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What is the value of university?

With students paying more than ever, richer data is needed for them to accurately know how much their course will enhance their prospects. 

With students paying more than ever, richer data is needed for them to accurately know how much their course will enhance their prospects.
Students pose for their official group photograph at the University of Birmingham. Photograph: Getty Images.

Gulp. Results day. Thousands of young people will find out for certain, on the back of their A-level grades, which university – if any - they should be spending the best days of their lives at.

Today’s school leavers are luckier in that they have more choice about where they can study, with more higher education institutions and places than ever before. This is in part because this government is allowing universities to expand: 30,000 extra places have been granted for 2014/15, and universities can recruit as many students as they want with grades ABB or above. Clearing – where extra places are available in late August – is no longer for those who don’t get the grades for their first choice; top universities now offer additional places, sometimes eagerly hunted by those with the results to upgrade.

In fact, next autumn, there will be no limit on the number of students universities can admit. Universities are having to do much more to compete with other institutions to attract students. Vice-chancellors are offering scholarships and rent rebates. Free ipads, even. When I was a student, the only free deal we were offered was from banks offering young person's rail cards - mine now lapsed too many years ago.

With fees now usually triple what they used to be, students should be asking: is this really worth it? Well, if you look at the return on investment in general, then yes it is. The latest evidence shows, on average, the premium from a person attending university compared to their peer who didn’t attend but had similar prior attainment is nearly £200,000 over a lifetime. This far exceeds the amount of student loans you need to repay during your lifetime.

But this is an average. More important is whether your particular course is worth it. Now, future salaries are not the only indicator of quality, and the value of education is not just instrumental, but typical salaries are increasingly and understandably a prime consideration for students.

Universities now have to publish Key Information Sets (KISs), which includes data on the salaries of graduates from particular courses. Problem is, this data is very limited. It derives from the Destination of Leavers from Higher Education (DLHE) Survey, where the data is collected at six months and just over three years since graduation. Not only are both points of time too early to measure career success - considering further degrees, traveling and career swapping – but the response rate is very low and unrepresentative, especially for the later time point.

New, better data will be available soon, which uses information from HMRC’s PAYE system and the Student Loans Company, matching the majority of students’ salaries at any point in time with their university course and institution. Universities  - in their KISs - should use this richer data on salaries instead.

Nonetheless, even with this more comprehensive information, students will not be able to see what universities are genuinely adding to their future salary prospects. Much of the reported salaries may be to do with factors that are nothing to do with the quality of the student experience offered by an institution. Universities have different entry requirements, so the typical prior attainment of their students varies. Equally, some universities have student cohorts with better job-enhancing networks, or have reputations – possibly dated - that affect employers decision-making. In other words, Oxford University could do very little for their students, but their graduates could still earn a lot in the labour market because they are high ability anyway, are exposed to strong networks, and come from an institution with a tradition of a strong reputation.

That is why the future reporting of average salaries for university courses should be as a premium, measuring against people with similar prior attainment and career destination who did not attend that institution. It would still not show perfectly how institutions are adding to students’ salaries, but it would certainly be a fairer indication than now.

This contextualising of outcomes is also needed for the reporting of degree classifications, usually in league tables, that students obtain. Raw, these results are misleading. The higher proportion of top degrees may be more of a reflection of higher ability students, rather than the quality of teaching at an institution. So, a score is needed which measures how well students progress from A-level to the end of a degree, as the Guardian University guide does. A robust Value-Add score to show how teacher quality affects attainment in different degrees should be in KISs too.

With students paying more than ever, richer data is needed for them to accurately know by just how much their course will enhance their prospects. Then they will be able to assess whether their particular university course really is worth it.