§ Mr. Alan WilliamsTo ask the Secretary of State for Education and Skills (1) what the(a) upper and (b) lower parameters are of Government estimates of extra life-time earnings of graduates; [140797]
(2) whether Government estimates of extra lifetime earnings of graduates differentiate between (a) different subjects and (b) different professions; [140800]
(3) whether Government estimates of graduates extra life-time earnings differentiate between male and female graduates. [140798]
§ Alan JohnsonHigher education is undoubtedly a good investment for the average graduate. Individuals with higher education qualifications earn on average around 50 per cent, more than those without. Separate analysis of the benefits of higher education estimates that first degree graduates earn on average around £120,000 more—in present value terms—over their working lives than those with two or more A-levels1. This estimate is technically different from the 50 per cent, graduate premium because it controls for background factors that affect earnings, independently of the qualification itself.
No specific estimates have been made of the extra lifetime earnings of graduates by degree subject, profession or gender. However, other studies suggest that there will inevitably be some variation in the lifetime differential because graduate earnings are influenced by a number of factors, including subject studied and occupational choices, which in turn may differ by gender.
1The 50 per cent, graduate earnings premium is derived by dividing the raw average earnings of those with first or sub-degrees by the average earnings of non-graduates. The £120,000 differential is derived by constructing a lifetime earnings stream for first degree graduates and comparing it against the lifetime earnings of A-level holders. Both earnings streams are discounted, adjusted for real earnings growth and other factors affecting earnings, other than the qualification itself. The difference between the two earnings streams sums to £120,000.