WOMEN WITH DEGREES EARN THREE TIMES MORE THAN THOSE WITHOUT, SAYS NEW STUDY – BUT ARE THE STATS RELIABLE?
Is university worth it? According to new figures, the answer is yes – especially if you’re a girl. Female university graduates earn at least three times more than non-graduates of their gender within a decade of leaving university, suggesting that a degree is a particularly wise investment for young women.
The so-called ‘graduate premium is higher for female graduates than male graduates, the study found. While a woman with a degree earns three times the salary of a woman without one, a man with a degree earns only twice the salary of a man without one.
However, analysts found that male graduates continue to earn more than female graduates overall. Ten years after graduation 10% of male graduates were earning more than £55,000 a year, 5% were earning more than £73,000, and 1% were earning more than £148,000. By contrast, ten years after graduation 10% of female graduates were earning more than £43,000 a year, 5% were earning more than £54,000 and 1% were earning more than £89,000. Although this difference is big, it is not as big as other studies have suggested: 23%, as opposed to the figure of 33% stated by the official Labour Force Survey.
The study – conducted by the Institute for Fiscal Studies, Cambridge and Harvard universities – showed that the recession has had a negative impact on workers in their 20s and early 30s, but that graduates have suffered proportionately less than non-graduates. Jack Britton, a research economist at the IFS and an author of the working paper, said:
“This study shows the value of a degree, in terms of providing protection from low income and shielding graduates from some of the negative impact of the recent recession on their wages. We find this to be particularly true for women.”
This seems like good news, but Graduate Fog is concerned by some of the detail in this research. The median figure for a non-graduate woman in her early 30s is £6,300 and for a man £10,700. For graduates, the figures are £19,500 and £25,200, respectively. Doesn’t that sound quite low, especially considering the level of student debt those graduates will have?
(Actually we think it sounds pretty low for non-graduates too, but that’s for another website to campaign on).
Also, we feel care should be taken in drawing conclusions about the current value of university from figures that are collected from a group of graduates who are more than ten years into their working lives.
(The study used tax records and student loan data for 260,000 people who were at university between 1998 and 2011 and whose earnings were looked at for the tax year 2011-12).
A lot has changed since then. Graduate Fog’s founder Tanya de Grunwald was at university between 1997 and 2000 – and at that time unpaid internships were unusual (and much shorter than they are now), fewer young people had degrees, and graduates found it relatively easy to secure employment, and the economy was far stronger. The job market today’s graduates enter is much, much tougher than it was back then.
* WHAT DO YOU MAKE OF THESE NEW STATS?
Are you encouraged to see female graduates earn so much more than non-graduates? Or are you hesitant about drawing any conclusions from them about the fate of today’s graduates, given the sample surveyed graduated ten years ago? What are your predictions about the earning potential of young people graduating today – do you feel confident you’ll be earning much more in your 30s than your peers who don’t have a degree?