Is a degree a good investment?

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More young people than ever are going to university, but the financial stakes have also risen. Many graduates begin their careers with around £50,000 of student debt and could make repayments for up to 40 years. While some degrees deliver substantial lifetime earnings gains, others may leave graduates financially worse off than if they had not attended university.

Helen Miller is joined by IFS economists Christine Farquharson and Kate Ogden to examine what the evidence tells us about the financial returns to higher education.

They discuss why graduate outcomes vary so widely across subjects, institutions and students; whether low-earning courses provide value to taxpayers; and whether government should restrict funding for degrees with poor financial outcomes.

They also consider how artificial intelligence and wider labour-market disruption could affect today’s students, and whether historic earnings data can reliably guide decisions about careers that may last into the 2070s.

Zooming in discussion questions:

These are a set of questions designed for A Level economics students to discuss, written by teacher Will Haines.

1. What is the difference between the financial returns to university education and the social returns to university education?
2. How do you think AI will affect the demand for university places and the demand for specific degree courses?
3. Assess the factors that a sixth-form student should consider when deciding whether to attend university.