Going to university is not what it once was - and students face a very different question

For around 700,000 teenagers on the treadmill that is the English education system, the A and T-level results that drop this week may be the most important step of all.

They matter because they open the door to higher education, and a crucial life decision based on an unwritten contract that has stood since the 1960s: the better the marks, the greater the choice of institution and course available to applicants, and in due course, the value of the degree at the end of it. A quarter of a century after Tony Blair set a target of 50% of school-leavers going to university, however, the fundamentals of that deal have been transformed.

Today's prospective undergraduates face rising costs of tuition and debt, new labour market dynamics, and the uncertainties of the looming AI revolution. Together, they pose a different question: Is going to university still worth it? Huge financial costs Of course, the value of the university experience and the degree that comes with it cannot be measured by finances alone, but the costs are unignorable.

For today's students, the universal free tuition and student grants enjoyed by their parents' generation have been replaced by annual fees that increase to £9,500 this year. Living costs meanwhile will run to at least £61,000 over three years, according to new research.

Together, they will leave graduates saddled with average debts of £53,000, which, under new arrangements, they repay via a "graduate tax" of 9% on their earnings above £25,000 for up to 40 years. A squeezed salary gap As well as rising fees and costs of finance, graduates will enter a labour market in which the financial benefits of a degree are less immediately obvious.

Graduates do still enjoy a premium on starting salaries, but it may be shrinking thanks to advances in the minimum wage. The Institute of Student Employers says the average graduate starting salary was £32,000 last year, though there is a wide variation depending on career.

With the minimum wage rising 6% to more than £26,000 this April, however, the gap to non-degree earners may have reduced. A reduction in earning power may be compounded by the phenomenon of wage compression, which sees employers having less room to increase salaries across the pay scale because the lowest, compulsory minimum level has risen fast.

Taken over a career, however, the graduate premium remains unarguable. Government data shows a median salary for all graduates aged 16-64 in 2024 of £42,000 and £47,000 for post-graduates, compared to £30,500 for non-graduates.

Graduates are also more likely to be in employment and in highly skilled jobs. There is also little sign of buyer's remorse.

A University of Bristol survey of more than 2,000 graduates this year found that, given a second chance, almost half would do the same course at the same institution. And while a quarter would change course or university, only 3% said they would have skipped higher education.

No surprise then that industry body Universities UK believes the answer to the question is an unequivocal "yes.