askST: Does a degree equate to good jobs?

Graduates at the Singapore Management University's commencement ceremony in 2017. The annual graduate employment survey figures in Singapore show that university graduates have higher starting salaries than polytechnic graduates, and the gap widens o
Graduates at the Singapore Management University's commencement ceremony in 2017. The annual graduate employment survey figures in Singapore show that university graduates have higher starting salaries than polytechnic graduates, and the gap widens over the years.ST FILE PHOTO

Degree holders earn more now, but no guarantee this will continue in future

Q My parents want me to go to university because to them, a degree is the passport to good jobs and success in life. I am not as convinced, because the world is changing so fast. I know there is a difference between what degree and diploma holders earn when they start working. But does the difference remain? And do some degrees pay more than others?

A You are right in asking these questions. Many of your peers around the world are also questioning the worth of a university degree, partly because of the much higher costs of a degree education there and uneven job prospects for graduates.

But there is no doubt that those with university degrees earn more.

In fact, for Singapore, the highest percentage rise in wages goes with more years of education, according to a 2017 survey of 34 Organisation for Economic Cooperation and Development (OECD) economies.

Every additional three years of education translates into a more than 30 per cent increase in wages in Singapore.

The comparable OECD average is a wage hike of less than 15 per cent.

Also, the annual graduate employment survey figures released by universities and polytechnics in Singapore show that university graduates have higher starting salaries than polytechnic graduates, and the gap widens over the years.

Wages, of course, vary, depending on the industries you are going into and the demand for graduates from certain fields. Right now, there is high demand for those who have studied for degrees in artificial intelligence, data analytics and programming.

But this does not mean that university graduates will continue to earn more in the future.

Social economists Phillip Brown, Hugh Lauder and David Ashton, who wrote the book, The Global Auction: The Broken Promises Of Education, Jobs And Incomes, have argued that the conventional thinking that a degree equals higher earnings does not hold any more.

The authors surveyed businesses around the world and discovered that there was a global auction for high-skill, low-wage work.

Employees may want to increase the value of their labour and earn higher wages, but companies wanting to maximise profits aim to lower their labour costs. So, they will go where they can find workers with the skills they need, but who are prepared to accept more modest wages.

There is an explosion in the supply of university-educated workers in both affluent and emerging economies. In 2010, there were about 100 million graduates in the Chinese workforce. This year, this figure is expected to rise to 200 million. And there is similar dramatic growth in university graduate numbers in India.

The authors also warn of another trend called Digital Taylorism - where white-collar work is broken down, standardised and computerised such that it can be delivered by lower-skilled but cheaper workers.

Analysing X-rays, drawing up legal contracts and processing tax returns are examples of jobs that have been hit by this trend.

Job experts also warn of class distinctions among graduate workers that are emerging. At the top, there will be a cadre of thinkers and decision-makers - perhaps 10 per cent or 15 per cent of the total - but the mass of employees will perform routine functions for modest wages.

Those with elite qualifications are more likely to be made "thinkers", leaving those with "garden-variety" university degrees to be "doers", conclude the authors.

It is important that students, whether diploma holders or A-level school leavers, first figure out where their interests and talents lie.

 
 
 
 
 

And not all talents are best nurtured by immediately heading to university. Many would benefit from going out to work for a few years to hone their skills and understand the demands of the career they are interested in.

Then, when they enter university, they are able to make the most of their education to meet their career aims. And because they have picked a course based on their interest and talent, they are likely to do well.

Whatever further education paths you take, follow your passion, but also ask the hard questions. Think about why you want a degree and which courses or combination of courses will help you land the job you want.

I would also advise you not to think of university education as simply a meal ticket, but an opportunity for you to study the things that you find exciting.

You should get out of your comfort zone and open yourself to different opportunities and new things.

This way, you are more likely to not just end up with expertise in a particular area, but also with other skills that are important to have an edge and thrive in an uncertain environment.

A version of this article appeared in the print edition of The Straits Times on February 27, 2020, with the headline 'Does a degree equate to good jobs?'. Print Edition | Subscribe