03The nature of the new graduate workforce
This final section looks at the characteristics of the new graduates’ labour market in Derby.
Half of new graduate workers in Derby came from elsewhere
Figure 19 brings together all graduates who decided to work in Derby on graduation to provide an overview of the nature of the graduate workforce in the city. 16 per cent of all workers were home-grown: growing up, studying and subsequently working in Derby. Almost a quarter of workers had come to study in Derby and stayed for work. Almost half of new graduate workers had been attracted in from elsewhere, the 24th highest among UK cities.
In terms of the class degree achieved, the composition of Derby’s graduate workforce is not dissimilar from the one of the UK as a whole. 15 per cent of graduates working in Derby had a first or upper second class degree from a Russell Group university; for the UK as whole the figure is 16 per cent. Meanwhile the city had a slightly higher share of non-Russell Group with a first or upper second class degree.
Graduate wages in Derby
Graduates working in Derby earned on average £24,100 a year, which is above the mean UK graduate wage of £ 23,100. Derby has the 7th highest graduate wages among UK cities and only graduates in Aberdeen, London, Slough, Newport, Worthing and Basildon have higher wages than of those in Derby, as shown in Figure 21. However, analysis of UK graduates finds that graduates’ wages were not the main reasons why graduates choose their employment location. Other factors such as the type of jobs available in that city and the opportunities for career progression were more important.4
In terms of institutions, Figure 22 shows that the average salary of a University of Nottingham graduate was higher than one from the University of Derby. Interestingly, students from the University of Nottingham who stayed to work in Derby earned more than those who left. In contrast, at the University of Derby, there were no considerable differences between the wages of those who worked in Derby and those who worked elsewhere.5
If we look at wages by sector, as shown in Figure 23, manufacturing was the sector with the highest average graduate wages. These are higher than the national average graduate wage for this industry, and the 4th highest among UK cities. Graduate wages in construction were slightly higher than the national average. However, average wages for those who worked in KIBS and other private services were lower than the average for the rest of the country.
The majority of graduates in Derby are in high-skilled jobs.
The type of jobs available to graduates in each location will be a major determinant of where they choose to work. Figure 24 shows that 79 per cent of new graduates in Derby were employed in high- skilled occupations; a higher proportion than for the UK as a whole and the 25th highest share of graduates in high-skilled occupations among UK cities. Swindon, with 82 per cent, had the highest share of graduates in high-skilled occupations. However, Derby’s share of new graduates in low-skilled jobs is higher than the UK average, and the 28th highest among UK cities. Oxford, with 6 per cent, had the lowest proportion of graduates in low-skilled jobs.
The share of graduates in Derby employed in manufacturing is four times the national average
Figure 25 shows that 20 per cent of all graduates working in Derby were employed in manufacturing. This is four times the UK average and the highest among UK cities. But the most popular employer of graduates in the city was the publicly-funded services sector; with the share of graduates in this sector the same as the UK average. At 9 per cent, the share working in private knowledge intensive business services (KIBS) was lower than the UK average.
Looking at a finer industrial breakdown shows that in the manufacturing sector, 23 per cent of all new graduates worked in the manufacture of transport equipment. In the publicly funded services, 21 per cent of all new graduates worked in health and 18 per cent in education. In the KIBS sector, 4 per cent of the city’s new graduate jobs were in architectural and engineering activities.
But different industries play different roles in attracting graduates into the city.
Where the new graduates working in Derby came from varied across industries. Those graduating from a Derby campus were likely to go on to work in education or health (combined figure for the two universities). Manufacturing, on the other hand, played a prominent role in attracting new graduates from elsewhere: 90 per cent of graduates working in the manufacture of transport equipment did not study in Derby, with 19 per cent coming from Sheffield. Similarly, only 13 per cent of new graduates employed in architectural and engineering activities were from a Derby university. This broader pull of the city’s manufacturing sector should be viewed as a positive as attracting graduates from elsewhere is an important contributor to the overall size of a city’s new graduate workforce.
Figure 26 shows that manufacturing also played an important role in attracting new graduates with the highest level of qualifications – 60 per cent of new graduates who moved to Derby for work with a First or Upper Second class Degree from a Russell Group University worked in manufacturing. KIBS jobs accounted for the second largest share of this cohort, but accounted for just a quarter of those going into manufacturing.
Figure 26: Share of new graduates with First and Upper Second class degree from a Russell group university, working in each sector, 2013/14 – 2014/15
If we look at where graduate jobs were located, D22 and D24 postcodes were home to 62 per cent of all new graduate jobs. D24, where Rolls- Royce and Bombardier are located, was home to 55 per cent of all new graduate private jobs, 46 per cent of all new graduate KIBS jobs and 80 per cent of all new graduate manufacturing jobs.
When we look at the sector breakdown of the Derby’s graduates who left after graduation, the majority were also employed in public funded services (Figure 26). 9 per cent of Derby’s new graduates who left to work elsewhere were employed in KIBS jobs, the same proportion as those who were employed in Derby. And just 6 per cent of those who left were employed in manufacturing.