Is university still worth it? The numbers behind the UK’s education system
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It is no surprise that the UK’s current economic conditions have hit students’ wallets hard. However, it is not only the state of global markets that is calling into question the economic viability of going to university in 2023.
The numbers in 2023
Students are already cutting costs at all corners to get by - according to The Sutton Report, 63% of students spend less on food and essentials, 28% skip meals to save on food costs, and 47% have reduced or stopped socialising in order to save money. But will it have been worth it upon graduation?
It appears not. The current average graduate salary in the UK is £24,291. The average graduate salary in 1995 was £14,362. This means that salaries have only risen by a dismal 40.8% over the last thirty years, compared to a 117% rise in inflation in the same period.
After taking into account tax and national insurance, the average graduate will be taking home around £20,540.28. Assuming you work nine to five, Monday to Friday, every week of the year, this equates to £1711.69 per month, £395 per week, £79 per day, and £9.87 per hour. This is less than the National Living Wage of £10.42 per hour.
Such numbers are further compounded by the size of student loans. The terms of the Plan 5 repayment scheme, introduced in September 2023, changed the period of time workers are obligated to make repayments from 30 to 40 years and increased the interest rate to 7.3%. This means many will be paying off their student debt well into their 60s. It appears the dystopian proposition of a society of debt slaves no longer seems so remote.
With a maintenance loan that allows you to borrow up to £13,022, the average debt incurred upon graduation rounds out to about £45,600. At the current interest rate, the burden of every student loan then increases progressively and rapidly. According to the Office for National Statistics, 95% of those eligible were taking out loans in 2021/22. Shockingly, the UK government only expects 27% of graduates to be able to repay these loans in full - an extraordinary difference.
If we compare this with the situation in 1995, the starkness of the difference between generations is remarkable. Between 1962 and the mid-1990s, higher education in Britain was effectively free due to state funding. This was until tuition fees were reintroduced in 1998 at £1000 per year. And yet, starting salaries for graduates have essentially remained stagnant. The fact that tuition fees have substantially increased to £9250 per year and inflation has risen by 117% highlights the difficulty of the situation many students face today.
Is it still worth it?
It becomes clear that the entire premise of university education for many students is erroneous. University is primarily promoted as a means of enhancing career prospects, yet students can easily find themselves in a job that pays minimum wage and with an ever-growing debt. In 2023, the total public debt for UK and EU students studying in the UK was £205.6 billion. What is the value of such a qualification? How can we continue to justify an education system that keeps young people perpetually in debt?
Previously, a university degree was widely considered a good assurance of a job upon graduation. However, this is no longer the case in an oversaturated job market where a stellar CV, outstanding references, and exceptional cover letter can prove to be insufficient. Needless to say, it is obvious why entry rates of British students are declining and increasing numbers are instead turning to degree apprenticeships offered by reputable companies such as Rolls Royce, Jaguar, Dyson, and L’Oréal.
We now live in a hyper-globalised, post-COVID-19 era where an increasing proportion of our education and general interactions take place online. It can no longer be said that being a university graduate is synonymous with being ‘educated’, as formal education is no longer confined within the walls of a university, especially with the growing use of free courses offered on platforms such as Coursera and Futurelearn.
Of course, there is more to university than the employment and salary you receive after graduation. It is not just a means to an end. It’s the developmental bridge between adolescence and adulthood, the process of becoming self-sufficient, and the time to experiment with possibilities for your future.
But the numbers show how increasingly difficult such an education is to fund…and can the costs still be justified?