Graduate salaries in the UK have become a hot topic, as new data reveals that pay for university leavers is not keeping up with inflation. According to the Resolution Foundation, the median graduate salary in 2023 was £34,200, which is actually lower than £35,600 in 2001 when adjusted for inflation. In contrast, the national minimum wage has risen by nearly 60%, reaching £21,700.
This gap between graduate salaries and the minimum wage is raising serious concerns about the true value of a degree in today's job market. What was once considered a key to financial success is no longer delivering the expected return for many graduates.
A Shift in Career Expectations
For years, a university degree was seen as a stepping stone to higher salaries and better job prospects. But this is no longer the case for many students. Across sectors that used to guarantee higher earnings, like law, finance, and engineering, salaries are stagnating. In fact, some graduates are now finding themselves in positions that don’t require a degree at all, or in jobs that pay no better than the national minimum wage.
The fact that graduates in fields once known for high-paying roles are struggling to earn a decent wage highlights a significant shift in the job market. The promise of better career prospects post-graduation is being questioned, as many graduates are now left with little financial reward for the years of study they’ve invested.
The Growing Burden of Student Debt
One of the biggest concerns for new graduates is the increasing level of student debt. In 2023, tuition fees remain at £9,250 a year for UK students, with additional costs for living expenses, accommodation, and materials. This has left many graduates with debts in the tens of thousands of pounds, which they now have to repay on low salaries.
The combination of stagnant wages and high student debt is putting an increasing number of graduates in a financially precarious position. For many, the dream of using their degree to build a secure future is at risk as they struggle to make ends meet while paying off their loans.
What Are Experts Saying?
The Resolution Foundation, which published the findings, has called for an urgent review of the UK’s higher education system. Experts from the Foundation are calling for changes to how universities prepare students for the job market, with more emphasis on practical, industry-specific skills. They argue that universities must ensure students are ready to meet the demands of today’s workforce, not just armed with theoretical knowledge.
There is also a growing call for the government to reconsider the current system of tuition fees and student loans. With many graduates now facing years of financial struggle, critics argue that the cost of higher education is too high, and the debt burden too severe, given the limited financial return.
The Impact on Social Mobility
The stagnation of graduate wages is not only an economic issue—it’s a social one. Higher education has long been a tool for social mobility, helping individuals from disadvantaged backgrounds access better career opportunities. However, if degrees no longer offer a financial return, this risks undermining the very purpose of higher education.
As wages for graduates shrink and student debt grows, young people from all backgrounds are facing an increasingly difficult road to financial independence. If the value of a degree continues to decline, it may become a luxury reserved only for the wealthier segments of society, which could further widen the inequality gap in the UK.
A Call for Change
With rising concern over the stagnation of graduate wages, the cost of higher education, and the increasing financial strain on young people, it’s clear that change is needed. Universities, employers, and the government must work together to ensure that degrees continue to offer real value—not just in terms of knowledge, but in terms of financial return.
As universities and the government grapple with how to fix the issue, students and recent graduates are beginning to speak up. Many are calling for a reduction in tuition fees, better support for those entering the job market, and a fairer deal on student loans.
The future of higher education in the UK hangs in the balance. If change doesn’t happen soon, we may see a growing number of graduates questioning whether the price of a degree is truly worth it.
News Desk