The Institute for Fiscal Studies has estimated that medicine graduates in the UK can expect to earn up to £400,000 more over their lifetimes than comparable non-graduates, according to research highlighted in a BBC report this week that also flags negative returns for some subjects. Economics degrees similarly deliver strong premiums while creative arts, philosophy and languages often do not, prompting the Department for Education to prepare caps on low-value courses. On average, a degree boosts net lifetime earnings by around £100,000 after taxes and repayments, although a quarter of degree holders are projected to be financially worse off, the analysis of a 2002 GCSE cohort shows.
The findings, drawn from linked education and tax records for England-domiciled students born in the mid-1980s, reveal substantial heterogeneity in outcomes. According to the IFS, men who studied creative arts or social care face strongly negative average returns while those in medicine or economics average around £500,000 net of taxes and loans using standard discounting. For individuals with lower GCSE grades who nonetheless pursued higher education, the average uplift is £53,000 but four in 10 men in that group are expected to lose out financially.
A Resolution Foundation analysis published in January 2025 revisited the same underlying Longitudinal Education Outcomes data and concluded that using a lower 0.7 percent discount rate produces larger estimated premiums of £280,000 for men and £190,000 for women. The think tank’s report noted that young graduates currently enjoy an annual earnings advantage of approximately £5,000 over non-graduates, although this gap has narrowed from a decade ago as non-graduate wages have been supported by minimum wage increases. It emphasised that graduates remain far more likely to be in employment, adding a further dimension to the value of a degree beyond raw pay.
The Department for Education has indicated it will move to restrict recruitment to programmes that repeatedly demonstrate weak labour-market outcomes for students. Skills minister Jacqui Smith stated that prospective undergraduates should choose carefully and not walk into a degree by default. She added that going to university and getting a degree is one of the most transformational things a young person can do but it is not a universal guarantee of success and not all degrees are equal.
Nick Harrison, chief executive of the Sutton Trust, told the BBC that while university is not a guarantee of financial success it remains the most reliable route to upward mobility, particularly for those from lower-income families. Most graduates continue to see big financial benefits over their lifetimes, and for young people from lower-income backgrounds those gains are often greatest, Harrison said. He posed the challenge that criticism of low-value degrees must be matched by expansion of high-quality apprenticeships and technical education routes, which currently fall short of demand.
Vivienne Stern, chief executive of Universities UK, cautioned against judging all subjects purely on earnings and pointed to the broader economic role of creative disciplines. We should recognise that these subjects also feed the creative industries, which are a huge economic driver for the UK, Stern said. She noted that with the rise of artificial intelligence, skills in understanding human thought and behaviour may grow in importance rather than diminish. An earlier OECD comparison placed average UK net lifetime returns at roughly $250,000 for men and $200,000 for women, consistent with the domestic estimates.
More up-to-date graduate labour market statistics released by the Department for Education for the 2022-23 tax year continue to show medicine, economics, engineering and computing among the highest-earning fields five years after graduation. Earlier linked studies indicate that Russell Group institutions produce graduates with average earnings around 10 percent higher than the sector mean even after controlling for student background. The IFS authors nevertheless stressed that their projections involve assumptions about future earnings trajectories and that non-financial benefits of higher education, such as improved health outcomes, are not captured in the financial returns.
