At age 29 male graduates earn £13K more per year than those with 5*-Cs without a degree while women earn £10K per annum more.
Look at another way, this means that a degree should pay for itself after just four years if you’re a woman, and three years if your a man…
I calculated these figures based on research into the impact of degrees on future earnings at the age of 29 conducted by the Institute for Fiscal Studies.
If you look at the wages earned by HE graduates compared to people who got 5 A*-Cs at age 29, then female HE graduates earn £10K more per year before tax, while men earn £13K more per year, again after tax.
If we reduce this difference a little to take account of taxation, then we get the figures above: a degree pays back in earnings after just 3 years for men and 4 years for women, at least once they reach the age of 29.
All of this assumes tuition fess are £9K a year for 3 years, and doesn’t take into account the opportunity cost of HE students not having earned anywhere near as much for 3 years while studying compared to non HE students.
Having said that, I think it’s fair enough to take a long term view, and look at things 6-7 years or so after graduating… a degree is a long term investment after all.
My tax calculations are also approximate.
NB – the above figures are averages, and there are considerable variations on this depending on the subject you choose to study, and other factors such as your class background. For more info on the study, you might also like this post!