Graduate premium – is it worth its weight in gold?
Graduate premium – is it worth its weight in gold?
According to Fraser Nelson of the Spectator magazine, during a discussion on the 10pm news last Sunday evening, research was conducted by the Institute of Fiscal Studies which indicates that many universities are running degree courses that employers do not recognise. The report also shows the concept of ‘graduate premium’ does not apply to the young people who study certain courses at the universities. Graduate premium, according to the government, means that graduates earn on average £100,000 more in their lifetime compared to non-graduates.
Half of graduates are underemployed
Certain courses will not help the young person with a degree get a graduate-level job at the end of it. They did not quite mention the courses in question or the universities that offer those courses but I have my suspicion about the courses. What they did mention in that news bulletin is that 47% of graduates end up with a job for which they do not need a degree to do. I must clarify the last point I have just made; they did not say that people got jobs that are not related to the degree course they have studied but that for the job they got, they did not need a degree to do those jobs.
The so-called graduate premium is not as amazing as it is portrayed to be and it is an average figure. Figures vary widely and it depends on the degree the student studied and the job they do after graduation. The university they go to is not often included in that particular survey but it matters hugely.
The claim that a graduate earns £100,000 more in their lifetime than a non-graduate is an average figure and is misleading. In reality, those who study Medicine and Engineering earn a lot more than an extra £100,000, but for many other professions the average figure is much lower, and in some cases graduates actually earn less than some non-graduates.
I’ve written in the past about the so-called ‘McJobs’ – a word that I think is derived from the idea of flipping burgers at McDonalds. I must say that I have nothing against McJobs in principle. Not only because I did such jobs when I was a young man before I went to university, but I actually think that every teenager or young adult should experience working in a factory, on a hamburger stand or at a minimum wage and labour intensive job at some point in their lives. It must be said that McDonalds restaurants have one of the most effective systems in the works and a lot of skills are learnt when doing such jobs. It is an excellent learning opportunity to do such a job at a young age but doing it for a prolonged period with no job prospects after studying a degree course is a different matter entirely.
Secrecy surrounding the release of universities and courses
The body that conducted the research – the Institute of Fiscal Studies – did not release the name of the universities or the courses. It may not be politically correct to say that some university degree courses are a waste of time. I am a little suspicious about why its been chosen not to release the name of the universities or the degree courses they are offering with little or negative graduate premium. Considering what is at stake for young people who may be borrowing up to £44,000 to study at a university, with little or negative prospects of earning high income after graduating, I think it is important to release the figures.
As young people are this week in the final stages of making up their minds about which university to go to and which course to study, it is vital that they make the correct decision. It helps to go to university and personally I think there is a case for studying for the sake of studying – provided one finds it stimulating However, it is critical to be well informed so that a young person is aware of his or her chances after studying a particular degree course at a particular university.
In my next two blog articles, I will look into the facts and figures surrounding this vital matter on graduate premium and also provide some guidance and suggestions that may help a young person and their family to decide on universities and courses. In addition to helping to guide students who are about to enter university this autumn, information provided will also be useful for those parents whose sons and daughters are still in school and are not about to go to university this September.
Useful link – BBC news referred to in the article: http://www.bbc.co.uk/programmes/b07nn83n
Next blog: http://excelinkeysubjects.com/university-course-options-potential-impact-lifetime-income-prospects/