"Universities have simply taken on the role of an extremely expensive recruitment process"
The British government, in introducing the new doctoral loans offered to graduates aiming for a PhD, have sent out a message - “PhDs are valuable”. This stinks of the same misguided and ill-considered ambition of Tony Blair, who, almost 20 years ago set out his grand ambition to have at least half of the entire young population of Britain entered into higher education by 2010. In a feat of remarkable cross-party agreement, that goal was reached, and yet the UK is not better off for it. According to the Chartered Institute of Personnel and Development, 58.8% of UK graduates end up in non-graduate jobs, and around 1 in 12 of those are working in low skilled jobs. It’s estimated that 45% of graduates will never earn enough to repay their fees, and yet universities and politicians continue to sell university education like it’s a guaranteed ticket to the land of employment and job satisfaction.
In a classic example of the importance of balance between supply and demand, the increased supply of graduates has forced employers to raise the bar, requiring higher and higher levels of qualifications to filter for the same talent. In fact, there’s a notion called signalling theory which suggests the only point of a university degree is to signal to an employer that a graduate is capable of getting into a certain level of university, and then getting out again, without actually learning anything that couldn’t be learnt from 4 years on the job. The conclusion is that universities have simply taken on the role of an extremely expensive recruitment process - very much hyperbole in my opinion, but it highlights the problem in encouraging an overabundance of graduates.
A backlash has certainly emerged, with many politicians realising that higher-education is not the best place for even the majority of young people, and there’s been a concerted movement towards modelling our education system on countries like Germany, which has a rate of young people going into higher-education of only 30%. In Scotland, the Tory and SNP leaders have both expressed ambitions to encourage alternatives to vanilla, university-focused higher education, like apprenticeships. So why has the government decided to force the bar even higher by facilitating a potentially disastrous increase in the numbers of graduates with highest qualification available, a PhD?
The loans themselves are lacklustre. Government-backed, the loans, given in regular payments spread across the expected completion time of the PhD, usually about 3-4 years, are offered to doctoral candidates who haven’t otherwise secured funding. This is much like the student loans offered to undergraduates. The total amount available, however, is £25,000. After subtracting fees, the amount left over could be £10,000, meant to sustain a person for 3 whole years (at least).
True, to an individual there could be a nice bump in eventual earnings. In fact, according to Vitae, 3.5 years after graduating, 72% of PhDs will be earning over £30,000, while only 22% of 1st class undergraduate degree holders are in the same bracket, and masters coming in at 56%. Getting a masters degree, then, might turn out to be enough. Researcher Bernard Casey found that male PhDs earn 26% more than those without a degree at all, while that figure for masters degree holders is a slightly lower 23%. The difference for women is even smaller, and the difference specifically for those with arts PhDs is nearly non-existent. Is this potentially small difference worth the extra £25,000 in loans needing repaid? Particularly if that’s coupled with 3-4 years out of the job market, the stress of actually doing the PhD, and the extra money required to even stay alive and fed, which could not possibly come from any part-time work - there’s simply not enough time.
It’s admirable the government is willing to support those who want to study for a PhD and haven’t managed to acquire funds. The funding is meagre however, and will be useful only to those students who nearly have the savings to self-fund the degree. My worry is that this is yet another attempt to ill-advisedly encourage more students to get degrees they don’t need, further fueling the madness of our oversaturated higher education system.