Student debts wipe out most graduate pay premiums – report

BBC News is reporting that campaigners are claiming politicians should stop using a “carrot of higher graduate earnings” to justify raising student fees or freezing repayment thresholds.

Those who do “should be charged with gross mis-selling”, says Angus Hanton, co-founder of the Intergenerational Foundation (IF) lobby group.

Having to pay back student debts will wipe out any graduate premium for most professions, claims the IF in a report.

The government says higher education boosts employability and earnings.

The report focuses on tuition fee rises in England – currently capped at £9,000 a year – pointing out how successive governments have used the graduate “pay premium” to justify them.

The premium is the amount of extra money it is estimated a degree can help graduates to earn over the course of a lifetime.

The report says that in 2002, ministers put it at £400,000, but recent estimates have been more modest at about £100,000.

More: Student debts wipe out most graduate pay premiums – report

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  1. £100k over a working lifetime of 50 years works out at £2k a year.  Presumably tax would be paid on that.  So much for the ‘graduate premium’.

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