Graduate Destinations ...
Is HE still worth it?
Gemma Ludgate
Head of C2 Education
The Careers Group
University of London
Today’s session
 Grad Vs Non-grad: earnings and employment
MOOCs
Loan system
Key factors
 HEI
 Subject
 Grade
Conclusions (?)
Resources
Grad Vs Non-Grad: Now
BIS Labour Force Survey: Q1 2014
 87.3% of young graduates are employed compared to only 62.1% of young
non-graduates.
 57.4% of young graduates are in high-skilled employment.
 86.7% of working-age graduates are employed compared to only 66.3% of
non-graduates.
 The median nominal salary of working-age graduates is £31,500, while the
median nominal salary of working-age non-graduates is £20,750.
 92.4% of graduates aged 25-30 are employed today, compared to 93.4% in
Q1 2008.
Grad Vs Non-Grad: Future
“Employers expect to hire 18% more
graduates in 2014, up 4.3% in 2013”
“Increased activity has failed to translate
into higher graduate starting salaries:
65% have not increased their rates for
2014”
“The stagnation of graduate salaries is
seen as an indication that the supply of
graduates remains high”
* 2014 annual report from Incomes Data Services
Grad Vs Non-Grad: Distant future?
“Many of the jobs expected to drive
economic growth in the future will not
necessarily require a traditional
academic pathway.”
“In 2022, the top three in-demand
occupations will all be in health and
care; nearly three million workers will be
required in hospitals, care homes and
the community”
*Commissioned by The Edge Foundation: ‘dedicated to
raising the status of technical, practical and vocational
learning’
Grad Vs Non-Grad: earnings
“Men with a degree earn 28
per cent more than those
without one, while for women
the differential is 53 per cent.”
“A degree will earn graduates
an extra £252,000 over their
lifetime for women and
£168,000 for men”
*BIS, The Impact of University Degrees on the
Lifecycle of Earnings: Some Further Analysis, August
2013
Postgrad premium
“There is a significant wage premium for those with postgraduate
qualifications. Somebody with a Master’s can on average expect to earn
£5,500 more a year – or £200,000 over a 40 year working life - than
someone only holding a Bachelor’s degree.”
“The overall wage premium for staying on in higher education after
acquisition of a first degree and obtaining postgraduate qualifications is
increasingly more lucrative over time.”
* The Sutton Trust, February 2013
MOOCS: A (free) alternative?
Student loans
"We estimate that 73% will
have some debt written off at
the end of the repayment
period, compared with 32%
under the old system. The
average amount written off will
be £30,000.“
“Due to above inflation interest
45% of graduates will pay back
more than they borrowed in
real terms”
*Institute for Fiscal Studies (IFS), April 2014
Other factors: HEI
Russell Group Vs non Russell Group (2011)
 Unemployment: 7.86% Vs 8.68%
 Average FT salary: £25,7k Vs £23,2k
Hussain et al (2009): the effects of HEI quality on
earnings is statistically significant, but small compared
to the overall return to higher education average –one
standard deviation in HEI quality results in a 6%
earnings
Other factors: subject choice
*The Complete Universities Guide
Other factors: degree result
 Grads who failed to get a 2,1 or
1st earn around £80,000 less
(over a lifetime)
 LSE, June 2013: those with 2,1 degrees earned
£2,000 more per year after graduation.
(Very!) Tentative conclusions
Graduate ‘premium’ exists
But ... Students should consider the status of the HEI,
the course they are thinking of and aim to get a 2,1
But ... A 2,1 isn’t enough on it’s own! Work
experience and extra-curricular stuff matters
... Make the most of uni careers services!
Final thoughts from the horse’s mouth
A May 2013 survey of 500 Fresher's (studentmoneysaver.com)
showed that:
 Although 58.4% felt their first year wasn’t worth the £9000,
86.2% would enrol into university if they had to make the choice
again
 84.4% would recommend university to someone considering it
 1.6 % expressed dissatisfaction with every aspect of their first
year
 20% of comments mentioned the university ‘experience’ as partjustification for the cost.
The Careers Group believes that all information provided in this publication is correct at the time of publication. Copyright © The Careers Group, University of London. 24 June 2013.
Useful resources
http://www.london.ac.uk/challenge.html
http://unistats.direct.gov.uk/
http://wlgd.thecareersgroup.co.uk/
www.prospects.ac.uk/
The Careers Group believes that all information provided in this publication is correct at the
time of publication. Copyright © The Careers Group, University of London.
References
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Loan repayments: www.bbc.co.uk/news/education-26954901
Postgraduate premium: www.suttontrust.com/public/documents/postgraduate-premium-report-1-.pdf
Graduate premium: www.timeshighereducation.co.uk/news/graduate-premium-is-nearer-200000-saysnew-report/2006574.article
Graduate premiums by subject: www.thecompleteuniversityguide.co.uk/careers/graduate-salaries-andthe-professional-premium/
Factors in earnings:
www.gov.uk/government/uploads/system/uploads/attachment_data/file/229498/bis-13-899-theimpact-of-university-degrees-on-the-lifecycle-of-earnings-further-analysis.pdf
Degree result and earnings: www.telegraph.co.uk/education/educationopinion/10098882/No-degreegrade-guarantees-you-a-good-or-bad-salary.html
Improving graduate jobs market for 2014: www.theguardian.com/money/2014/jun/02/uk-employers-tohire-18percent-more-graduates-2014
Potential rise in importance of vocational qualifications over academic pathways:
www.theguardian.com/education/2014/jun/04/vocational-education-image-vq-day-further-education
Graduate verses non-graduate employment now: www.gov.uk/government/publications/graduateemployment-figures-from-the-labour-force-survey-january-to-march-2014