The financial value of a university degree depends heavily on the subject chosen, with medics set to earn up to £400,000 more over a lifetime than non-graduates, while students of creative arts, philosophy or languages may see little or negative return.
Research by the Institute for Fiscal Studies (IFS), analysing a cohort of students born in the mid-1980s who took GCSEs in 2002, found that medicine offers the highest lifetime premium. Economics graduates also fare well, but other subjects offer little financial benefit when compared with the earnings of similar people without degrees.
“Medicine graduates can earn up to £400,000 more over a lifetime, but a quarter of graduates are financially worse off.”
On average, a graduate earns around £100,000 more over their lifetime after taxes and student loan repayments. But the data suggests a quarter of graduates can expect to be financially worse off as a result of going to university. One in ten male graduates will potentially be more than £90,000 worse off than they otherwise would have been.
The Department for Education (DfE) says it will cap numbers on courses with the poorest returns and will consult on introducing minimum English language requirements for prospective undergraduates seeking student finance. The government has outlined plans to limit the growth of some courses where there are consistently “poor returns for students,” the DfE said.
Minister for Skills Jacqui Smith urged students to “choose carefully”. “Don’t walk into a degree by default,” she said.
The latest DfE data, covering the 2022-23 tax year, shows that students who continued in education post-16 but had relatively low GCSE grades can expect lifetime take-home pay £53,000 higher on average than peers with similar grades who did not attend university. However, among graduate men with low prior attainment, around four in ten can expect to be worse off financially than if they had not gone to university.