A university education: what is it worth?
As tuition fees rise does the cost of a university education still add up? Channel 4 News charts predicted earnings as new figures reveal a degree could now be worth an extra £12,000 a year.
As universities get ready to charge students up to £9,000 per year in tuition fees from 2012, does getting a degree still make financial sense?
Newly calculated figures from the Office for National Statistics (ONS) reveal that graduates can still expect a return on the cost of their studies. In the last decade they earned, on average, £12,000 more than non-graduates.
“This analysis shows there is a big difference between average earnings for graduates and non-graduates,” says ONS statistician Jamie Jenkins.
The statistics, taken from the Labour Force Survey, show that earnings were around £15,000 for 22-year-olds, regardless of whether or not they had a degree.
Graduate earnings - click here for the ONS figures in full
For non-graduates, earnings increase every year up until the age of 30 before levelling off and peaking at 34 at £19,400.
This analysis shows there is a big difference between average earnings for graduates and non-graduates. Jamie Jenkins, ONS
But using these projections, graduates can expect to see their earnings increase faster, and for longer, with average pay peaking at £34,500.
Male-female pay gap
The figures show that the type of degree taken by men and women may be contributing to the pay gap. In 2010, 34 per cent of women graduates had a degree in health related subjects or education, compared with 9 per cent of male graduates.
Average earnings over the last decade for graduates in public administration, health and education sectors were £27,600.
In comparison, 47 per cent of male graduates had a degree in business and finance, science or engineering, against 20 per cent of female graduates. Average earnings over the last decade in sectors related to these degrees, such as the banking and finance industry, were £37,300.
University fees: Who charges the most? Check the #c4news map
But with the price of university now rising – because of fees and living costs – we may begin to see a levelling out in the earning clout of graduates compared to those who went straight to work from school. Calculations show the true cost of a three-year course could be nearer to £60,000, with the fear of debt threatening to undermine the lure of higher wages.
Read more: FactCheck – Will graduates pay less, as Clegg promises?