70,000 students a year worse off for getting a degree
MORE than 70,000 students every year would have been better off financially had they not gone to university, according to a report.
Analysis by the Institute for Fiscal Studies found that one in five people would have earned more if he or she had not gone into higher education.
Men who studied creative arts and social care subjects were the hardest hit, with many earning less than the average male who did not attend university.
Losses
On average women who went to university earned more than those who did not – although creative arts and social care subjects like psychology and sociology were again at the bottom of the earnings scale.
At the other end of the spectrum, men and women who studied medicine or economics earned the most.
The research revealed that going to university could lead to a net gain in lifetime earnings of an average of £100,000 – after tax and student loans were taken into account. Taking into account inflation and other factors, the earnings premium was £350,000 for men and £230,000 for women – an average of £8,000 a year for men and £5,000 a year for women.
The research was based on the Longitudinal Educational Outcomes data set produced by the Office for Students, the higher education regulator.
Ben Waltmann, co-author of the report and a research economist at IFS, said: “This analysis also shows that the Government makes an overall loss on financing the degrees of nearly half of all graduates.
“These losses are concentrated amongst those studying certain subjects. For creative arts, for example, the losses are substantial. This need not mean that the Government is misallocating funds, but it is important to be aware of the costs involved.”
Graduates in the top 10 per cent of returns earn an average of £500,000 extra over the course of their working lives, with medicine and law offering the best salaries.