The Social Mobility Commission has published (February 2023) an analysis of the types of courses that tend to mean students will earn more in their life than those who did not take such courses and those courses that do not increase or actually lower your chances of earning more.
The full article is here.
This data has been available for some years and is based on the Longitudinal Educational Outcomes dataset which combines school exam grades (the National Pupil Database), post-school education (the Higher Education Statistics Agency for universities and the Individualised Learner Record on students in FE colleges) and earnings (from tax returns).
The data only covers pupils born from 1986 so we do not yet know the full lifetime earnings outcomes of individuals who study a given qualification or subject.
On average, those who study qualifications in higher education (HE) or further education (FE) earn more compared to those who do not. At the age of 29, men who attend HE tend to earn 25% more than those with 5 GCSEs (A* to C grades) but who did not go to university. For women, attending HE is associated with 50% higher earnings.
In HE, there is a lot of variation in value-add across subjects, with Science, Technology, Engineering and Maths (STEM) subjects, Law and Economics generally being associated with higher earnings. In FE, it is harder to draw conclusions, but subjects such as Business Administration and Engineering have a high value-add for women and men respectively.
In HE, on average, achieving a higher degree class is associated with a higher value-add in earnings. Women who achieve a first-class degree earn 3.5% more and men 7% more than people of similar characteristics who achieve a 2.1.
In HE, 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.
Degrees from higher tariff universities are more likely to be associated with higher earnings than those from a lower tariff. Why does going to a high tariff university increase your earnings potential? There are two possible answers:
*these universities provide students with skills and knowledge which enable them to earn more than those who went to lower tariff universities
*these universities signal to employers that the students are more able, so these students get jobs in the best firms
We do not know what the balance is between these two.
The impact of subjects studied
Overall, the following subjects are associated with a negative value-add in earnings at age 29 for men: Creative Arts, Communications, English, Agriculture, Sociology, Philosophy and Languages. For women, there were no subjects associated with a negative value-add in earnings at age 29.
Let us look at a couple of subjects as a way of understanding how the data can be presented:
This graph shows the median earnings in pounds for Law students five years after their graduation year, men and women:
Source: DfE dataset
Medicine: women only
This graph shows the estimated value-add in earnings at age 29 by university for women who studied medicine. The estimated average earnings difference (in %), relative to a graduate of any subject but with similar background characteristics:
This data is available to the public and can normally be found by searching for ‘longitudinal outcomes’.
There are many good reasons for going to university and lifetime earnings is only one of them.
But if students are facing a debt of £50,000, they should at least know which universities and which courses are most likely to give them some return on this investment.
Students from lower SEGs are less likely to know that different universities and different courses within these universities yield very different expected lifetime earnings. So there is a job to be done by careers advisers in schools.
By Professor Barnaby Lenon
Dean of Education, University of Buckingham
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