February 14th, 2020
It’s often said that young people should be encouraged to follow their dreams and that as long as they work hard and apply themselves, they can achieve whatever they want. That much may be broadly true, however, a recent report has revealed that the reality can be greatly different to the ambitions of many students.
With student numbers steadily rising year-on-year since the early 2000’s, more and more young people have their sights set on a university education and a well-paying job off the back of it. This has led to a boom in student numbers, universities and the construction of private student rental property to meet this demand.
One trend that could be said to be distinctly of the 2010’s was the rise of newer, smaller universities offering more niche courses to their students in order to make headway in what was already a fairly crowded tertiary education market.
23 universities have been founded since 2010, with many of them providing a much more focused offering than the larger established higher education providers. For example, Leeds Arts University, established in 2017, caters purely to art students in a city that already has two world class universities.
This can only be considered a good thing as choice is increased for prospective students across the country, as well as better value for money across a wider choice of courses.
There is, however, a large disparity between what students would like to attain a career in, and where jobs are available across the economy.
A new report by Education and Employers has found “a disconnect between young people’s career aspirations and jobs in the UK, whether current vacancies or projected demand.”
According to the research, five times as many young people are aiming to work within art, culture, entertainment or sport compared to the amount of jobs available or the jobs that are projected to be required. This translated as 15.6% of 17-18-year olds seeking employment in those industries vs just a 3.3% economic demand. Concerningly, 51% said these were the only industries they were willing to work in.
The greatest shortfall in demand, it appears, is in accommodation and catering where they require almost seven times more students than are currently looking to enrol. That converts into 9.7% of the overall economy vs just 1.5% currently looking at careers. The situation is similar in wholesale and retail trade, with a 15.1% share of the economy vs just 2.6% interested in working in the sector.
The report summarises by recommending much greater careers education and guidance across all levels of education. It goes on to say, “From age seven, we need to ensure that children get to meet a range of people from different backgrounds and doing different jobs.”
There is also some suggestion that headway is already being made, especially if we consider the prominence of these new niche universities opening across the country, with another new university reportedly passing the planning stage in Peterborough this month.
As the student sector diversifies not just for universities themselves, but employers and investors, there is a clear representation of something we probably all suspected – trends are moving towards students picking much more specific courses at smaller universities.
What does this mean for investors? Well essentially that the future for great returns and yields will lie within the surrounding areas of these newer or more specialist institutions. Areas such as Middlesbrough, Leeds and York, where courses and establishments are set to cater for these students and tastes in the coming years.
We’ve written fairly extensively on the subject of location and, in comparison to residential property, these student properties represent a substantial prospect of not just low entry price, but high yields, allowing investors the ability to really diversify their portfolios across different areas and sectors.