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The UK’s universities minister has called on England's higher education watchdog to do more to intervene and “crack down” on courses that fail to provide “full value” for students in terms of future earnings.
Sam Gyimah even suggested that institutions faced being struck off the official register of providers if they did not comply with Office for Students action to improve particular courses.
His comments came after a new Department for Education-commissioned report showed that 15 per cent of students were attending universities where it was not certain that they would earn more aged 29 than peers with the similar backgrounds who did not go to university.
Some institutions even left students worse off on average at 29 compared with non-university educated peers.
The findings come from an Institute for Fiscal Studies study of the government’s Longitudinal Education Outcomes dataset, which uses tax records to show the earnings of those who took different courses.
It is the second report from the IFS to go further than raw LEO statistics by controlling for the influence on earnings of things such prior attainment and social background, although some factors such as regional wage variation are still not accounted for.
The latest study compared 29-year-olds who did or did not go to university, but who had similar family backgrounds and school achievement (in terms of GCSEs) aged 16.
It found that going to university increased earnings at age 29 by about 26 per cent on average for women, but only 6 per cent for men – a contrast that partly reflects female graduates working longer hours and being less likely to have children by the age of 29 compared with female non-graduates. The figures were slightly higher (28 per cent for women and 8 per cent for men) for those who actually graduated.
The figures also show that about a third of men attended a university that had a negligible or negative impact on their age 29 earnings. At 12 institutions (attended by 4 per cent of male students) the average male student went on to earn less than peers. However, the report also points out that, typically, earnings growth for university leavers keeps growing faster after the age of 29, especially for men.
Many of the negative returns at 29 relate to courses or institutions that were already known to be exceptional cases such as creative arts subjects or specialist arts colleges.
But the data also show that even in subjects where earnings potential is emphasised – such as business studies – there were universities where students ended up earning less than peers who did not go into higher education. And both pre-92 and post-92 universities are among those where men go on to earn less on average at 29.
Meanwhile, the IFS report also finds that, without a mathematics or science A level, attending university only boosts the earnings of men with relatively low GCSE grades by about 4 per cent. Chris Belfield, a co-author of the report and IFS research economist, said that this had important implications because this group was among those who may not have gone to university when there were fewer places available.
“However, there are options for these students that do yield good positive returns: computer science and business degrees, for example, accept large numbers of lower prior attainment students, and have a big positive impact on their early-career earnings,” Mr Belfield said.
Mr Gyimah said that the data were “incredibly powerful” and claimed that the OfS was already challenging universities where courses were not up to scratch as part of their registration process.
“A breach of a registration condition by a university could lead to deregistration…that would be a serious sanction for a university,” he said.
Mr Gyimah added that he wanted the OfS to be “more active as a regulator” in terms of individual courses.
“There are levers that we are already using and that we can strengthen to make sure that we can crack down on [courses] that do not deliver full value for students,” he said.
At the same time though, Mr Gyimah also appeared to question the usefulness of data on 29-year-olds when asked if young people should reconsider taking on student debt for the returns on offer.
“I think it is simplistic to take a snapshot at aged 29. We are also aware that a snapshot at aged 29 doesn’t define someone’s entire life in terms of value for money. So I wouldn’t take a snapshot there.”