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Graduate employability: A conceptual framework for understanding

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DOI: 10.1007/s10734-012-9556-x

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Graduate employability: a conceptual
framework for understanding employers’
perceptions

Yuzhuo Cai

Higher Education
The International Journal of Higher
Education Research

ISSN 0018-1560

High Educ
DOI 10.1007/s10734-012-9556-x

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High Educ
DOI 10.1007/s10734-012-9556-x

Graduate employability: a conceptual framework

for understanding employers’ perceptions

Yuzhuo Cai

 Springer Science+Business Media B.V. 2012

Abstract This study provides a conceptual framework for understanding what employers
think about the value of graduates with similar educational credentials in the workplace
(their employability), using insights from the new institutionalism. In this framework, the
development of employers’ beliefs about graduates’ employability is broken into a number
of factors and mechanisms, including exogenous factors, initial signalling effects and the
processes of both private and public learning. With such conceptualisation, this article
discusses the implications for international higher education providers on how to improve
their graduates’ employment by influencing employers’ beliefs.

Keywords Higher education
International education
Employers’ beliefs

Employability
Institutional theory

Introduction

One of the basic functions of education is to cultivate people to meet the needs of the
labour market. Since the 1960s, a considerable number of studies have been published that
describe the relationships between education and employment, often with reference to
either the concept of human capital (Becker 1964; Schultz 1961) or screening models
(Spence 1973; Stiglitz 1975; Arrow 1973). Most of these studies take the first employment
after graduation as the point of observation. However, research attention was not paid to
the processes of transition from education to work place until the 1990s, when the career
success of graduates started to be used as a key indicator to measure the quality of
education in general, and higher education in particular (Teichler 2009, p. 15). Since then,
universities and students have tended to become more responsive to the needs of the
employment system in their educational provisions and learning activities, but the needs
are often unclear due to growing uncertainties in the labour market, considerable erosion of
traditional occupations and employment conditions, and the rapid obsolescence of

Y. Cai (&)
Higher Education Group, School of Management, University of Tampere, Tampere, Finland
e-mail: yuzhuo.cai@uta.fi

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knowledge (Schomburg and Teichler 2006, p. 4). To respond to this challenge, more
studies have started to take account of employers’ views for identifying what higher
education should be providing. However, the results are diverse and even controversial.
For instance, as discovered by Teichler (2009, p. 11), employers have changing perceptions
of workers with similar educational qualifications, and their views vary according to their
different traditions, political biases and other factors. The inconsistency of these empirical
findings is arguably due to a lack of appropriate conceptual or theoretical frameworks,
within which different empirical observations can be embraced.
Among many issues in the research of transition from higher education to the world of
work, an important topic is concerned with how the potential of degree holders are per-
ceived by employers. One theoretical approach to this subject has been developed by
Bailly (2008). He reinterprets Spence’s (1973) signalling model as a trial and error process,
in which employers develop their beliefs on educational output through learning from the
real performance of recruited employees who hold certain educational credentials. One key
aspect of educational output is concerned with graduates’ employability. Yorke (2004,
p. 8) defines employability as ‘‘a set of achievements—skills, understandings and personal
attributes—that make graduates more likely to gain employment and be successful in their
chosen occupations, which benefits themselves, the workforce, the community and the
economy’’. The author of the current paper also applied Bailly’s model in order to analyse
the employment prospects of international graduates from Finnish higher education from
the employers’ perspectives (see Cai 2012). However, when undertaking that research, the
author realised that the Bailly’s principal focus was on individual employers’ learning
experience, without taking into consideration the dynamic aspects of social learning and
other exogenous factors. The current article expands on Bailly’s conceptual framework for
understanding employers’ beliefs about educational output by using insights from the new
institutionalism.
Despite its generic feature, the new framework developed in this study could be
expected to be especially useful for understanding employers’ perceptions of international
education output. The transition of graduates from universities to labour markets in cross-
border contexts is more complex than considerations of the domestic environment and
requires additional inclusive theoretical understandings of the nature of the process. In this
regard, this study is also an effort to engage in an under-researched area dealing with the
connection between students’ international experience and graduate employability
(Crossman and Clarke 2010, p. 600). The framework can also serve as a tool that helps the
stakeholders of higher education to identify key measures to improve graduates’
employment through influencing employers’ beliefs. Here, special attention has been given
to the implications for international higher education providers.

Human capital and signalling theories and the relationship between educational
attainment and labour market outcomes

With respect to the relationship between educational attainment and labour market out-
comes, the majority of studies tend to apply either human capital theory (Schultz 1961;
Becker 1964) or job market signalling (screening) theory (Stiglitz 1975; Arrow 1973;
Spence 1973). Although both theories imply a positive relationship between investments in
education and labour market returns, their explanations differ on how the mechanisms
concerning education affect employment.

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The human capital theory (Schultz 1961; Becker 1964) argues that education increases
individuals’ productivity, which consequently enhances job performance. As such, edu-
cation provides marketable skills and abilities relevant to job performance, and thus the
more highly educated people are, the more successful they will be in labour markets in
terms of both incomes and work opportunities. To understand the differences between
foreign and domestic education better, a division between country specific and general
human capital has been made (Chiswick and Miller 2003; Duvander 2001; Wiers-Jenssen
2008). Country specific human capital theory assumes that certain aspects of human capital
such as ‘‘language skills, cultural skills, and professional skills adapted to national
requirements’’ (Wiers-Jenssen 2008, p. 106; Støren and Wiers-Jenssen 2010, p. 31), often
acquired when studying abroad, are more useful in some labour markets than others.
A range of investigations have suggested that the international education experience can
improve graduates’ labour market returns in both the host countries (Chiswick and Miller
1995; Baker and Benjamin 1994; Krahn et al. 2000; Borjas 1995; Bratsberg and Ragan Jr.
2002; Zeng and Xie 2004) and the graduates’ home countries (Blaug et al. 1969; Pang and
Clark 1970; Demetriades and Psacharopoulos 1979; Mohajeri Norris and Gillespie 2009).
While the human capital theory has become a popular explanatory tool for the relationship
between education attainment and labour market outcomes, it has received criticism too.
The human capital hypothesis is based on perfect foresight, meaning that the employers are
able to make an objective and rational evaluation of the employees’ or job-seekers’ ability.
However, the situations in labour markets are often associated with uncertainties, including
imperfect knowledge of individual characteristics, uncertainty of the quality of schooling,
and imperfect knowledge of future demand and supply conditions (Levhari and Weiss
1974).
Unlike human capital theory, job market signalling theory (Stiglitz 1975; Arrow 1973;
Spence 1973) deals with principal-agent relationships where asymmetries of information
exist and are not easily resolved. It is based on the premise that hiring is an investment
decision for employers. Employers have to make recruitment decisions in conditions of
uncertainty. When making decisions, employers take into account signals, for instance,
conveyed by levels of educational attainment. In some places, signalling theory is called
screening theory, but the core ideas are the same: job seekers send signals about their
ability level to employers by acquiring certain educational credentials, while employers
screen the job applications according to the signals that the educational credentials
transmit. Therefore, educational credentials become a kind of surrogate measure of quality
or ability. In this light, education only serves as a tool for job-seekers to signal their
inherent ability to employers. In other words, it is innate ability, not the education itself,
that increases productivity. Few studies have dealt with screening/signalling of interna-
tional education in the labour markets. In her investigation of the early career of
Norwegian graduates, Wiers-Jenssen (2008) discussed the signalling effects of foreign
education by arguing that a foreign education experience generally signals certain country
specific skills and characteristics of job seekers to employers. She also asserts that foreign
education’s signalling effect is weak if it is less known by the employers.

Bailly’s model of employers’ beliefs

Although both human capital and job-signalling theories seem to verify the intuition that
schooling has a positive effect on individuals’ labour market outcomes, it remains unclear
what really matters in the processes of employers’ recruitment decisions. There has been a

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long debate about the results of many empirical studies on what mechanisms (human
capital or signal) work in practice (Kjelland 2008, pp. 71–73). Moreover, the studies
applying either human capital theory or signalling theory mainly investigate the rela-
tionship between education and salary with little attention to employers’ perceptions.
When it comes to the transition from education to the work place, employers’ perspectives
are crucial. Many studies (e.g., Bremer 1998; Bikson et al. 2003; Thompson 2004; Garam
2005; Hermans 2007; Crossman and Clarke 2010) exploring employers’ views on the
relevance of international education experience to work focus mainly on the expected skills
that individuals gain from their education. In this regard, they have not gone beyond either
a human capital or signalling hypothesis, seeing educational output as a substance that can
be identified and measured objectively. In contrast, Bailly (2008) takes a ‘‘non-substan-
tialist’’ approach to conceptualise educational output with a strong emphasis on employers’
beliefs. To him, educational output instead of being a substance is susceptible to multiple
interpretations. As he states,
One of the consequences of emphasising the role of beliefs is that educational output,
as one element in that environment, no longer has the characteristics of a substance.
Rather, it becomes dependent on economic agents’ beliefs and representations and on
the (potentially multiple) evaluations to which they give rise. Educational output is,
in this conception, what economic agents evaluate as such.
According to human capital theory and signalling theory, both regarded as a substantialist
approach by Bailly, the importance of education in labour market outcomes is that it either
increases the students’ productivity-enhancement skills or signals the graduates’ innate
abilities to employers. However, Bailly argues that the validity of both human capital and
signalling hypotheses depends on the employers’ belief systems. His conceptualisation
corroborates social and cognitive psychologists’ argument that individuals use schemas,
frames, cognitive frameworks or belief systems to select and process information (Simon
1957). As belief systems become part of individuals’ unconscious and as these belief
systems control that unconscious, they also govern employers’ decisions on employment.
Accordingly, Bailly describes the development of employers’ belief systems in three
sequential stages. In the first stage (Fig. 1), an employer has no experience of hiring job
applicants with certain types of education credentials. The employer makes recruitment
decisions based on his/her initial beliefs about the applicants, or ‘‘conditional probabilistic
beliefs’’ in Spence’s (1973, p. 359) term. Specifically, the employer tends to attribute an
anticipated level of productivity to these people depending on the information transmitted
by job-applicants’ educational credentials, and then makes recruitment decisions based on
that. The information conveyed by the educational credentials can be understood as initial
signals.
The second stage (Fig. 2) commences when the applicants are recruited. When the
employer has more experience of hiring certain educational credential holders, the initial
signal effects tend to become less influential. By observing the quality of these recruited
employees, the employer’s initial beliefs are adjusted. If the employees’ performance is the

An employer’s
Decision making
Initial signals initial beliefs on
on recruitment
educational output

Fig. 1 Development of an employer’s beliefs: stage I

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Intended and
An employers’ Decisions on unintended
adjusted beliefs recruitment performance of
employees at work

Self-confirmation or
correction through trial
and error proecess

Fig. 2 Development of an employer’s beliefs: stage II

same as assumed by the employer before the recruitment, the employer’s beliefs will be
self-confirmed. Otherwise, the employer will correct his beliefs. ‘‘When he next comes to
recruit, an employer will rely on his (new) beliefs, which he will adjust again depending on
the difference in productivity observed after recruitment’’ (Bailly 2008, p. 962). The third
stage can be found when the process continues until equilibrium is reached. That means the
employer, through these successive learning processes, has accumulated enough experi-
ence to discover the candidates’ ‘true’ value.
It is worth mentioning that some other studies (Farber and Gibbons 1996; Altonji and
Pierret 2001) have developed similar conceptualisations to Bailly’s, which distinguish the
initial information about a worker’s ability signalled by his/her education and an employer
learning from subsequent observations of the worker’s output, deriving from the same root
of Spence’s (1973) model. In Bailly’s model, employers’ beliefs are forged through a trial
and error process. Farber and Gibbons (1996, p. 1008) have named such processes ‘‘private
learning’’. In addition, they state that the employee’s performance outcomes are observed
not only by their current employers but also by all market participants in the form of
‘‘public learning’’. Both public and private learning processes explain how the signalling
effects from the educational credentials can be developed with labour market experience.
These processes are set out in Fig. 3. This framework has expanded Bailly’s (2008) model,
but it still suffers from several limitations. First, it remains a ‘black box’ on how the initial
signals are developed and perceived by the employers. Second, it does not theoretically
explain the mechanisms underlying the public learning process. Third, it is unclear whether
there are other factors possibly affecting the employers’ beliefs. These gaps are expected to
be filled in with the insights of institutional theory.

Public learning

Employers’ Decisions on Performance

Initial signals
beliefs recruitment outcomes

Private learning

Fig. 3 Public and private learning processes

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Understanding employers’ beliefs from the perspective of institutional theory

I have paid particular attention to Bailly (2008), because his position that employers make
recruitment decisions based on their belief systems reflects one of the central ideas of the
new institutionalism (Meyer and Rowan 1977; DiMaggio and Powell 1983), holding that
human actions are driven by institutions. Institutions can be generally understood as social
orders (Berger and Luckmann 1967), social rules (Burns and Flam 1987), or taken-for-
granted norms and beliefs (Scott 2001), which are seen by actors as natural, rightful,
expected, and legitimate. In other words, they are institutionalised beliefs and practices.
However, Bailly’s model offers a limited understanding of the institutionalisation of shared
beliefs among employers, and neglects the dynamic aspects of other social institutions and
exogenous factors. By identifying the limits of Baily’s model, this author suggests an
extension to Bailly’s conceptualisation in this section to a more comprehensive framework
for understanding how employers make decisions on recruitment based on their beliefs,
using insights from the new institutionalism.

Definitions of actors and institutions

Institutional theory has become a popular and powerful explanatory tool for actions of both
individual and collective actors (Dacin et al. 2002, p. 45). It mainly stresses the depen-
dency of actors’ actions on institutions, such as wider environmental contexts, rules and
norms (Meyer et al. 2007, p. 188). Actors can be individuals, groups, organisations and
communities (Burns and Flam 1987, p. 2). Among those actors, the individual ones are
important subjects, because ‘‘[o]utcomes at the system level are thought to be determined
by the interactions of individuals acting consistently in terms of the axioms of individual
behaviour’’ (March and Olsen 1989, p. 5). In this study, the actors are employers, defined
as ‘‘those responsible for recruitment in employing organisations effectively act[ing] as
gatekeeper to the labour market’’ (Maguire 1992, p. 80). Their attitudes towards job-
seekers are crucial in the final recruitment decisions.
Scott (2008, p. 61) distinguishes institutions by ‘‘three pillars’’, namely regulative,
normative and cultural-cognitive elements. The regulative processes involve the capacity
to establish rules and the power to exercise control over the conformity of others to the
rules. The central ingredients of regulative institutions are force, fear and expedience
tempered by the existence of rules. In the normative pillar, social obligation is central to
social life, and the building blocks are values and norms which form the basis of social
obligation. Values can be interpreted as what people think to be important or right. Norms
derived from values directly influence people’s actions by specifying how people are
supposed to behave. The cultural-cognitive pillar emphasises basic assumptions, which
determine how realities are perceived and how things should be done. These assumptions
are so taken for granted that, within the cultural unit, other types of behaviour are
inconceivable. Thus, the basic building blocks in cultural-cognitive systems are meanings
and common frameworks of references.
Bailly’s (2008) conceptualisation of employers’ beliefs on educational output focuses
primarily on the individuals’ cognitive frames and also to some extent their shared norms.
According to him, how employers make decisions on recruitment is based on their beliefs,
which ‘‘enable economic agents to evaluate their environment, that is to give it a meaning
and thus reduce uncertainty’’ (Bailly 2008, p. 963). Such understanding shares similar
ontological assumptions to those theorists emphasising the cognitive pillar of institutions
that the reality is subject to the actor’s subjective views, and the actor’s choice is oriented

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by the ways in which knowledge is constructed. In Scott’s (2008, p. 57) words, ‘‘to
understand or explain any action, the analysis must take into account not only the objective
conditions, but actor’s subjective interpretation of them’’. Employers’ beliefs are their
cognitive frames, which ‘‘enter into the full range of information-processing activities,
from determining what information will receive attention, how it will be encoded, how it
will be retained, retrieved, and organised into memory, to how it will be interpreted, thus
affecting evaluations, judgements, predictions, and inferences’’ (Scott 2008, p. 57).

Interactions between employers and institutions

According to institutionalism, individuals’ internal interpretive processes or private beliefs

are shaped by external institutional frameworks, in which the three pillars of institutions
are intertwined. The development of employers’ beliefs as well as external institutional
frameworks can be respectively explained by ‘‘actor structuring’’ and ‘‘system structur-
ing’’, the concepts developed in Burns and Flam’s (1987) book—The Shaping of Social
Organisation: Social Rule System Theory with Applications. Social rule theory is funda-
mentally an institutionalist approach to the social sciences, both in its placing of primacy
on institutions and in its use of sets of rules to define concepts in social theory.
In their theorisation of actor-system dynamics, Burns and Flam (1987, pp. 2–3) identify
three levels of a social systems: ‘‘(1) actors, their roles and positions; (2) social action and
interaction settings and processes; and (3) endogenous constraints: material, institutional
and cultural’’. All these elements and their interrelationships are captured by two loops,
namely actor structuring and system structuring. With respect to the development of
employers’ beliefs, actor structuring is comparable to the process of private learning, with
public learning being a part of system structuring. The other element in system structuring
is concerned with the formation of initial signals transmitted by education credentials.
Burns and Flam (1987, pp. 2–3) also argue that some exogenous factors conditionally
structure actors’ behaviour, social action and system development. These factors are called
exogenous because they are not influenced by the actors themselves and their social
actions. The possible exogenous factors affecting employers’ beliefs can be, for instance,
the larger cultural environment faced by employers, specific market conditions and the
companies’ particular characteristics. All the factors and mechanisms affecting employers’
belief systems can be described in the Fig. 4.

System structuring

While private learning (actor structuring) has been discussed earlier in Bailly’s model, the
discussion here focuses on system structuring. From the perspective of institutionalism,
employers’ beliefs are developed within institutional frameworks. What affects the crea-
tion of an institutional framework is a process of system structuring. Compared to actor
structuring, system structuring takes a longer time. It takes place at the level of an entire
group, or in an organisational field. An organisational field is defined as ‘‘those organi-
sations that, in the aggregate, constitute a recognised area of institutional life’’ (DiMaggio
and Powell 1983, p. 148). For instance, a job market for international graduates in a
national context can be seen as an organisational field, including employing organisations
and other stakeholders. Burns and Flam (1987, p. 7) state that ‘‘social action and its
outcomes may be directed toward maintaining, modifying or transforming norms, insti-
tutions, and socio-cultural elements’’. This structuring of social system represents a process
of institutionalisation. It occurs through interaction and information exchange, generating

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Exogenous factors

Formation of initial signals

System structuring

Public learning
System structuring

Employers’ belief Decisions on Performance

systems recruitment outcomes

Private learning
Actor structuring

Fig. 4 Factors and mechanisms affecting employers’ beliefs

structures of prestige and dominated by certain organisations and shared norm and practice
within an organisational field (DiMaggio and Powell 1983, p. 148).
DiMaggio and Powell (1983) find institutionalisation is characterised by isomorphism
and they identified three mechanisms of institutional isomorphism, namely coercive,
mimetic and normative. Coercive isomorphism stems from political influence and the need
for legitimacy. Mimetic isomorphism occurs when actors face uncertainty and try to
emulate successful organisations as a solution. Normative isomorphism arises primarily
from professionalisation. Professionalisation involves two aspects: one is the homogenis-
ing influence of established norms, and the other is the growth and elaboration of pro-
fessional networks.
To specify how institutions are created, Scott (2008, p. 95) distinguishes between two
perspectives, naturalist and agent-based. From a naturalist perspective, ‘‘institu-
tions…emerge from the collective sense-making and problem-solving behaviour of actors
confronting similar situations’’. By agent-based accounts, institutions are created by the
purposeful actions of interest-based actors. In the process of system structuring, both
models might exist, in that the institutionalisation can be the result of either purposeful
actions of social agents or an unintended consequence of human activities.

Public learning

When some employers start to hire international graduates with similar educational
credentials, the performance outcomes of the employees will become benchmarks for the
employers to adjust their beliefs. This has been described as a process of private learning.
The consequences of private learning can also have an impact on the reproduction of
institutions in the organisational field through public learning. For instance, some
employers may imitate other companies that have been successful in recruiting interna-
tional graduates in terms of enhancing productivity. As such, the collective sense-making

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is developed through mimetic learning. According to DiMaggio and Powell (1983), the
extent of mimetic isomorphic effects on an organisation depends on the degree of
uncertainty and ambiguity of its goals. As international job markets often feature uncer-
tainties, the employers are likely to imitate or learn from those who have had successful
recruitment experiences. Within an organisational field, some other actors may facilitate
the public learning process by creating opportunities for information sharing among the
employers or directly disseminating information concerning the performance of the
international graduates at work places among actors in the field.

Formation of initial signals

Some initial signals exist, before either private or public learning processes. Where do
these signals come from? How do the employers perceive these signals? Such signals
are also developed within the institutional framework through a process of system
structuring but with different actors and mechanisms involved. The system structuration
related to the development of initial signals can be seen in the form of normative
isomorphism. While mimetic isomorphism occurs when actors are unclear on what to
do and therefore copy successful organisations, normative isomorphism arises when
professions feel capable of mapping their own policy but do so based on their soci-
alisation of dominant norms (Levy 2006, p. 145). If the employers in the organisational
field are connected through professional networks, certain norms on the values of
international graduates will possibly develop in a naturalistic way through their net-
works and professionalisation.
The normative isomorphism concerning initial signals can also take place in an agent-
based model. From an agent-based perspective, institutions can be created by the pur-
poseful actions of interest-based actors (Scott 2008, p. 95). Some studies (Cai 2010, p. 232;
Chien 2008), suggest that isomorphism takes place through consultancy involvement, in
which actors make similar decisions when they are guided by the same professional
consultancies. If there are some individuals and organisations that engage these consult-
ancies when employers make recruitment decisions, then consultant information can yield
certain signals to the employers. In other words, the consultancy organisations can be the
agents that create institutional norms.
In an extreme form of the agent-based model, agents can be understood as institutional
entrepreneurs. DiMaggio (1988) introduced the idea of institutional entrepreneurship,
whereby agents deploy the resources at their disposal to create and empower institutions.
Institutional entrepreneurs serve as agents of legitimacy supporting the creation of
institutions that they deem to be appropriate and aligned with their interests. These agents
have the resources and hence the power to shape the character of institutions and
institutional change. What underlies such institutionalisation processes is normally
associated with a coercive mechanism. Coercive isomorphism results from the influence
of other organisations on which an organisation is dependent, and from the expectations
of the social surroundings where the organisation is embedded. The chief coercive force
includes a legal environment, governmental mandates and funding. The extent of the
structural impact on an organisation depends on the resources received from other
powerful or central organisations (DiMaggio and Powell 1983). Usually employers in the
private sector are unlikely to be dependent on public authorities and public funding.
Nevertheless, some agents, such as governmental and professional organisations could
intentionally set out rules or disseminate information that might gradually formulate
institutionalised rules in the field.

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Conclusions: implications for international higher education providers

By knowing the factors and mechanisms affecting employers’ perceptions of employ-

ability, international higher education providers can hopefully develop relevant strategies
to promote their graduates’ future employment. As indicated by the private learning
mechanism, what eventually shapes employers’ beliefs on educational output lies in a
graduate’s actual productivity and performance at his or her workplace. Therefore, students
must be aware that gaining an international education diploma without actually increasing
their relevant knowledge and skills will not make them more successful in the labour
market. Universities should provide support for their students’ preparation for the work-
force, with special attention to the relevance of their education programmes to the labour
market’s needs and the quality of the graduates. The skills to be developed during studying
abroad normally include ‘‘a deeper understanding and respect for global issues’’, ‘‘more
favourable attitudes toward other cultures’’, ‘‘stronger intercultural communication skills’’,
‘‘improved personal and professional self-image’’, ‘‘better foreign language skills’’, ‘‘self-
confidence’’, ‘‘ability to handle ambiguity’’, ‘‘insight into their own value systems’’ and
‘‘overall maturity’’ (Salisbury et al. 2009, p. 120).
However, having these skills does not always guarantee the graduates’ success in the
labour market and this has often been neglected by universities. In particular, when the
graduate-producing institutions and the labour market are in different countries, it is
essential that the employers believe in the quality of the graduates (Wiers-Jenssen 2008).
Many higher education studies dealing with employers’ beliefs (as well as demands and
satisfactions) of graduates, have tried to come up with suggestions on how universities
could meet the employers’ needs, while little appears to have been written about how to
change employers’ beliefs. According to the conceptual framework constructed in this
study, some purposeful actions can influence the employers’ beliefs, both in shaping the
initial signals and in facilitating the public learning process. For each end, universities need
to have close interaction with employers and to get involved in a range of employers’
networks. This is corroborated by those (Reeve and Gallacher 2005; Hall and Thomas
2005) who propose an enhanced partnership or enhanced dialogue between higher edu-
cation providers and employers, especially in terms of informing the nature of the higher
education qualifications offered and shaping the legitimate expectations of employers.
To improve the initial signalling effects of their qualifications in the international labour
market, universities need to let employers know more about their curriculum, students, and
quality of the education they provide. In so doing, employers should be invited to par-
ticipate in reviewing and the subsequent development of curricula as well as teaching, and
by providing internship places for students. Moreover, university career services’ efforts
should be directed not only towards their students but also in a way to the employers.
Through consultancy engagement, universities can become active in creating shared norms
among employers on the value of qualifications from international education.
Public learning occurs when an employee’s characteristics and performance outcomes
are not only evaluated by the current employer, but are also observed by other participants
in the field. If employers in an organisational field are isolated from each other, it is
unlikely that they will be able to know how the workers perform in other companies. When
the employers have close connections through social and professional networks, there are
more options for them to share this kind of information. Universities should get involved in
these networks and play an influencing role there. For instance, some researchers and
organisations in higher education should study the successful cases of their graduates in
employment and disseminate the reports among targeted employer groups.

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This study provides a few examples of how proactive interaction can be developed
between universities and employers. It seems that these suggestions can be easily carried
out. However, there are great challenges in large-scale implementation. First, as the uni-
versities and employers have different interests and incentives, the dialogue and partner-
ship building process is unlikely to be an easy one. Second, for universities to carry out the
suggested actions will require investment from them, which is often beyond institutional
financial capacity. Third, in some countries the culture and priority might impinge on
attempts to build a dialogue between the two sides. To a large extent, the eventual
achievement depends on how policy makers and university leaders acknowledge the
important role of employers’ beliefs about educational outputs and their understanding of
the mechanisms underlying the maturation of employers’ beliefs.
As a final point, it should be noted that the conceptual framework contributed here is
still at an early stage of developing a theoretical model. In order to develop specific
statements about the relationships between variables, the framework needs to be further
examined in specific contexts and verified by empirical data.

References

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