UK labour market conditions are the key determinant of incentives to undertake postgraduate study for the home market. Here’s the latest ONS data on job vacancies in the UK.
Vacancies are now consistently falling from their (unprecedented this side of the millennium) high last year but nonetheless remain significantly elevated. There are currently 21% more vacancies than the 2015-2019 average and 78% more than the 2020 average.
HESA data showed a surge in PGT Home enrolments across the sector in 2020/21, as job vacancies plumetted, many were subject to furlough and anxieties about job security increased. Since then many institutions have experienced successive drops in PGT Home intake as labour market conditions have tightened.
Higher vacancies don’t just make it easier for the unemployed to secure a job, they also make it easier for those already employed to secure promotions and payrises (data also shows payrises are remaining strong). If you perceive your position in the job market to be strong, as it is for many people in the UK at the moment, you’re less likely to consider taking time out of earning to invest in further study.
Vacancies will likely continue to fall from here but UK-specific structural factors – namely Brexit and unusually high levels of long term illness – may prevent them from returning to the long term average for some time. If the Bank of England begins to loosen monetary policy next year, as has become more likely given better than expected inflation data released today, this may further slow the return to normality.
Even if vacancies return to near the 2015-2019 average by the start of the 2024/25 academic year, we should expect there to be a lag in this feeding through to prospective applicant perceptions. We should also expect that the elevated costs of postgraduate study compared to the 2015-2019 period (when postgraduate loans had been newly introduced, their value not yet eroded by inflation and sector-wide tuition fees were notably lower) will make it more difficult to achieve pre-pandemic levels of intake even when labour market conditions become similar.
The prospects for UK postgraduate student recruitment will improve in the medium term but we’re not out of the woods yet.