Written by Pearl Mok, Labour Market Information Co-ordinator, Graduate Prospects. (November 02).
Our own studies based on current figures have consistently shown that graduates earn significantly more than non-graduates. This finding has recently been further supported by research from the London School of Economics (LSE), which investigated the impact different qualifications have on an individual's earnings (ie the returns to qualifications). According to the LSE's research, the possession of a first degree alone increases earnings by around 26%. The corresponding figures for two or more A-levels and five or more good (grade C or above) GCSEs are estimated to be 16% and 28% respectively. For someone who holds all these key academic qualifications, the returns would be around 70%. Some other main findings from the study include: - Among all the vocational qualifications analysed, graduate level professional qualifications (eg law and accountancy) are found to give the highest returns. The associated increase in earnings is found to be between 36-45% for men and 42-49% for women.
- Although both men and women benefit from teaching and nursing qualifications, the effects are considerably greater for women.
- For males, the possession of a first degree raises wages by 29% in the private sector, compared to 17% in the public sector. The corresponding figures for females are more similar at around 30% and 25% respectively.
The study has also found that the returns to higher level academic qualifications have stayed virtually unchanged during the period studied (1993-2001). With increasing numbers of students obtaining these qualifications, the study concluded that the demand for this skilled labour is rising as fast as its supply and the point where there are too many people going into higher education has not yet been reached. For more information about this study, see the value of academic and vocational qualifications. Related topics:
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