University can be wonderful but it’s not for everyone
IT IS now so normal for school leavers to go into higher education that it is often difficult to remember how recent a phenomenon this is. In previous generations, a university education was the preserve of a small minority. Today, 49 per cent of people under 30 have been on some kind of advanced education course – with one in three 18-year-olds starting a degree course in 2017.
We are now almost at the level that Tony Blair floated in 2001 when he set in train the expansion in higher education, saying, “there is no greater ambition for Britain than to see a steadily rising proportion gain the huge benefits of a university education as school standards rise, meeting our goal of 50 per cent of young adults progressing to higher education”.
Even the rise in tuition fees in 2012 of up to £9,000 a year has not had the impact opponents feared. Far from being put off, the numbers continue to climb at a faster rate than the increase in the population.
A university education is a wonderful aspiration and we should celebrate the fact that so many school leavers now have the opportunity and motivation to get a degree.
But nothing is ever free in this world, and a university education costs a lot of money, both in student fees and taxpayer support. So we should always ask ourselves – both as a society and as those thinking about going to university – if it is necessarily the right option.
BECAUSE for all the massive expansion in universities and higher education, we still have a skills crisis that is deeply worrying for our economic prospects.
A recent study, for example, by the British Chambers of Commerce showed that 66 per cent of manufacturers looking to hire and 57 per cent of services exporters were unable to find the right staff. Far from the increase in higher education having closed the skills gap, it is still growing.
In focusing so much on degrees, we have failed to do enough to boost technical training and apprenticeships. In this context, a report out yesterday makes for important reading. It shows that between 18 and 25 per cent of graduates are studying for degrees that will not lead to earnings sufficient to offset the cost of their tuition fees.
The document was written by Neil O’Brien, a Tory MP, and Will Tanner, ex-deputy head of policy to Theresa May, for Onward, a Tory think-tank. But it’s not the political complexion of the authors that is of interest – it is the figures themselves.
They show that in 2015-16, 40 per cent of graduates had studied on a course where the average earnings five years after leaving college did not meet the student loan repayment floor of £25,000.
Putting all figures together, the report shows there are 134,000 students a year who will not be able to pay back a penny of their student loan even 10 years after graduation.
For example, 126,000 students started a creative arts course in 2016-17. But the average salary for such graduates a decade after leaving is just £23,200. In contrast, economics graduates averaged £48,000 a year a decade after graduation. The report shows that over a million graduates would have been better off doing a technical course or starting work, because they now have a large student debt they cannot repay – the result of a salary too low to meet the repayment threshold.
THE average debt from tuition fees and maintenance loans held by a student on graduation is about £50,000. Poorer students, who have less financial support from their family, owe even more.
This matters not just to the students concerned but to the taxpayer, because it is the taxpayer who carries the debt if a student doesn’t earn enough to pay it off. The Department for Education’s figures show that 83 per cent of all student loans will not be fully repaid before being written off after 30 years.
It is difficult to see how this makes sense for anyone except, you might think, the universities, which have been on an orgy of expansion in recent years. But even this side of the equation doesn’t add up. Over the past year, the level of university debt has risen to an astounding £10.8billion.
Last week it emerged that five universities, including Southampton, University College London and Imperial College London, more than doubled their borrowing over the past year as they built new campuses and expanded to try to win students.
Imperial alone owes £470million, paying for its expansion in White City and Kensington, along with other projects. UCL is spending £1.2billion refurbishing existing buildings and constructing a new 11-acre campus on the 2012 Olympic site.
You might well think this level of spending is crazy – and you would not be alone. Sir Michael Barber, head of the Office for Students watchdog, describes universities as behaving like over-confident banks before the financial crisis, believing they are “too big to fail”.
And university is simply not right for everyone. Dropout rates for students who give up their studies within 12 months are rising. In 2015, 26,000 students did not start the second year of their university course.
Part of the problem is that we have not bolstered the alternatives – technical courses and apprenticeships. It makes far more sense to expand these.
University should be a considered choice, with the options and consequences well thought through, rather than the default option it has now become.