By Gill Wyness
With UK tuition fees now among the highest in the world, but benefits from having a degree remaining substantial, choosing the right university has never been more important for young people. The government has tried to make this easier by offering more and more information not just on the university experience but on the quality of the institution and even the potential wage return students could reap.
Despite all these efforts to make the decision about where to apply as informed as possible, one issue remains: students still apply to university based on their predicted rather than actual qualifications. And these predictions are not always accurate.
Using information on university applicants’ actual and predicted grades and their university attended, obtained from the Universities and Colleges Admissions Service (UCAS), I find only 16% of applicants achieved the A-level grades that they were predicted to achieve, based on their best 3 A-levels.
Higher education finance might be the last thing on America’s minds when they cast their votes on Tuesday. However, the fact that both candidates have set out plans to reform the US’ student loan repayment schemes is perhaps indicative of the importance of this issue in the US. The problem is, both candidates are just messing with the small print, and their plans which will do very little to help graduates struggling with student debt.
Trump intends to push for an income-driven repayment plan that would increase the level of the payments students have to make (by increasing the cap on payments from 10 to 12.5 percent of income) but reduce the repayment period to 15 years from its current period of 20-25 years (depending on the scheme). Meanwhile Clinton has endorsed the current plans, with the caveat that she aims to simplify the number of plans.
But will these proposals help students who are struggling with their loan repayment? The short answer is no.
For the most part, when we think about social mobility, our concerns are with those on the lower rungs of society’s ladder; people “for whom life is a struggle and who work all hours to keep their heads above water” as Prime Minster Theresa May put it in her most recent speech on the matter. One of the issues often considered is how likely are those from disadvantaged backgrounds to enter into higher education. This is often viewed as the direct route to the top jobs in the UK where a degree is almost always a pre-requisite now. The hope is that, if society is meritocratic, rewarding those for effort and achievement rather than family background, if we get more disadvantaged kids into higher education then this will equalise their chances of reaching the top jobs. Unfortunately, in the UK, this does not seem to be the case. Recent research by ourselves, and colleagues from Cambridge, Bath and Warwick university has revealed that higher education is not the leveller we might hope it to be, and that socio-economic differences persist throughout higher education and into the graduate labour market, even comparing those with similar educational attainment.
Every few weeks, a new report emerges raising concerns about the graduate labour market in Britain.
Only recently in the UK, the Chartered Institute of Personnel and Development (CIPD) came out with a plea for a halt to the expansion drive in higher education. Earlier in the summer, an Institute for Fiscal Studies report, while noting that the graduate earnings premium had been steady (or increasing, even) for many years, warned that the future might not be so bright.
Indeed, there seems to be growing concern that, maybe, higher education has expanded to the limit over the past 20 years and can take no more. So, should governments be worried about the underemployment of graduates – that is, graduates doing supposedly non-graduate jobs?
Our short answer to this question is: “Yes, but…” Let us explain why.
By Anna Valero and John Van Reenen, Centre for Economic Performance
In 1900, only one in a hundred young people in the world were enrolled at universities, but over the course of the Twentieth Century this rose to one in five. It turns out that this enormous expansion of the higher education sector was not just the product of riches – it has helped fuel economic growth.
We compiled new data based on UNESCO’s World Higher Education Database detailing the location of 15,000 universities in 1,500 sub-national regions across 78 countries over the period 1950 to 2010. On average, doubling the number of universities in a region increases that region’s subsequent income by over 4%. There are also spillover effects to other regions in the same country, creating a growth multiplier.