Earnings and outcomes – is a degree worth it?

Our final UPP Foundation/Wonkhe Policy Forum of the year completed the student lifecycle journey with a fascinating panel debate on graduate outcomes and the ‘value’ of a degree, on June 14th at King’s College London

Our excellent panel, chaired once again by UPP Foundation’s Richard Brabner, featured:

• Professor Anna Vignoles, Professor of Education at Cambridge University
• Sonia Sodha, Chief Leader Writer at the Observer
• Maddalaine Ansell, Chief Executive of University Alliance
• Ant Bagshaw, Deputy Director at Wonkhe

The timing of the debate could not have been more apt, with Longitudinal Education Outcomes (LEO) graduate salary data released only the day before. Professor Vignoles was heavily involved in the first use of ‘linked’ data to research graduate salary outcomes last year.

Anna’s succinct answer to the question of whether a degree is worth it was: “yes, on average”. However, she pointed out how LEO shows that there is substantial variation in earnings outcomes for graduates, and whilst most will earn more than if they had not gone to university, there are some pockets of institutions and courses where this is not the case. Some subjects can also be called “riskier” bets than others, with wide variation in graduate earnings even from the same university. She also pointed out that the hierarchy of graduate earnings is as much determined by the hierarchy of school achievement, which in turn is heavily influenced by students’ class backgrounds. University graduate outcomes simply reflect the inequalities that already exist in wages and the labour market.

Sonia pointed out that there is growing pressure for the higher education sector to demonstrate that it is delivering good ‘value’ to the state and the Treasury. Universities, despite the introduction of fees, still receive substantial public subsidy, particularly compared to other parts of the education sector. But despite this generous public funding during a time of austerity, Sonia questioned whether there is strong enough evidence that universities are delivering ‘value’ for their students. She argued that greater transparency, particularly on the use of fee income, would be a good way forward, as is the introduction of graduate outcomes data such as LEO.  

Maddalaine was unequivocal in arguing that, yes, university is very much worth it. She focused her argument around the limited alternative routes through tertiary education into the labour market, particularly for those from working class backgrounds. Maddalaine voiced her concern that many politicians do not understand the work that universities, and in particularly modern universities, do to provide technical and general education that is relevant to the needs of local economies. Apprenticeships and other routes are not yet well developed enough to generally equate with the good work that universities do. In Maddalaine’s words, a degree is more than merely ‘valuable’, it is ‘priceless’.

Ant argued that LEO could provoke some serious questions in government about how a wide variety of salary outcomes carry an equal nominal ‘price tag’ in tuition fees. It will also force questions about those courses which, due to the nature of income contingent loans, receive (in effect) the most state subsidy. Ant pointed out that every single major political party manifesto promised either a major overhaul or a major review of higher education funding – there is widespread concern about the sustainability of the current system, and universities should get ready for any number of big changes ahead.

All in all, the question of the ‘value’ of degree spun out in many different directions during the course of the debate, considering the value that degrees provide for students, graduates, the Treasury, wider society, and employers. Panelists each had different perspectives on the extent to which a degree is worth its ‘cost’ (in England £9000 p/a), and whether it is worth the investment made by individuals and state in an income contingent loan system. So the question of whether degree is ‘worth it’ must necessarily be followed by – ‘for whom?’