|Practice area:||Economics of Education | Labour markets|
|Published:||16 July, 2019|
|Keywords:||2019 economics of education England labour market economics quantitative analysis|
London Economics were commissioned by the Gatsby Foundation to undertake an assessment of the net graduate premium and net Exchequer benefit associated with Higher Technical Education qualifications at Level 4 and Level 5.
- For full-time students, the analysis suggests that the net benefits to students undertaking specific STEM-based qualifications at Level 4/5 are substantial (and generally larger than the returns associated with non-STEM-based subjects). There are particularly high net graduate premiums achieved by males undertaking HNCs/HNDs in STEM-based subjects (£100,000 per student) and females undertaking HE Diplomas in STEM-based subjects (£57,000). The corresponding net benefits to undergraduate degree students in STEM-based subjects were estimated to be £166,000 and £106,000 for men and women, respectively.
- The internal rates of return achieved by men undertaking STEM-based HNCs/HNDs (24.8%) and women completing STEM-based HE Diplomas (16.6%). These compare to an internal rate of return of 19.5% and 17.1% posted by men and women undertaking undergraduate degrees in STEM-based subjects.
- Reflecting the general fact that part-time students tend to undertake their qualifications later in life, the net lifetime benefits accrued by these students are typically lower than the benefits to full-time students. However, again, we found that there are relatively high net graduate premiums accrued by men undertaking STEM-based HNCs/HNDs (£66,000 per student) and by women undertaking STEM-based HE Diplomas (£23,000). As with full-time students, these estimates are marginally smaller than the corresponding premium to undergraduate degree students in STEM-based subjects (£69,000 and £26,000 per male and female undergraduate student, respectively).
- Again, there are very substantial rates of return accrued by males studying STEM-based HNC/HNDs (25.3%) and females undertaking STEM-based HE Diplomas (13.0%). This compares to internal rates of return to undergraduate degree level students in STEM-based subjects of 15.1% and 10.2% for men and women, respectively.
The full report is available here.