 36.5 29.8 50.03411EnrolledNurses 8,289 82.1 34.5 30.4 51.74931Hairdressers 27,656 95.4 70.7 42.5 52.92394NaturalTherapyProfessionals 1,998 69.7 10.8 13.2 56.53494MassageTherapists 1,931 82.7 34.6 24.6 58.22515MinistersofReligion 10,975 69.4 21.1 10.3 59.16395PersonalCareConsultants 8,817 93.8 45.2 34.7 59.2

Note:(a)within+/-0.5percent.

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Itisinterestingtonotethatthetopgroup,withveryhighincomerankings,tendtobe inmaledominatedoccupations in industrieswhere there isconsiderableunionpower.Bycontrast,thebottomgroupofoccupations–whereincomerankingsaremuchlowerthanskillsrankings-islargelyfemaledominated,wherequalificationsareexpectedbutpayispoor.

3. Changes in Education Levels and Occupations 1996 to 2011 The crux of the paper is that the relationship between occupation and educationalqualificationshasbeenchanging,withtheincreaseineducationlevelsoccurringfasterthatthat‘required’bychangesintheoccupationstructure.Thisimpliesthat-intheterminologyoftheSkillsAustralia(2009)–‘skillsdeepening’hasoccurred,withthelevelsofqualification increasingwithinoccupations.Table4shows that thefifteenyears1996to2011haveseenconsiderableincreasesintheproportionoftheworkforcewithqualifications.

Table 4 - Proportion of Employed Persons by Highest Qualification, 1996, 2006 and 2011, Per Cent

Per cent point change 1996 1996 2006 2011 to 2011Higherdegree 2.1 3.8 5.1 3.0Bachelordegree 13.6 18.4 20.9 7.3Diploma/advanceddiploma 8.2 9.0 10.1 1.8CertificateIII&IVlevel 14.3 18.2 19.5 5.2Othercertificates 10.7 8.6 7.1 -3.6Nonon-schoolqualification 51.0 41.9 37.3 -13.7Total 100 100 100

Notes: Higherdegreeincludesdoctorates,mastersandpost-graduatedegreelevel(notfurtherdefined);bachelordegreesincludebachelordegreesandgraduatediploma/graduatecertificates;othercertificatesincludecertificatesI/II,certificatesnotfurtherdefined,andlevelinadequatelydescribedornotstated.Fourdigitoccupationswithlessthan500personsinthe2006censushavebeenexcludedfromtheanalysisinthisandthefollowingthreetablestobeconsistentwiththerestoftheanalysisinthispaper,buttheyonlyaccountforaverysmallproportionofalloccupationsanyway.Whenoriginallyconstructingtheskillsindex,occupationswithlessthan500peoplewereexcluded(see,Karmel,2011).Source:DerivedfromtheCensusofPopulationandHousing,1996,2006and2011.

Weseethattheproportionoftheworkforcewithqualificationshasincreased

quitedramaticallyovertheperiod.ThegreatestincreasehasbeenintheproportionwithabachelordegreeandcertificateIII/IV.

There has been substantial change in the occupational structure of theworkforce(table5),reflectingtheimpactoftechnologicalandotherstructuralchanges(KellyandLewis,2010),but the increase in levelsofqualificationshasbeenmuchgreater than thatneeded tomaintain thestatusquo.Thuswesee in table6 that ineveryoccupationtherehasbeenanincreaseintheproportionofworkerswithpost-graduate,bachelordegree,diplomaandcertificateIII/IVqualifications,andadecline

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intheproportionwithnoqualification.Thetablealsoshowsanelementofupgradinginqualificationswiththeproportionwithacertificateother thanat theIII/IVleveldeclining.

Table 5 - Employment Growth 1996 to 2011, by ASCO2 Major Groups (Per Cent)

Per cent 1996 2011 change1 Managersandadministrators 708,626 877,325 23.82 Professionals 1,306,709 2,091,565 60.13 Associateprofessionals 860,501 1,237,677 43.84 Tradespersonsandrelatedworkers 995,523 1,174,805 18.05 Advancedclericalandserviceworkers 329,673 272,064 -17.56 Intermediateclerical,salesandserviceworkers 1,222,762 1,763,988 44.37 Intermediateproductionandtransportworkers 660,330 784,406 18.88 Elementaryclerical,salesandserviceworkers 677,190 912,194 34.79 Labourersandrelatedworkers 666,221 741,896 11.4Total 7,427,535 9,855,920 32.7

Source:DerivedfromtheCensusofPopulationandHousing,1996and2011.

Table 6 - Changes in the Proportion of Occupations (ASCO 2 Major Groups) with Qualifications, 1996 and 2011 (Percentage Points)

Diploma/ Certificate Higher Bachelor advanced III & Other No non-school degree degree diploma IV level certificates qualification1 Managersand 5.9 10.3 2.5 2.5 -4.2 -17.1 administrators2Professionals 6.3 7.8 -6.8 2.0 -3.5 -5.83 Associateprofessionals 2.6 8.3 5.2 4.7 -5.8 -15.04 Tradespersonsand 0.2 1.5 1.9 6.1 -3.5 -6.3 relatedworkers5 Advancedclericaland 1.7 8.0 6.4 9.0 -9.7 -15.4 serviceworkers6 Intermediateclerical, 1.6 5.5 4.5 12.0 -3.9 -19.6 salesandserviceworkers7 Intermediateproduction 0.6 2.0 2.1 7.7 -1.0 -11.5 andtransportworkers8 Elementaryclerical, 1.1 3.6 2.7 5.4 -1.7 -11.2 salesandserviceworkers9 Labourersandrelated 0.6 2.4 2.0 7.2 -0.5 -11.7 workersTotal 3.0 7.3 1.8 5.2 -3.6 -13.7

Source:DerivedfromtheCensusofPopulationandHousing,1996and2011.

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Thus we see that people with higher degrees increased their share ofemploymentbythreepercentagepointsbetween1996and2011,butincreasedtheirshareofemploymentinmanagers and administratorsandprofessionalsby5.9and6.3 percentage points respectively.We also see that the proportion of peoplewithqualifications has increased even in occupations where there is unlikely to be alink between the qualification and thework. For example,we see increases in theproportionofworkerswithahigherdegreeinintermediate clerical, sales and service workers; intermediate production and transport workers; elementary clerical, sales and service workers;andlabourers and related workers.

Finally,wenotethatthegrowthofqualificationshasbeenunevenacrossfieldsofstudy(table7).

Table 7 - Average Annual Growth 1996-2011 (Per Cent)

Diploma and Higher Bachelor advanced Cert Other degree degree diploma III & IV quals TotalAgriculture,Environmental 8.9 7.6 2.9 5.7 2.3 4.3andRelatedStudiesArchitectureandBuilding 14.3 6.4 3.9 2.8 1.3 2.7ManagementandCommerce 12.2 6.5 5.0 17.6 2.0 5.1Education 7.9 3.2 -2.3 n.a. 3.8 3.0EngineeringandRelated 6.8 4.7 2.0 1.1 1.7 1.8TechnologiesHealth 6.4 5.8 -0.5 19.0 1.1 3.3NaturalandPhysicalSciences 6.6 4.4 4.8 12.3 3.8 4.8+InformationTechnologySocietyandCulture+ 6.6 4.0 7.0 14.7 5.2 5.8CreativeArtsFood,hospitalityandpersonal 9.3 5.9 4.3 3.9 -0.7 0.2services+mixedfields

Total 8.3 5.1 3.4 3.9 -0.1 1.5

Source:DerivedfromtheCensusofPopulationandHousing,1996and2011.

Thegrowthinhigherdegreeshasbeenparticularlyhighinarchitecture and buildingandmanagement and commerce.Thegrowthindegreeshasbeenrelativelyuniformwhilethegrowthindiplomaswashighestinsociety and culture and creative artsandmanagement and commercebutnegativeinacoupleofareas(presumablydegrees are edging out diplomas). The growth in certificates III and IV is quiteconcentrated:management and commerce, health, natural and physical sciences and information technology, and society and culture and creative arts all have annualgrowthratesexceeding10percentperannum.

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4. Occupational Distributions Wenowanalysethechangeintherelationshipbetweeneducationlevelandoccupationinarathermoresophisticatedway,bylookingattheoccupationaldistributionofjobsforthosewithaparticularlevelofqualification.

Beforelookingattheoccupationaldistributionsatthequalificationlevelweshowhowtheoccupationaldistributionshavechangedbetween1996and2011.Thedistributions are represented by Lorenz style curves,with the cumulative share ofemploymentin2011ontheyaxisandthecumulativeshareofemploymentin1996onthexaxis(eachpointisanoccupation).Iftherehadbeennochangeinthedistributionofjobsbyoccupationacrossthetwoperiodsthenthecurvewouldbea45degreeline.

Figure1showsthechangebasedonthedistributioninwhichjobsarerankedbyskilllevels,figure2byincomelevels.

Weseethatbothcurvesaretotheleftofthe45degreeline,indicatingthatemployment growth has been biased toward the better jobs, irrespective of whichorderingofoccupationsisused.Forexample,ifwetaketheoccupationcorrespondingto the 40th percentile in 1996 according to the skills index (figure 1),we see thataround45percentofjobsin2011wereatthisskillslevelorhigher.Thatis,the‘better’occupationsgrewfasterthanthelowerskilloccupations.

We now consider the occupation distributions at the qualification level. Infigure3,weshowtheLorenzstylecurvesfor1996foreachofthequalificationlevels,basedontheskillsindex.Onthexaxisisthecumulativedistributionofalljobs,withthe‘best’jobatthezeropoint.Ontheyaxisisthecumulativedistributionofthejobsfor individualspossessingaparticularqualification.Rather thanpresent thisforallpersonswelookat25-44yearolds–thisagegroupbestreflectsthejobprospectsofyoungpeopleoncetheyhavecompletedtheireducation.4Figure4showsthecurvesfortheincomeindex.

Theabovefiguresmapout the cumulativedistributionsof the employmentlevelforeachqualification;onecanreadofftheproportionofemploymentforeachqualificationthatcorrespondstoanypointintheoverallemploymentdistribution.So,takingtheskillindexforexample(figure3),weseethataround55percentofthosewithahigherdegreehadjobsinthetopdecileofjobs,withthecorrespondingfigureforbachelordegreesaround40percent,fordiplomas15percentandclosetozeroforthosewithacertificateIII/IV.Similarstatisticscanbeextractedatanypercentileoftheoveralljobdistribution.Thereisaclearhierarchyofqualifications,andthispatternisquiterobustinrespectofthechoiceofoccupationalindex.

4Theanalysiswasalsodoneforallpersonsaged15-64years.

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Figure 1 - Cumulative Shares of Employment (15-64 year olds) for Each Occupation, 1996 and 2011, Occupations Ordered by Skill Levels

Figure 2 - Cumulative Shares of Employment for Each Occupation (15-64 year olds), 1996 and 2011, Occupations Ordered by Income Levels

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40AUSTRALIAN JOURNAL OF LABOUR ECONOMICSVOLUME 18 • NUMBER 1 • 2015

Figure 3 - Cumulative Shares of Employment by Qualifications, 1996, 25-44 years, Occupations Ranked by Skill Level

Figure 4 - Cumulative Shares of Employment by Qualifications, 1996, 25-44 years, Occupations Ranked by Income Level

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Whenwestartconsideringchangesovertimeandthevariousfieldsofstudyweendupwithaverylargenumberofgraphs.Thisbecomesalittleoverwhelmingandthusitisexpedienttohaveasinglesummarystatistictosummarisethedistributions.Thesimplestsinglestatistictocapturetheshapeofthecurveisitsmeanorexpectedvalue,withtheunitsbeingthepercentileoftheoveralldistributionofjobsasdisplayedonthexaxis.5Thishasasimpleinterpretation:forexampleavalueof35foraparticularcurvemeansthattheaveragejob(orexpectedjob)isatthe35thpercentileofalljobs(with0representingthebestjob).

Calculatingthis‘meanpercentile’,givesthefollowingtable.

Table 8 - Mean Percentile of Jobs by Qualification Level, Persons Aged 25-44 Years, 1996

Income SkillsHigherdegree 18 15Bachelordegree 28 22Diploma 41 34CertificateIII/IV 51 51

Source:ABS1996censusdata.We see the same general pattern, irrespective of the index used to rank

occupations.The‘averagejob’forpersonswithahigherdegreeisinthetop15-18thpercentileof jobs,dependingonwhichoccupational indexandwhichagegroup isused.Bycontrast,thosewithacertificateIII/IVcanexpectonaveragetogetajobinthemiddleofthedistribution(51stpercentile).

Wenowmovetothechangesinthedistributionsbyqualificationlevel.Figures5(a)to5(d)presentthreeLorenzstylecurvesforeachofthefourqualificationlevels,basedon theskills index (i.e.occupationsare ranked from themosthighlyskilled(qualified)totheleast).Eachofthesefigureshasthreecurves:

• The1996distributionofjobsforthequalificationplottedagainstthe1996distributionofalljobs.

• The2011distributionofjobsforthequalificationplottedagainstthe2011distributionofalljobs.

• The2011distributionofjobsforthequalificationplottedagainstthe1996distributionofalljobs.

In making an assessment of whether in 2011 individuals with a certainqualification are obtaining similar jobs to the situation in 1996, it is the first andthirdofthesecurvesthatarerelevant.Thisisbecausethe2011jobdistributionhasshiftedtotheleftofthe1996distributionbecausethebetterjobshavegrownrelativelyquickly(asillustratedearlierinfigures1and2).Tocomparethefirstandsecondofthesecurveswould‘movethegoalposts’,becausethedefinitionof,say,thetopdecileofjobsin2011isamorerestrictivesetofoccupationsthanin1996.

Weseethatforeachqualification,theshareof‘good’jobsdeclines,reflectingthe fact that the increase in people with each of the qualifications has been greater5Infact,themeanpercentileofaLorenzcurveisapproximatelyequaltotheareaabovethecurve.SothesummarymeasureiscloselyrelatedtotheGinicoefficient(ameasureoftenusedtomeasureinequality)whichcanbecalculatedastwicetheareabetweenthecurveandthe45degreeline.

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thantheexpansioningoodjobs.However,thehigherdegreesanddiplomashavebeenparticularlyaffected.Forexample,infigure5(a)weseethatin1996almost80percentofhigherdegreegraduateshadajobinthetop20percentofjobs,whilein2011thishaddroppedtoaround65percent(keepingthe1996definitionofthetop20percentofjobs).

Figure 5(a) - Cumulative Shares of Employment for those with a Higher Degree Qualification, 1996 and 2011, 25-44 years, Occupations Ranked by Skill Level

Figure 5(b) - Cumulative Shares of Employment for Those with a Bachelor Degree Qualification, 1996 and 2011, 25-44 years, Occupations Ranked by Skill Level

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Ski l ls Deepening or Credential ism? Education Qualif ications and Occupational Outcomes, 1996-2011

Figure 5(c) - Cumulative Shares of Employment for Those with a Diploma Qualification, 1996 and 2011, 25-44 years, Occupations Ranked by Skill Level

Figure 5(d) - Cumulative Share of Employment for Those with a Certificate III/IV Degree Qualifications, 1996 and 2011, 25-44 years, Occupations Ranked by Skill Level

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Similarpatternsemergefortheincomeindex.Ratherthanpresentanothersetofgraphswesummarisethechangesthroughthechangeintheaveragejob(table9).

Table 9 - Changes in the Average Job, 1996 to 2011, 25-44 Years, Percentile of 1996 Job Distribution

Jobs ordered by skill Jobs ordered by income Increase Increase Mean in mean Mean in mean 2011 percentile 2011 percentile Mean (1996 (percentile Mean (1996 (percentile 1996 base) points) 1996 base) points)Higherdegree 15 23 8 18 26 8Bachelordegree 22 26 4 28 30 2Diploma 34 43 9 41 48 7CertificateIII/IV 51 52 1 51 54 3

Note:1representsthebestjob,100theworst.

Weseearobustpattern.Therehasbeenadeclineinallqualificationlevels,butthatthosewithahigherdegreeoradiplomahavebeenmoreaffectedthanthosewithacertificateIII/IVorabachelordegree.

5. Occupational Distributions by Field of Study Wecompleteouranalysisbylookingatthedistributionsofjobsandtheirchangesbyfieldofstudy.Wefirstpresentthemeanjobforeachqualificationandfieldofstudyfor1996,basedontheskillsindex(table10)andtheincomeindex(table11).

Table 10 - Mean Job, by Qualification and Field of Study, Persons 25-44 years, 1996 (1996 Job Distribution Percentiles Based on Skills Index)

Higher1996 Skill 1996 base Cert III/IV Diploma Bachelor degreeEngineering 49 35 24 16Education ** 24 16 11Health 43 24 13 7Agriculture 65 57 37 26ArchitectureandBuilding 52 38 21 15BusinessandAdministration 47 44 29 22NaturalandPhysicalScience 46 36 24 13SocietyandCulture 48 40 27 15Miscellaneousfields 56 41 49 22Total 51 34 22 15

**TherewasnoonerecordedashavingacertificateIII/IVinthefieldofeducationinthe1996censusdataprovidedtous.Note:Inthistableandtable11belowthe1996fieldshavebeenusedasthetablespertainsolelyto1996data.Toreiteratethough,NaturalandPhysicalSciencesalsolargelyincorporatesInformationTechnology,SocietyandCulturealsolargelyincorporatesCreativearts,andMiscellaneousfieldsalsolargelyincorporatesFood,HospitalityandPersonalServices.

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Table 11 - Mean Job, by Qualification and Field of Study, Persons 25-44 Years, 1996 (1996 job Distribution Percentiles Based on Income Index)

Higher1996 Income 1996 base Cert III/IV Diploma Bachelor degreeEngineering 47 31 20 15Education ** 39 31 23Health 54 42 26 13Agriculture 62 53 37 32ArchitectureandBuilding 47 33 23 19BusinessandAdministration 40 41 25 16NaturalandPhysicalScience 51 38 25 19SocietyandCulture 67 54 32 22Miscellaneousfields 72 38 42 14Total 51 41 28 18

**TherewasnoonerecordedashavingacertificateIII/IVinthefieldofeducationinthe1996censusdataprovidedtous.

Aclearhierarchyemerges; thequalifications ‘peckingorder’ ismaintained

ineachfieldofstudy,irrespectiveofwhichindexisused:themeanjobforsomeonewithahigherdegreeisbetterthanforabachelordegree,whichinturnisbetterthansomeonewithadiploma,whichinturnisbetterthansomeonewithacertificateIII/IV(withtheexceptionof‘mixedfieldsforwhichthepositionofdiplomasanddegreesarereversed,notingthatthatthemixedfieldcategoryisdifficulttounderstand).However,the rankings of fieldswithin each qualification level do depend to some extent bywhichindexisused.

Somefieldsstandout.Amonghigherdegreesthefieldwiththebestaveragejobirrespectiveoftheindexishealth.Butamongthosewithabachelordegree,accordingtotheskillsindexthefieldwiththebestaveragejobishealth(13thpercentile)whileaccordingtotheincometheindexthefieldwithbestaveragejobisengineering(20thpercentile).Similarly,among thosewithadiploma, thefieldswith thebestaveragejob according to the skills index arehealth andeducation (24th percentile),whilethefieldwiththebestaveragejobaccordingtotheincomeindexisengineering(31stpercentile).Irrespectiveofwhichindexisusedagriculturefarespoorly.

Wealsoseesomeoverlapbetweenqualifications.Forexample,accordingtotheincomeindex,adiplomainengineeringonaveragewillprovideabetterjobthanadegreeineducation, society and cultureandagriculture.

Wenowlookatthechangesinthestylecurvesbetween1996and2011byfieldofstudy.Againweusethemeantosummarisethedistribution.

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Table 12 - Change in Mean Percentile Job, 1996 to 2011, by Qualification and Field of Study, Persons 25-44 years, 1996 (1996 Job Distribution Percentiles Based on Skills Index)

Higher Cert III/IV Diploma Bachelor degreeEngineering 0 4 -1 4Education ** 10 0 4Health 1 7 2 2Agriculture 1 0 -2 -4ArchitectureandBuilding 0 2 2 0Business,Administration 7 2 4 11NaturalandPhysicalScienceand -3 1 4 10InformationTechnologySocietyandCultureandCreativeArts 3 3 3 5Food,hospitalityandpersonalservices 0 14 6 4+mixedfieldsTotal 1 9 4 8

**TherewasnoonerecordedashavingacertificateIII/IVinthefieldofeducationinthe1996censusdataprovidedtous.

Table 13 - Change in Mean Percentile Job, 1996 to 2011, by Qualification and Field of Study, Persons 25-44 years, 1996 (1996 Job Distribution Percentiles Based on Income Index)

Higher Cert III/IV Diploma Bachelor degreeEngineering -2 2 -1 3Education ** 14 2 7Health 12 8 3 7Agriculture 1 2 0 -5ArchitectureandBuilding -2 2 1 1Business,Administration 13 3 5 13NaturalandPhysicalScienceand -8 -1 3 6InformationTechnologySocietyandCultureandCreativeArts 2 1 2 4Food,hospitalityandpersonalservices+mixedfields 0 31 20 21Total 3 7 2 8

**TherewasnoonerecordedashavingacertificateIII/IVinthefieldofeducationinthe1996censusdataprovidedtous.

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Whatisinterestingabouttheseresultsbyfieldofstudyisthevariationinthechangeinthemeanpercentile:

Engineering: according to the income index thosewith engineering qualificationshavelargelymaintainedthequalityoftheirjobs.Accordingtotheskillsindex,therehave been small declines in the average quality of higher degrees (four percentilepoints)anddiplomas(threepercentilepoints).

Education:thosewithadiplomaorahigherdegreehaveseenasignificantdeclineinthequalityoftheirjobs.

Health: diplomas have been badly affected irrespective of which index is used(declinesof eight toninepercentile points).However, according the income index,therehavealsobeendeclineswithin theotherqualifications–13percentilepoints(certificate III/IV),fivepercentilepoints (bachelordegree)and13percentilepoints(higherdegree).

Agriculture: this field is one which has seen little decline in the quality of jobsobtained.Infactthereareexampleswheretherehasbeenamodestimprovementinthe quality of jobs, notably a four to five percentile improvement for thosewith ahigherdegree.

Architecture and building: this field has seen little change in the quality of jobsobtained.

Business and administration: personswith a certificate III/IVor ahigherdegreehave seen largedeclines in thequalityof jobs (of betweeneight and13percentilepoints).Personswithadegreehaveseenamoremodestdecline(fivepercentilepoints).

Natural and physical sciences and information technology:personswithahigherdegreehaveseenalargedeclineinthequalityoftheirjobs(ninepercentilepointsontheskillsindexandsixpercentilepointsontheincomeindex).Personswithabachelordegreehaveseenalesserdecline,andthosewithadiplomahavebeenlittleaffected.Against theoverall trend thosewithacertificateIII/IVhaveseenan improvement,butitshouldbenotedthattherearerelativelyfewcertificatesdeliveredinthephysicalsciences-thisfieldisdominatedbyhigherlevelqualifications.

Society and culture and creative arts:aswithmanyofthefieldsthegroupthathasseenthelargestdeclineinthemeanoccupationispersonswithahigherdegree(fourtofivepercentilepoints).Thosewithabachelordegreehaveseenamoremodestdecline(threepercentilepoints).

Food, hospitality and personal services, and mixed fields:theresultsforthisfieldgrouping needs to be treatedwith caution (a) because there are hardly any higherdegreesandfewbachelordegreesinthisgrouping,and(b)becauseofthedisparatenatureofoccupationsthisgroupingoffieldsisill-defined.

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Onepointtoemergefromtheaboveanalysisisthatatthislevelofdisaggregationthechoiceofindexdoesnotmakeahugedifference.Itcertainlyaffectsthemagnitudeof thechangesbutnot thebroadpatterns.Theoverallpictureis that therehavebeendeclinesintheaveragequalityofjobsparticularlyforthosewithadiplomaorahigherdegree. And particular qualifications have been affected, notably: higher degrees inbusiness, administration,diplomas ineducationandhealthandcertificatesIII/IVinbusiness, administration. The only specific qualification which shows a completelydifferent picture depending on the choice of index in certificates III/IV in health:according to the skills index therewas virtually no change, while according to theincomeindextherewasadeclineof12percentilepointsintheaveragequalityofthejob.

6. Concluding Comments Theconventionalwayoflookingatthereturntoeducationistofocusonemploymentratesandrelativewages.However,inthispaperwehavetakenadifferentapproachandlookedatthereturnintermsofthe‘quality’ofthejobthatanindividualobtains.Qualityisdefinedbyoccupation(some400ofthem)withtheoccupationsrankedbyskilllevel(proxiedbythequalificationprofileoftheoccupation)andaverageincome(ofafull-timeworker).Ourapproachwastolookathowthedistributionofjobsforindividualswithparticularqualificationshaschangedbetween1996and2011,withthebenchmarkdistributionbeingtheonein1996.Wefocusedontheagegroup25-44years,thatbeingthemostrelevantgroupforyoungpeopleembarkingontheirpost-schooleducation.

Onamethodologicalnote,onemightquibblewiththewholeconceptofjob‘quality’;what isagood job foroneperson isabadone for someoneelseandourindexesofoccupationalqualitycaptureonlycertainattributesofajob.However,atanintuitivelevel,allwouldacknowledgethatsomejobsarebetterthanothers.Ouruseoftwoindexesprovidesatestofrobustnesstotheanalysis.Asanaside,thetwoindexesweusearehighlycorrelatedbuttherearedifferencesandmanyofthosedifferencesappeartoreflectindustrialhistoryandthedegreeoffeminisationofoccupations.

Whathasemergedisthatoverthis15yeartimeperiod,thedistributionofjobshaschangedinwaytofavourthebetterjobs.Thatis,anytechnologicalchangeoverthisperiodhasbeen,at least to someextent, skills-biased.However, theexpansionin the proportion of personswith qualifications has far out-stripped the change intheemploymentstructure.Thismeansthatwithinoccupationstherehasbeen‘skillsdeepening’, with a higher proportion of individuals having qualifications (or aqualificationatahigherlevel).Analternativewayoflookingatthesamedata,andtheoneadoptedinthispaper,istolookatthedistributionofjobsforpeoplewithacertainqualification. Ingeneral theaverage job forpersonswithparticularqualification in2011isoflowerqualitythanin1996.Personswithhigherdegrees(particularlythosein business and administration) and diplomas (particularly education and health)havebeenthemostaffected.

Intryingtomakesenseofthesefindings,thereseemtobeanumberofforcesatwork.First,thereisnodoubtthatthelabourmarketischanginginawaythatfavourspersonswithqualifications,butthereisequallynodoubtthatthesupplyofpeoplewithqualificationshasgrownmorethancommensurately.Oneelementthatmustbetaken

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intoaccountistheroleofregulation.Anobviousexampleisthedeclineinaveragejob quality of thosewith a diploma in education or health.Changes inmandatoryqualificationshavemeant thatadiploma in thoseareasno longerallowsentry intothesametypesofjobsasitoncedid.Otherareaswhichhavebeenaffectedarethoseoccupationswhichhavebecomemorehighlyregulated.Examplesherearefinancialservices, childcare and aged care.Tooperate in these occupations is requiring thepossessionofveryspecificqualifications.Anexampleofwheretherehasbeena‘defacto’changeinrequiredqualificationsisintheuniversitysectorwhereadoctoratehasbecomevirtuallyanentryrequirementformostacademicjobs.

However,notallqualificationshavebeenaffectedbychangesinregulationorentryrequirementstothesameextent.Muchofthedeclineintheaveragequalityofthejobheldbypersonswithahigherdegreecansimplybeexplainedbytheinteractionofsupplyanddemand.Relativelyfewjobs‘require’ahigherdegree,implyingthattheexpansioninthosewithahigherdegreehasincreasedthecompetitionforgoodjobs.Personswithahigherdegreeinbusinessadministrationareacaseinpoint,andthereiscertainlyconsiderableanecdotalevidencepointingtoanMBAnolongerbeingafasttrackintoatopjob.

ThetwoqualificationswheretherehasbeenthesmallestchangehavebeenbachelordegreesandcertificatesIII/IV.Overall,therehasbeensomedeclineintheaveragequalityofthejobbutthesedeclineshavegenerallybeensmall.

Are there any policy implications from the analysis? First, from a youngperson’spointofviewthechangingrelationshipbetweenqualificationsandthelabourmarketisveryrelevanttoeducationalchoice.Particularqualificationsonthewholewillnotguaranteethesamesortofjobasheldbyearliercohortswiththatqualification.At this level therehasbeencredentialcreep.Nevertheless therelationshipbetweenlevelofqualificationandthedistributionofjobsisstillstrong.Whileahigherdegreehasseenthegreatestdeclineintheaveragequalityofjobs,itisstillthecasethatonaveragethosewithhigherdegreesobtainbetterjobsthanthosewithabachelordegree,andthepeckingorder–higherdegree,bachelordegree,diploma,certificateIII/IV-hasnotchanged.Thuswhileahigherdegree,forexample,maynotprovidethesamejobprospectsasitdidpreviously,it isstillrankswellaheadofanordinarydegree.Credentialismmayhaveoccurredbutthatisthelabourmarketinwhichyoungpeoplehavetocompete.Whilecredentialismmayreflectoverinvestmentineducationfromsociety’spointofview,itmaystillbeoptimalfromanindividual’sperspectivetoinvestinthatadditionalqualification,evenifemployersareseekinghigherqualificationsasasortingdeviceorbelievethatacademicstandardshavebeendeclining.Theotherpointtonotefromanindividual’sperspectiveisthatsomefieldshavebeenmoreaffectedthanothers.Inparticular,higherdegreesinbusiness and administrationhaveseenaverylargedeclineintheaveragequalityofjob.Finally,theanalysisbringshomethepointthatwhiletheaveragereturntoaqualificationmightbehigh,noteveryonewillgetthataverage;foranyparticularqualificationtherewillbeadistributionofjobsandsomewilldobetterthantheaverageandothersworse.

Theanalysiscouldbeextendedbybreakingdownthesupplysideintodomesticandforeignborngraduates,perhapssplittingthelatterintowhethertheycomefroma non-English speaking background or not. It may be the case, for example, that

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Australianborngraduateshavefaredbetterthanthosebornoverseas.OfparticularinterestwouldbetheroleinincreasingthesupplyofgraduatesofskilledmigrationandinternationalhighereducationstudentswhoremaininAustraliaaftergraduation.However,suchanalysisisbeyondthescopeofthispaper.

Fromgovernments’perspectivetheissuesarealittledifferent.Onthelabourdemandside,partofthestoryistheincreasedregulationofthelabourmarket.Degreesrather thandiplomas inhealth jobs (educationwent through thischangebefore thetime periodwe are considering), and the introduction ofmandatory credentials infinancialservicesandcommunityserviceshavenaturallybeenaddressedthroughanincreaseinpeopletraininginandobtainingthesecredentials.Whetherthishasledtoanimprovementinthequalityoftheseservicesisanimportantpolicyquestioninitsownright.However,onlypartof theexpansionintheproportionofpeoplewithqualifications can be attributed to regulatory changes. In unregulated parts of thelabourmarket,thequestioniswhethertheeducationalexpansion,or‘skillsdeepening’isprovidinganyrealbenefit(notingthatthebalancebetweenpublicandprivatebenefitsgoestotheissueofpublic/privatefinancingoftheexpansion).Onecanarguethatthe‘skillsdeepening’mightleadtoimprovedproductivitywithinoccupations;ifthisisthecasethenthedeclineintheaverage‘jobquality’asmeasuredbyoccupationwouldbelessofaconcern.However,theremustbeanaggingfeelingthatpartofwhatwehaveobservediscredentialism,withindividualsrequiringhigherlevelqualificationstoobtainajobinanoccupationwithoutanimpactonproductivity.Theuncappingofuniversityplacesoverrecentyearsimpliesthatincreasingeducationlevelswillbeafeatureoftheemerginglabourmarket,andthejobprospectsofnewhighereducationgraduates since 2008 have been worsening (Graduate Careers Australia, 2013).Whetherthisisacyclicalphenomenonorreflectslongertermstructuralchangeswillbecomeclearerwiththepassageoftime.ThematchbetweenthelabourmarketandeducationiscertainlyaconcernoftheOECD(2012),askinghowtheworldeconomiesaregoingtoabsorbtheincreasingnumberofwell-educatedyoungpeople.Ofcourse,if individualswerepaying for the full cost of qualifications then thatwouldbe anissueforprivateconcernbut theverysignificantpubliccontribution to thecostsofqualificationsmeansthenitmustbeapublicpolicyconcern.

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Ski l ls Deepening or Credential ism? Education Qualif ications and Occupational Outcomes, 1996-2011

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