Page last updated at 04:57 GMT, Friday, 19 March 2010

Can you afford not to go to university?

By Margaret Ryan
BBC News website

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Students Scott Austin Shaw, Sophie Richardson, Alex Mbaya and Student Union President Nasir Tarmann on what they hope to get from university

As universities in England learn how hard they will be hit by higher education funding cuts, students may be concerned they face increasing costs just to get through their degree.

But as more young people go to university in the UK, will those who decide to call it a day after A-levels find this decision proves a costly one?

Students considering university might be put off by the prospect of higher tuition fees, a hefty student debt and years more studying.

A review into higher education funding due in the autumn might recommend students pay more.

Universities are not just graduate factories turning out a ready supply for business - they are there to teach all sorts of things
Sally Hunt
University and Colleges Union

But graduates can expect to earn £100,000 more over their working life after tax than teenagers who get a job after A-levels, according to the government.

It still wants to reach a situation where 50% of people aged 18-30 participate in higher education. In 2007-2008, the participation rate reached 43.3%.

UK graduates can expect to earn even more than the government suggests, gaining on average 157% more than non-graduates, according to the Organisation for Economic Co-operation and Development (OECD).

Analyst Andreas Schleicher says improved graduate job prospects have a knock-on effect for the wider economy.

"This is not simply a zero-sum game where those with university degrees are pushing out those without degrees from a fixed set of jobs."

Countries that have done well in raising the proportion of highly-skilled workers have also seen better employment prospects for the lower skilled as job opportunities filter down, OECD data suggests.

'Not all courses equal'

But graduates' prospects of gaining the highly-skilled jobs depend on the university they go to and the course they do, according to John Philpott, chief economic adviser at the Chartered Institute of Personnel and Development.

"There will be a gradual realisation that not every degree is of equal value in market terms," he says.

UNIVERSITY FUNDING
This is part of a special series on the BBC News website looking at the challenges facing higher education in the UK.


He believes students need better information on the "likely level of pay" that could follow a particular course and that they will consider increasingly the "return" on their degree.

For undergraduate Alex Mbaya, in his final year at Queen Mary, University of London, these considerations were not uppermost in his mind when he started his pharmaceutical chemistry degree.

"I just had a passion for science. I didn't really think about a career at the end. It was what I really wanted to do. I wanted to learn more and enjoy it," says the 23-year-old.

He is convinced he will fare better in the jobs stakes because he has been to university.

"It is true at the end of this degree I will have £28,000 worth of debt but having done science I am certainly one of the winners. I can go into finance or I can transfer to law or even stay in science," he says.

Final-year student Sophie Richardson also took her French and linguistics degree because she was interested in the subject. Even with a debt of £36,000 the 22-year-old does not regret her decision.

"I think I will be able to get into a higher level of job than I would have without a degree," she said. "I hope so."

Best motivation?

Her optimism does not seem misplaced. Ian Brinkley, associate director of the Work Foundation, says the "premium" graduates can earn has remained constant over the past 10 years.

He believes this will continue, especially in sectors where demand is likely to be high, such as business services, IT, computer services and the creative and cultural sector.

Student numbers graph

Courses in science, engineering, mathematics or computer-related subjects will attract greater financial returns than humanities or arts degrees, he says.

University and Colleges Union general secretary Sally Hunt does not think a "graduate premium" is the best basis for deciding on a course. She says students should be encouraged to pursue what they have always wanted to do.

She also fears the cost of university means some students are choosing a course because it is nearer home.

"Universities are not just graduate factories turning out a ready supply for business - they are there to teach all sorts of things.

"Graduates are less likely to be involved in crime, they are less likely to be on benefits and less likely to be a burden on the NHS, so the case for investing in students is clear."

Friends made

Wes Streeting, president of the National Union of Students, says going to university is about more than the financial rewards, including the network of friends made and the broader experience it brings.

Although graduates are leaving university with record levels of debt, he says people should not be put off applying as they are likely to face a better economic outlook.

Graduates
Is there more to going to university than chasing a career?

The government is keen to point out that more people are at university than ever before. In 2008-2009, there were nearly 2.4 million people in higher education in the UK compared with more than 1.5 million in 1994-1995.

Higher Education Minister David Lammy said: "A degree is a strong investment which stands graduates in good stead for a long and successful career, giving them better prospects than those with lower qualifications."

He says university is "not the only choice" and that more resources are being put into other training, including money to create jobs for long-term unemployed young people.

'Second-rate'

But economist Mr Philpott says: "The push for more graduates is partly based on the conception that it is good financially to get a degree and it has a social cache and the idea that people who don't get a degree are somehow treated as second-rate. That attitude will take some time to shift."

For those considering university, Mr Streeting says: "My advice to young people is to think really carefully about what they want to do, what interests them, what excites them and what the best route is for them."

Second-year drama student Scott-Austin Shaw does not need convincing about the merits of university.

"You can learn a lot about yourself and what you want to achieve in life from the different people you meet and the different things you get involved in.

"I would stay forever if I could," he says.


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