Study shows students’ wage expectations to be wide off the mark
A new study by a researcher at the University of Southampton suggests that many students’ expectations of how much they will earn after graduation do not match the reality.
On average, the study shows that full-time students overestimate their starting salary by around 10 per cent (£1,600), though this masks large differences between groups. Students in their first year, those at post 1992 universities, and those studying for a language degree could be overestimating their starting salary by as much as £3,000 on average, says study author John Jerrim, a PhD student in the University’s Social Sciences.
“This is equal to the current yearly tuition fee for most university courses,” adds John Jerrim. “In contrast, part-time students and those studying degrees in education have more accurate expectations, and could even be underestimating the value of their degree.
“A university education can bring financial benefits over a graduate’s lifetime, along with significant non-monetary gains,” continues John Jerrim. “However, it is also possible that some young adults enter university with unrealistic aspirations about future income levels.
“It is vital that students thoroughly research their future employment prospects when going to university, so they can make informed choices about the subject they study and institution they attend. They need to understand that starting wages vary dramatically by course and university, and simply having a degree does not guarantee a graduate job and a silver-plated salary.”
The study was conducted using official government survey data from 2005, that gathered information from students studying in a wide number of universities and subjects across England and Wales. Wage expectations were drawn from over 3,000 respondents, and compared to the average starting salary of over 40,000 graduates. The results apply to full-time students who studied for a first degree in a subject other than medicine, who went to university in England or Wales and were under the age of 25.
John's research has been used as the basis for articles published recently in The Daily Telegraph and The Times.
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Notes for editors
The figure used for the starting graduate wage in this paper is £16,455. The official government figure, provided by Higher Education Statistics Authority (HESA), for the starting graduate wage is £18,531. HESA rounds this to £19,000 (see http://www.hesa.ac.uk/index.php/content/view/126/161/).
There is a large difference between the figure from the University of Southampton study and the HESA figure, despite both being calculated from the same data source. The reasons for these differences are as follows:
(1) The University of Southampton study uses the wages of graduates who were studying full-time when they were at university. The HESA figure relates to the wages of both those who were studying full-time and those who were studying part-time when they were at university.
(2) Medical students have been excluded from the University of Southampton analysis, but are included in the HESA figure.
(3) The University of Southampton study has adjusted the reported wages for inflation. The figure used is therefore in 2005 prices, whereas the HESA figure is in 2006 prices.
These differences are fully documented in appendix 5 of the University of Southampton report, Wage Expectations of UK Students: How Do They Vary and Are They Realistic http://eprints.soton.ac.uk/63558/
The restrictions have been made to ensure the two data sources are comparable.