New figures suggest that almost one-third of UK workers are either overeducated or undereducated for their jobs.
In a blow to hopes that the UK can lift its productivity growth out of the doldrums, data from the Office for National Statistics shows the proportion of workers “matched” to their job has dropped in recent years.
At 68.7% in the three months to December 2015, the percentage of those in employment with a level of education close to the average of their job was down compared with 69.9% two years earlier.
The ONS said one in six workers were overeducated, echoing other reports that skills are being wasted in UK workplaces. Previous figures from the ONS have highlighted the proportion of university graduates in non-degree level work such as bar-tending.
The latest news is not what the chancellor, George Osborne, will want to hear after independent forecasters cut the prospects for productivity growth. The Office for Budget Responsibility said that the gloomier economic outlook coupled with a shaky global economy meant UK growth would be 2% this year, down from its previous forecast of 2.4%.
The latest ONS figures showed a rise in the proportion of people overeducated for their job to 16.1%, up from 15.3% two years earlier. The proportion of people undereducated for their job, also a potential blow to productivity, rose to 15.1% from 14.8%.
Labour market expert John Philpott said this growing trend in underuse of talent should feature more highly in the post-budget debate on poor productivity growth.
“It’s clear from these estimates that the UK is underusing a lot of talent, with women and people in part-time jobs in particular employed in occupations for which they are overeducated,” said Philpott, director of the consultancy The Jobs Economist.
“While such a waste of available skill was understandable during the recession the generally upward trend toward increased overeducation since 2012 is worrying.”
The trend called for more efforts to increase demand for skills and promote better quality jobs, he added.
“The response should not be to cut the supply of high level skills to the labour market, for example, as advocated by commentators who think the UK is nowadays producing ‘too many graduates’.”