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Graduates: Income

Business, Innovation and Skills written question – answered on 11th September 2013.

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Photo of Frank Field Frank Field Labour, Birkenhead

To ask the Secretary of State for Business, Innovation and Skills what recent estimate he has made of additional life time earnings of graduates.

Photo of David Willetts David Willetts Minister of State (Universities and Science)

There have been several studies of this over recent years, some commissioned by BIS and its predecessors, some commissioned by other organisations. Whilst they differ in terms of methodology, time periods covered and some of the underlying assumptions, they all use a broadly similar approach, and taken together they point to there being a substantial lifetime earnings premium for graduates due to having their degree. Looking across the studies our conclusion is that over the course of a working life the average graduate earns comfortably over £100,000 more in today's valuation, net of tax, than someone with two or more A-levels who does not go to university.

The most recent research was published in the BIS research series in August 2013. The estimate of the lifetime graduate earnings premium was higher than previous estimates: £250,000 for women and £165,000 for men (see:

https://www.gov.uk/government/publications/university-degrees-impact-on-lifecycle-of-earnings

This graduate premium is an average and it will vary across individuals, subjects and institutions—however, the evidence shows that people still tend to be financially better off with a degree than without.

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