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One in five students lose money by going to university, IFS finds

daftandbarmy

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One in five students lose money by going to university, IFS finds

Men benefit more than women and creative arts provide worst returns, according to tax data

One in five students would be financially better off if they skipped higher education, according to groundbreaking research that compares the lifetime earnings of graduates and non-graduates.

Analysis by the Institute for Fiscal Studies found while 80% of former students gained financially from attending university, about 20% earned less than those with similar school results who did not attend, highlighting how some subjects, such as creative arts, offer negative financial returns.

The IFS research – which uses tax data to measure the earnings of those who went to university from the mid-90s onwards – found that after accounting for taxes and student loans, men gained on average £130,000 and women £100,000 over their careers, compared with their peers who didn’t enter higher education.

As well as the total “graduate premium” being different between the sexes, it is also unevenly distributed over time, with women reaching a glass ceiling on earnings growth in their 30s and 40s, even among Oxbridge graduates. The premium also differed depending on the subject studied.

The report comes as the government in England is applying additional scrutiny to universities and outcomes for graduates, with some ministers looking to restrict the numbers taking so-called “low-value” courses.

Overall, the IFS found the government benefited from extra tax revenue and national insurance contributions of £110,000 per man and £30,000 per woman, over and above the costs of study to the government.


https://www.theguardian.com/education/2020/feb/29/one-in-five-students-lose-money-by-going-to-university-ifs-finds

 
This shows, once again, that I'm an old bugger.

When I started high school, the five-year program classes (basically heading to Ryerson or university were numbered from 5/9/A to 5/9/T. There were also about half as many four-year classes.

At the end we graduated two grade 13 classes.That's two out of roughly thirty classes that graduated eligible to go to university. That's an awful lot of kids back then that dropped out or completed their high school education below the university entry level.

I've always been of the opinion that we need a lot fewer universities and a lot more trade, technical and service oriented education than history and arts majors (and maybe JDs  ;D)

:cheers:
 
In the 1970's, I recall reading Jimmy Hoffa doubling and tripling wages in the Teamster's union.

It reached a point where some college professors were reportedly quitting their jobs to become truck drivers.

There are still good union jobs out there. But, they may not be the clean, inside work, with no heavy lifting and a thermostat on the wall that many desire.
 
FJAG said:
This shows, once again, that I'm an old bugger.

When I started high school, the five-year program classes (basically heading to Ryerson or university were numbered from 5/9/A to 5/9/T. There were also about half as many four-year classes.

At the end we graduated two grade 13 classes.That's two out of roughly thirty classes that graduated eligible to go to university. That's an awful lot of kids back then that dropped out or completed their high school education below the university entry level.



I've always been of the opinion that we need a lot fewer universities and a lot more trade, technical and service oriented education than history and arts majors (and maybe JDs  ;D)

:cheers:

Can't we be both ?
 
I find myself wondering if those 1 in 5 are directly related to barista job skills, and gender studies degrees?  But that's my sarcastic side...

 
NavyShooter said:
I find myself wondering if those 1 in 5 are directly related to barista job skills, and gender studies degrees?  But that's my sarcastic side...

Well the study does mention creative studies so that would make sense.

I have friends in their mid to late 40s only having recently paid off their student debts. 

 
perhaps getting rid of the stigma attached to having a labour style occupation would be a good place to start.  A teacher is in a career whilst a brick layer (my apologies to bricklayers) has a job.  There are thousands of jobs out there that do not require university yet we have put a degree in as a requirement i.e. many coast guard and transport positions.  A watch-keeping officer does not need 4 years of university, he/she needs specialised courses in navigation, ship systems, marine law and then time on the bridge as an apprentice. Nursing was an OJT style occupation with classroom associated, teaching was a one year college course of which a quarter of ones time was spent out in a classroom receiving practical training, air traffic control required a 4 year graduate level and acceptance depended upon passing the aptitude tests. 

Society has taken these and many other skills related occupations and put them in the university stream and then looks down its nose at the cabinet maker.  Parents and guidance counsellors steer people towards the university stream when quite frequently, the aptitude and the desire isn't there.  So we probably have a lot of unhappy people out there with degrees who would perhaps be more content welding up on of the new AORS.   
 
YZT580 said:
perhaps getting rid of the stigma attached to having a labour style occupation would be a good place to start.  A teacher is in a career whilst a brick layer (my apologies to bricklayers) has a job.  There are thousands of jobs out there that do not require university yet we have put a degree in as a requirement i.e. many coast guard and transport positions.  A watch-keeping officer does not need 4 years of university, he/she needs specialised courses in navigation, ship systems, marine law and then time on the bridge as an apprentice. Nursing was an OJT style occupation with classroom associated, teaching was a one year college course of which a quarter of ones time was spent out in a classroom receiving practical training, air traffic control required a 4 year graduate level and acceptance depended upon passing the aptitude tests. 

Society has taken these and many other skills related occupations and put them in the university stream and then looks down its nose at the cabinet maker.  Parents and guidance counsellors steer people towards the university stream when quite frequently, the aptitude and the desire isn't there.  So we probably have a lot of unhappy people out there with degrees who would perhaps be more content welding up on of the new AORS. 

Nailed it.  :nod:

The one caution I'd have in taking the article I posted at face value is that it seems to have been initiated by a conservative government looking for ways to conserve budget in a post-Brexit world.

De-funding arts programs and denying students loans for 'non-economically viable' degrees would be a big mistake, of course, but could be an option.
 
YZT580 said:
perhaps getting rid of the stigma attached to having a labour style occupation would be a good place to start.  A teacher is in a career whilst a brick layer (my apologies to bricklayers) has a job.  There are thousands of jobs out there that do not require university yet we have put a degree in as a requirement i.e. many coast guard and transport positions.  A watch-keeping officer does not need 4 years of university, he/she needs specialised courses in navigation, ship systems, marine law and then time on the bridge as an apprentice. Nursing was an OJT style occupation with classroom associated, teaching was a one year college course of which a quarter of ones time was spent out in a classroom receiving practical training, air traffic control required a 4 year graduate level and acceptance depended upon passing the aptitude tests. 

Society has taken these and many other skills related occupations and put them in the university stream and then looks down its nose at the cabinet maker.  Parents and guidance counsellors steer people towards the university stream when quite frequently, the aptitude and the desire isn't there.  So we probably have a lot of unhappy people out there with degrees who would perhaps be more content welding up on of the new AORS. 

This post is spot-on in my opinion. There is a real stigma on "blue collar job" and they are looked down upon, but frankly I am surprised that only 1 in 5 university graduates lose money on getting that degree. It would be interesting to see how many years they have to work in their profession before they break even. In a lot of fields, such as Law (which is my own field), I imagine it could take many years.

These numbers may change over time too. For so many years university has been seen as the "default" option that a lot of professions are becoming saturated. Again, using Law as an example, new graduates have really struggled to find articling positions in Ontario. I've had students offering to be my articling student for free rather than be unable to practice as a lawyer due to not having that necessary year of articles. Also, lawyers fees have stagnated for decades so they don't make nearly what they used to, but tuition at law schools has gone up a lot.

There's good money to be made, on the other hand, in trades.
 
daftandbarmy said:
Nailed it.  :nod:

The one caution I'd have in taking the article I posted at face value is that it seems to have been initiated by a conservative government looking for ways to conserve budget in a post-Brexit world.

De-funding arts programs and denying students loans for 'non-economically viable' degrees would be a big mistake, of course, but could be an option.

I also thought it was interesting that the article stated that the study made no attempt to compare hours worked when comparing lifetime earnings.  It stands to reason that some people will want to work more, and consequently earn more, while others will want a more balanced lifestyle. 

I can't say I am surprised that one in five students would lose money by going to university.  If someone fails to complete their education, fails to pursue a particular career path on graduation, or fails to succeed in it, that would likely be a good predictor of their future earning potential based on broader personal factors such as intelligence, conscientiousness, dedication, etc., that would have impacted their prospects whether they went to university or not.

In spite of the headline, I actually thought the article made a great case for the broad income benefits of university education.  With rising life expectancy, and the associated increase in the number of years most people will work, is a 4 year degree not directly tied to a person's eventual career path really such a waste? Why can't a philosophy major take up welding after they graduate? The article also mentions the non-monetary benefits of education, particularly arts education that I think you are alluding to.  Frankly, our world would be pretty boring if we didn't have people dedicating themselves to the performing, visual, and literary arts, and I think we should applaud people who pursue those paths, knowing full well they are unlikely to enrich themselves in doing so. 

Now, there are definitely more and less cost effective methods of acquiring those degrees which should be considered in both individual and state level decision making, and I probably wouldn't recommend someone take on crippling student debt in acquiring a degree that won't pay for itself in a reasonable time frame. However, I think it is a bit narrow minded to consider the benefits of university education purely in terms of individual return on investment. 

Lastly, I would be interested to learn more about what the real gaps in the trades are.  I see a lot of anecdotal evidence - "City X, or Mine Y is short 500 electricians", etc.  Indeed, there are times that trades are in high demand, but the industries trades operate in can be quite cyclical.  Is it actually the case that the labour market fails to meet the demand for trades workers in the long term? Over time, one would expect that rising salaries would eventually drive enough people into those occupations.

It might also be interesting to compare the return on investment of trades education.  My supposition (absent any supporting evidence) is that much like university, trades training broadly provides a good return on investment, but that a certain percentage of those participating will not see an increase in their lifetime income when compared to those to enter the workforce with high school education only.   
 
LittleBlackDevil said:
There is a real stigma on "blue collar job" and they are looked down upon,

Some blue-collar workers cry all the way to the bank.  :)

 
mariomike said:
Some blue-collar workers cry all the way to the bank.  :)

Indeed. Which is why I think that (a) the stigma is unwarranted (there is good work/money to be had in "blue collar" jobs) and (b) why I tell my own children to keep "blue collar" jobs in mind as an option when thinking about what they want to do in life. They may not have the prestige that their dad has as a lawyer, but they will probably make good money with a LOT less stress.
 
LittleBlackDevil said:
Which is why I think that (a) the stigma is unwarranted (there is good work/money to be had in "blue collar" jobs)

From what I have seen of the Ontario Sunshine List over the years, I think you make a good point.
 
Meanwhile:

https://twitter.com/OECD/status/908073371195277312

http://www.cbc.ca/news/business/university-college-degree-salary-1.3695254

http://www.ctvnews.ca/business/education-pays-new-study-shows-average-salaries-by-degree-diploma-1.3003341
 
YZT580 said:
Society has taken these and many other skills related occupations and put them in the university stream and then looks down its nose at the cabinet maker.  Parents and guidance counsellors steer people towards the university stream when quite frequently, the aptitude and the desire isn't there.  So we probably have a lot of unhappy people out there with degrees who would perhaps be more content welding up on of the new AORS. 

I came into the Army as an officer with a Grade 13 (Yup I'm that old) and could have done so with a Grade 11. Never could understand what a university education gives today's officer candidates other that four more years of living.

:cheers:
 
FJAG said:
I came into the Army as an officer with a Grade 13 (Yup I'm that old) and could have done so with a Grade 11. Never could understand what a university education gives today's officer candidates other that four more years of living.

:cheers:
Take a read of, "Forced to Change: Crisis and Reform in the Canadian Armed Forces" by Bernd Horn and Dr. Bill Bentley for the academic viewpoint.
 
garb811 said:
Take a read of, "Forced to Change: Crisis and Reform in the Canadian Armed Forces" by Bernd Horn and Dr. Bill Bentley for the academic viewpoint.

I took a quick scan of the Amazon sample and am not sure if I'll bother getting the book. This is one of those things where I'll readily admit I have a strongly held viewpoint and I doubt what I'll read will make me change my mind. My guess is it will more likely dig in deeper and say "what a bunch of hog wash". Incidentally I hold Horn's writings and research in high regard.

My problem is I lived through those times, saw the folks and attitudes involved and think that we were badly represented at the time. I was deeply involved in the whole Somalia thing as I was appellate counsel for one of the involved members for the Airborne and as such saw in some detail how sausages are made.

All that said, I'm a firm believer that in any society, regardless of its culture, you'll have some brilliant folks and you'll have some morons. Some of our morons showed during that one (and I'm not limiting that to the Airborne or for that matter to the military)

I'm adamant that a university education won't make you a better officer (or for that matter a better person). I think that you would do better with a Sandhurst where you have total control of the curriculum for 44 weeks followed by "development" course at key points in an officer's career.

One of my best educational experiences was at Staff School in Toronto as  young captain. Everyone denigrated the course as useless but I found it taught me to how to research, speak in public and debate with others who came from a different background from me. (stuff that served me very well in law school afterwords) Hell, I learned that Iraq was a piece of s*** country a couple of decades before Gulf War 1 in a seminar led by a pilot. I even got to meet and like some pilots and sailors! And got good at volleyball. Too bad they closed it in the 90s.

I'll stand by what I said. I think officer education is as important as an officer's training. I just can't see how four years in a civilian university or at West Point in Scarlet really makes a better officer. Best to take them young; make them good platoon commanders first and then take the ones that show promise and mentor and educate them for higher roles. Those four years taken off the front essentially means that you have to hurry up and rush things later on. The corollary, incidentally, is that you take the morons amongst them (and we all know who they are) and turf them out. That's really our problem. We keep everybody regardless.

:2c:
 
FJAG said:
I took a quick scan of the Amazon sample and am not sure if I'll bother getting the book. This is one of those things where I'll readily admit I have a strongly held viewpoint and I doubt what I'll read will make me change my mind. My guess is it will more likely dig in deeper and say "what a bunch of hog wash". Incidentally I hold Horn's writings and research in high regard.

My problem is I lived through those times, saw the folks and attitudes involved and think that we were badly represented at the time. I was deeply involved in the whole Somalia thing as I was appellate counsel for one of the involved members for the Airborne and as such saw in some detail how sausages are made.

All that said, I'm a firm believer that in any society, regardless of its culture, you'll have some brilliant folks and you'll have some morons. Some of our morons showed during that one (and I'm not limiting that to the Airborne or for that matter to the military)

I'm adamant that a university education won't make you a better officer (or for that matter a better person). I think that you would do better with a Sandhurst where you have total control of the curriculum for 44 weeks followed by "development" course at key points in an officer's career.

One of my best educational experiences was at Staff School in Toronto as  young captain. Everyone denigrated the course as useless but I found it taught me to how to research, speak in public and debate with others who came from a different background from me. (stuff that served me very well in law school afterwords) Hell, I learned that Iraq was a piece of s*** country a couple of decades before Gulf War 1 in a seminar led by a pilot. I even got to meet and like some pilots and sailors! And got good at volleyball. Too bad they closed it in the 90s.

I'll stand by what I said. I think officer education is as important as an officer's training. I just can't see how four years in a civilian university or at West Point in Scarlet really makes a better officer. Best to take them young; make them good platoon commanders first and then take the ones that show promise and mentor and educate them for higher roles. Those four years taken off the front essentially means that you have to hurry up and rush things later on. The corollary, incidentally, is that you take the morons amongst them (and we all know who they are) and turf them out. That's really our problem. We keep everybody regardless.

:2c:

At Sandhurst there are two types of intakes: the non-graduates and the graduates.

In Britain, they actually manage to attract Potential Officers who have already paid for their degrees out of their own pockets. In return, these people get a second pip pretty soon after passing out of RMAS, giving them a leg up career wise on the 'shovel heads'... like me :)
 
daftandbarmy said:
At Sandhurst there are two types of intakes: the non-graduates and the graduates.

In Britain, they actually manage to attract Potential Officers who have already paid for their degrees out of their own pockets. In return, these people get a second pip pretty soon after passing out of RMAS, giving them a leg up career wise on the 'shovel heads'... like me :)

Okay. So you get the casting vote in this debate. Who made the better officer? The non graduates? or the graduates? Or was there any discernible difference?

:cheers:
 
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