No matter how many times Bob Birrell updates his argument that we need more graduates, he gets lots of publicity. This morning was no exception. According to The Age

THE Federal Government should massively increase university places rather than offer 450,000 new training places if it wants to equip young Australians with the skills needed in future, a Monash University study has argued.

Similar stories appeared in the SMH and The Australian.

The basic argument goes like this: there is strong employment growth in managerial, professional and associate professional occupations. However, growth in university commencements has been much lower, and even fell in a few disciplines between 2002 and 2006. Employers have had to use migrants to fill vacancies. Therefore we need more graduates.

However, on closer examination of the evidence the argument falls apart. Of these three broad occupational groups, only professionals are truly dominated by graduates. As I noted in my paper on this issue last year (pdf), only about 20% of associate professionals have degrees. Indeed, the category has now been abolished by the ABS and the occupations that it used to cover distributed to other broad groups. Some of them have gone to ‘professionals’ and ‘managers’, but most went to occupations that do not normally require degrees.

Similarly, ABS Education and Work 2007 shows that less than a third of managers have degrees. Presumably many of them are in small businesses. Perhaps they would be better managers if they had degrees. But we cannot assume that a growth in managerial positions will require an equivalent number of graduates. Even among professionals, 30% don’t have degrees.
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