Tuition fees hike hit courses with low salary expectations: study

Researcher says findings indicate variable fees may be preferable

April 6, 2015

The introduction of £9,000 tuition fees in England had a greater negative impact on applications to courses that are likely to lead to poorly paid careers, new research suggests.

Filipa Sa, senior lecturer in economics at King’s College London, analysed the effect of the 2012 funding reforms on university applications and attendance compared with what would otherwise have been expected.

Her research, presented at the Royal Economic Society’s annual conference on 1 April, was based on Ucas statistics and used Scotland – where free tuition was maintained – as a control.

Dr Sa told the conference that the increase in fees had led to a reduction in applications by English-domiciled students in 2012-13 of between 18 per cent and 22 per cent.

The number of first-year undergraduates starting courses in 2012-13 shrank by between 17 and 27 per cent.

The data imply that a 1 per cent increase in tuition fees leads to a fall in applications of between 0.14 per cent and 0.23 per cent, Dr Sa said.

She added that the results varied by course according to expected employment prospects, with applications to courses predicted to lead to the lowest salaries falling by between 20 per cent and 28 per cent.

In contrast, applications to courses with the highest expected salaries post-graduation fell by between 10 per cent and 20 per cent.

Dr Sa told Times Higher Education that her research suggested that different fees should be charged for different courses.

“Perhaps fees should be higher for courses that lead to higher-paid jobs and lower for courses that are socially useful but don’t lead to very highly paid jobs,” she said.

Dr Sa also considered the impact of Scotland’s removal of upfront annual tuition fees of £1,000 in 2001, and their replacement with an endowment of £2,000 that was paid after graduation (a policy itself scrapped in 2008).

Using England as a control, she said that this reform – which amounted to a cut in the cost of tuition – led to an increase in applications of about 23 per cent.

Dr Sa said that her findings indicated that Labour’s policy of reducing tuition fees in England to £6,000 would lead to increased university applications and attendance.

But this would have to be weighed against the impact on public finances overall, she added.

An earlier version of Dr Sa’s research, “The Effect of Tuition Fees on University Applications and Attendance: Evidence from the UK”, has been published online.

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