Golo Henseke and Francis Green
The importance of higher education among the resident Singapore workforce has been increasing. Yet there are few studies that have considered the coevolution of higher education attainment in the workforce and the utilisation of graduate skills. To do so, we have drawn on the conceptual distinction between graduate jobs and non-graduate jobs. However, we have also explicitly recognised that there is considerable variation among graduate jobs. We distinguish further between ‘task-warranted’ and ‘task-unwarranted’ graduate jobs. In both types a degree is required to obtain these jobs, but in the former, task-warranted graduate jobs the job involves carrying out typical graduate-level tasks; while the latter require only low levels of graduate-level tasks. In task-unwarranted graduate jobs, employers still require a degree because it helps sort applicants for their hard-to observe skills – the logic that lies behind signalling and credentialism. To operationalise the distinction, and to analyse the Singapore graduate labour market, we use data on task use in two surveys, one in 2013 the other in 2017.
We find that the continued expansion of higher attainment in the resident workforce between 2013 and 2017 is met by a similarly-strong growth in graduate jobs over the period. This growth of graduate jobs can be fully explained by upskilling: an increasing use of graduate-level tasks within jobs. The share of task-warranted graduate jobs expanded sharply from 21% to 32% of jobs, while the share of task-unwarranted graduate jobs fell slightly. Despite these positive signs, it remains the case that about 1 in 3 employed graduates were in jobs that were on verage not making full use of graduate skills.
Complementing these trends in supply and demand, the pay premium associated with higher education remained stable and high: graduates’ pay was more than double that of secondary school leavers. Yet there is dispersion among graduates’ pay, and in particular a wage penalty of 35% for underemployed graduates in 2017. There was a much smaller wage penalty (16%) for being in an task-unwarranted graduate job as opposed to a task warranted graduate job. Neither of these had significantly changed from 2013. In both years attainment and utilisation of a degree is stratified by parents’ highest level of education. Given the very substantial pay premium, and the considerable pay penalty for underemployment, this stratification is likely to have adverse consequences for social mobility in Singapore.