Kevin Gilmartin explores the findings of a major House of Lords report on Treating Students Fairly that looks into the economics of post-school education.

What lies beyond?

What is behind the report?

Those who have worked in schools and colleges are constantly hoping that we have prepared our sixth formers properly for the next phase in their education and training when they leave. Successive governments have pursued and encouraged the expansion of higher education (HE). These efforts have succeeded: in the 1960s, 5% of young people went into HE; today, about 50% do. And their options are plentiful, with thousands of different types of degrees and diplomas, hundreds of universities and further education (FE) colleges, and the choice of studying full-time, part-time or as part of an apprenticeship.

Yet, despite this variety, one form of study has dominated: as the chart below shows, growth in HE during the 21st century has been almost entirely as a result of full-time undergraduate degrees. By contrast, the number of students at Levels 4 and 5 (L4/5) have declined, and there has been an 88% reduction in enrolments at the Open University (OU) over that period. There has also been a decline at Level 3 (L3), largely via FE, resulting in the UK having fewer people without a qualification at L3 than in most similar countries.

So, within this context the House of Lords wanted to answer the question, “Is the continued expansion of undergraduate degrees the best outcome for graduates and the economy?”

The report’s conclusion

The answer was almost certainly not. They found that many graduates appear to be in jobs that do not require a degree while at the same time many businesses are reporting skills shortages, particularly at technician level. This suggests that in terms of labour market outcomes at least, some graduates may have been better off considering other HE qualifications that were cheaper, shorter and more relevant to the workplace. They then asked, “Why then are people continuing to pursue undergraduate degrees if future employment benefits are uncertain?”

The main cause here, unsurprisingly, is the prioritisation of the A level/ university route, resulting in a ‘monoculture’ that has developed around the “primacy of the undergraduate degree which has crowded out other options which are perceived as inferior”. Other reasons include:

• lack of a single, UCAS-style, portal – that includes all forms of apprenticeships and study options
• the paucity of information available to young people – particularly around apprenticeships
• the incentivisation of schools to send pupils down the academic route – for school performance tables reasons or just for the kudos that parents demand
• employers requiring degrees for jobs that do not need them
• the 2012 reform of university financing – which has resulted in government grant funding being replaced by tuition fees, incentivising universities with the funding following the student

Recommendations

The key recommendations were around reforming funding to encourage part-time and flexible learning (especially given our changing economy, which will increasingly require people to re-train).

To assist with this, there should be a single regulator for all HE at L4 and above and a single FE regulator for other post-school education (L3 and below).

The committee was also very critical of the government’s target of three million apprenticeships – “the prioritisation of quantity over quality” – and is calling for it to be scrapped. It also called for the recently formed Institute for Apprenticeships (IfA) to be abolished, with the responsibility for the quality and outcomes of apprenticeships being divided between the new FE regulator (L2/3) and the Office for Students (OfS) (L4).

The financial cost

There is a major concern with the way that student loans are treated in national accounts, which masks the amount of public subsidy in HE. About half of the value of student loans currently issued will never be paid back, but these write-offs will not appear in the national deficit for more than 30 years. Worryingly, the Office for Budget Responsibility (OBR) estimated in January 2017 that the student loan book would be worth 11% of gross domestic product (GDP) in the late 2030s, an increase from about 5% now.

So what next?

The extent to which the report’s conclusions are adopted as part of government policy is of course unknown. However, perhaps this does highlight that the time has come for a pause in the continual rise of the traditional HE degree and for there to be a real push in alternative routes and options. To paraphrase the report title, “Are we really treating our students fairly otherwise?”

Find out more

Download the full House of Lord’s report here https://tinyurl.com/yaj5o32c

Kevin Gilmartin
ASCL Post-16 and Colleges Specialist
@ascl_uk

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