Explores the earnings benefits from getting a degree. BIS research paper number 112.
This report follows ‘The Returns to Higher Education Qualifications’. It provides evidence on how higher education (HE) affect earnings, including:
- returns to HE: the percentage increase in earnings from having a degree, over and above those who have 2 or more A-levels but no HE degree
- additional lifetime net earnings gained as a result, known as the ‘graduate premium’
The study compares the earnings (and employment) of people who have a first degree (and 2 or more A-levels) with those with 2 or more A-levels and no higher education degree, irrespective of the subsequent qualifications. This better captures how young people make decisions about their futures.
It confirms previous estimates that degrees provide substantial private and Exchequer benefits. It also looks at whether the benefits vary for different groups of people before and after HE expanded in the late 1980s and early 1990s.
Compared to previous research, the estimates in this study suggest larger impacts on lifetime earnings for individuals, and a greater social benefit to the government.