A new salary metric is found in the trash

There’s not a lot that concerns higher education, almost certainly because there’s not a lot that the Westminster government does for HE other than poke blame at it for one or another of society’s ills.

But something ominous has appeared.

You will remember that Commission on Race and Ethnic Disparities that was headed up by Tony Sewell. The government response – Inclusive Britain – had a whole bunch of actions in it for all sorts of bits of the state and its arms.

Today, from the desk of Minister for Women and Equalities Kemi Badenoch, we got the second update report. It’s doubtful that there will be a third.

There’s bits and bobs in there. This academic year, there’s been an increase in the number of schools that the Apprenticeship Support and Knowledge (ASK) programme engages with that have high proportions of students from an ethnic minority background.

The Office for Students (OfS) has made over 80 funding awards to universities and colleges from the first 2 waves of the Degree Apprenticeship Development Fund, which will widen participation to under-represented and disadvantaged groups, “including through engagement with ethnic minority students.”

Access and participation plans are rolling in as we speak, UCAS’ student-facing version of the Historic Entry Grades tool has been launched, and to “protect applicants from ethnic minority backgrounds” from “bad” provision, that Rishi Sunak crackdown on low-value courses (the one that ‘s being implemented by OfS by using a felt mallet at a snail’s pace) is mentioned.

There’s even an amusing section where some poor civil servant has had to draft an update on Action 50, which was:

To help high-achieving, disadvantaged students to reach their full potential while studying in higher education, including degree courses or apprenticeships, the DfE will invest up to £75 million to deliver a state scholarship programme.

That found its way in in 2022 because DfE had to say something on student financial support in its Augar response – and so was copied across in this “anyone got anything we could chuck in” approach that many of these cross-government strategies seem to use.

It was a piffling amount then – but of course since has not actually emerged at all. In its place? Yep, it’s the return (and perhaps last appearance of) the magic money twig:

It is vitally important to support talented, disadvantaged students to succeed in higher education. We want to do this in the way that impacts those who will benefit most and achieve value for money. For example, the DfE has made £276 million of student premium funding available for the 2023 to 2024 academic year to support successful outcomes for disadvantaged students. The DfE will consider whether a scholarship scheme or other form of support will add significant value.

So what’s the actual interesting thing?

Inclusive Britain argued that employment opportunities and earnings potential play an important role in enabling social mobility – and so in February 2023, the Social Mobility Commission (SMC) published research on the Labour market value of higher and further education qualifications. It found that:

• Students from disadvantaged backgrounds are disproportionately less likely to attend universities or study subjects associated with higher earnings when compared to their wealthier peers with similar grades.
• Students with lower socio-economic status have less access to information about the earnings outcomes associated with specific courses.
• Information about who is enrolling in a degree – where they’re from and their background – is important to accurately understand prospective student’s future earnings.

Building on this work, the SMC is going to publish an accessible version of its Labour market value of higher and further education qualifications research “in due course” – with insights into the potential earnings associated with various higher and further education qualifications, categorised by subject and institution.

In 2025, the SMC will also publish a new set of benchmarks that looks at the extent to which universities are supporting social mobility. That will use recent data and take into account the differing academic requirements of more selective universities.

That doesn’t sound like the sort of thing that an incoming Labour government, if that’s what we’re getting, would abandon.

But more interestingly, building on the SMC’s research, the Department for Education (DfE) has apparently commissioned the Institute for Fiscal Studies (IFS) to develop a new way to “accurately and fairly” measure the impact that different higher education courses and providers have upon graduates’ future earnings.

And IFS is going to develop options for how this new “earnings metric” could be used in OfS’ regulatory approach – to “incentivise providers to improve or withdraw courses that offer poor salary outcomes”.

The good news is that unlike OfS’ B3 metrics, IFS has been asked to make sure that controls for students’ backgrounds to avoid unfairly penalising providers that admit students from disadvantaged backgrounds who may achieve poorer salary outcomes in the future for reasons beyond a provider’s control – which of course can include geographic, financial and cultural factors.

Tricky stuff, that – but if IFS can pull it off, it would at least neutralise some of the criticisms levelled at LEO data and the like.

It’s just that in the current iteration of OfS, it’s not clear where that would fit – it wouldn’t work as B3 metric, maybe it could end up in the TEF, or perhaps it will just sit somewhere on the website, hoping that a league table provider picks it up.

In the current iteration of OfS, that is. I suspect there will be some out in the sector hoping that if Labour win, we get a dialling down of “salary benefits to drive better choice in a market” malarkey – and there will be others pointing out that on that “improve or withdraw” courses decision, the danger is that providers reduce opportunities by opting for the latter, as has apparently happened following OfS’ publication of its inspection report into Computing provision at Bradford College.

But it’s hard to believe that a somewhat neutralised version of LEO will be ignored by a Labour government without money to spend on things.