What's a degree worth?

Research by the London School of Economics shows that students who gained a first-class degree earned £1,000 a year (3%) more than classmates who secured a 2:1. Yet while men with first-class degrees gained an income premium, women with firsts gained no extra income, the research suggested. Also, students who gained a 2:1 earned 7% more than those with a 2:2.  This premium was worth an extra £81,000 in wages over a graduate's working life, the study said.

Andy Feng and Georg Graetz analysed exam marks of 2,649 LSE undergraduates between 2005 and 2010 for their paper A Question of Degree: the effects of degree class on labour market outcomes. They state: ‘Our study is probably the best evidence available that exam results matter, but there's a lot more work to be done in understanding what drives the gender split and figuring out if the differences in pay-offs by degree result eventually go away.’

Against that rosy picture for the highly qualified, human resources magazine People Management last month stated that more than half of current graduates (52%) are either unemployed or in non-graduate jobs. A report commissioned by the Association of Accounting Technicians (AAT) found that this is set to increase to 55% for the class of 2011, who will graduate this summer. The unemployment rate for new graduates is 20%, double the UK average of 7.8%, while 42% of graduates are in a role that does not require a degree, up from 32% in 2006.  [ Source: SSAT Policy Radar ]