Are degrees in the UK value for money?

economic

NineDeuce wrote: »

Oh yes, the 'I cant answer that so will say go and read' response.

£9.5k for whole year vs £2k for a week. I hope that makes things crystal clear....

2k a week paid for by the employer and not the taxpayer unlike student loans. BIG difference. for the employer to pay that much for training obviously means its worth it unless they are stupid or doing it purely for political reasons.

its pretty simple really.

economic

adindas wrote: »

There is a serious problem with your assumption.
If you put £100,000 today into stock market in today money before the end of the day it is still £100,000, is not it ??

I believe you are talking about future in 48 years time.
You get the result of £1.04 million (or whatever) based on 5% in 48 years time. It might be misleading for people who do not understand about inflation the value of future money in today money equivalent.

Supposed the RPI was 5% than the purchasing power of the money of £1.04 million in 48yrs time is still the same with £100,000 today. I am aware that RPI is about 3.5% but just do not bother to calculate it as the figure is definitely misleading for people who do not understand about the inflation and stock market.

Also keep in mind that there is no guarantee you will get an average return of 5%. I lost about 20% of the value of my share when I had to sell it as I need money due to unforeseen circumstances. I fully believe reasonable number of people also lost money in the stock market.

For the youngster who do not even know the subject to read at uni they might loose all of the mosey invested in the stock market. The money might loose in the dodgy pump and dump scheme in the stock market thinking they could become a sudden millionaire by investing in share from the money they get from their dad.

If they are too dumb to choose which subject to read at university which will have a much greater chance to make them better in the future, how could you expect them to make money in the stock market. They might end up using it for day trading, spread betting, swing trading in the stock market. Worse they might just spend it for partying, drinking, getting drunk, gambling,

Education is the best gift you could give to your children, just do not let them choose they subject just because they fancy it, they like, it is easy to get. If this is what they wanted ask them to earn something and pay by themselves.

This is also the video from Billionaire Peter Thiel together with Charles Murray. While they mention that higher education is a disaster they still give the exception for the subject like Math, Science, Engineering. I fully believe they just forget to mention the subject like Medicine or dentistry

https://www.youtube.com/watch?v=IvBlOFU3ry8

thats why he said real terms, its the return above inflation.

theres a difference between useful education that trains people to enter into a career that requires either the skillset or way of thinking, and useless education where you learn about a subject thats maybe has 10% use in it. is the 30k+ debt worth it for that small amoun tof knowledge/skills gained? there is certainly a more efficient and less wasteful way to go about proper education. having a degree for the sake of it is really ignorant.

GreatApe

adindas wrote: »

There is a serious problem with your assumption.
If you put £100,000 today into stock market in today money before the end of the day it is still £100,000, is not it ??

I believe you are talking about future in 48 years time.
You get the result of £1.04 million (or whatever) based on 5% in 48 years time. It might be misleading for people who do not understand about inflation the value of future money in today money equivalent.

Supposed the RPI was 5% than the purchasing power of the money of £1.04 million in 48yrs time is still equivalent £100,000 today. I am aware that RPI is about 3.5% but just do not bother to calculate it as the figure is definitely misleading for people who do not understand about the inflation and stock market.

I was talking about a real return of 5% above inflation which would be obtained either by buying a house or by putting it into the stock market. If anything this 5% is probably conservative for stocks and shares but perhaps about right for homes.

Also keep in mind that there is no guarantee you will get an average return of 5%. I lost about 20% of the value of my share when I had to sell it as I needed money due to unforeseen circumstances. I fully believe reasonable number of people also lost money in the stock market.

Long term investing will see a positive return

For the youngster who do not even know the subject to read at uni they might loose all of the mosey invested in the stock market. The money might loose in the dodgy pump and dump scheme in the stock market thinking they could become a sudden millionaire by investing in share from the money they get from their dad.

Dont invest in single shares invest in a large number via a low cost tracker. Or buy a house that too will give you a real 5-6% annual return

If they are too dumb to choose which subject to read at university which will have a much greater chance to make them better in the future, how could you expect them to make money in the stock market. They might end up using it for day trading, spread betting, swing trading in the stock market. Worse they might just spend it for partying, drinking, getting drunk, gambling,

universities only play a very small part in increasing someones intelligence possibly none at all. If you feel otherwise find me a single study were a university takes a large group of people with an IQ of 100 and at the end of 3 years their IQ is 120 I dont think you are likely to find such a study

Education is the best gift you could give to your children, just do not let them choose they subject just because they fancy it, they like, it is easy to get. If this is what they wanted ask them to earn something and pay by themselves.

By the time a kid is 18 their intelligence and character is more or less fixed.
Education, aka information, is more or less free now with the internet

How much money they will make in 48 years time if after becoming a dentist they earning 50k equal to £4167 pm in today money (say) and keep increasing and due to promotion and salary inflation adjustment ??

What you dont understand or appreciate is that collectively universities cant take half the population and increase their incomes by anything more than a trivial amount. If that was not the case we would have been it in the GDP numbers over the last decade. Record numbers into university but productivity is more or less the same.

The reason is we need a certain number of professions. For instance we need about 200,000 doctors in this country. But lets say we trained 100% of all the students as doctors and they all passed with flying colors. That would mean we would have something like 20 million doctors but we only need 0.2 million doctors hence 99% of those you train could not become paid doctors.

So while you can look at universities and say ahhh look doctors earn more thanks to their education that really means nothing.

What you should do is look at a large group of kids going to university, say 10,000 and look at 10,000 not going to university and standardize other factors like IQ and consciousnesses and see how the two groups fair. If you did that you would find that there is only a tiny increase in later life income for the group with the degree vs the comparables without the degrees so much so that the 3-4 lost years of earnings and £50k in debts would never bridge the gap

This doesnt even take into account that earned income is taxed while investment generally isnt (ISA/House) which would make gap even larger

Based on this calculator solely based on 3.5% based on inflation i got £6,236,422.51 in 49 years time. I have not counted that during their career they might be getting a promotion doubling their salary during their career.

wages will increase but likely not much more than 1% above inflation so a dentist working 48 years at £50k a year will get something like £36.8k post tax income x 48 years compounded 1%

The main consideration is that what would someone who is as smart and capable as a dentist be doing if they had not gone to university? stacking shelves in tesco? probably not. They would be earning more than the average person irrespective of going to university or not. Also a dentist takes about 6 years to become a dentist so that means a larger loan and more time off earning

This is also the video from Billionaire Peter Thiel together with Charles Murray. While they mention that higher education is a disaster they still give the exception for the subject like Math, Science, Engineering. I fully believe they just forget to mention the subject like Medicine or dentistry

Science maths and engineering are the worst of all the subjects to study in that none of it will be applicable to your future life or work. The majority of my school friends did those subjects and none of them work in a field that requires their university education. They are all well paid because they are smart people but the university didnt make them smart they were smart pre university. If employers like investment banks and private equity took on 18 year olds with high A-Level grades in subjects like Maths Further Maths Physics Chemistry etc etc and they took on 1st/2nd Class Grads in Engineering/Science/Maths I would wager they would get more or less the same output from the two groups and should thus be paid the same. That is to say if there is any value in the degree its the value of discriminating against exactly the same people with the same skill and IQ but one got a piece of paper that says university of x and the other one only have a paper that says Edexcel

University education in some ways is basically a very very expensive and time consuming IQ test

GreatApe

Having said that I think public schools can be good value for money (if you are rich enough) because the kids at age 4-5-6 maybe all the way to puberty are still forming their characters and brains. Its not so much the higher quality education you are buying but the higher quality surroundings and things like lower violence and more clam classes and better discipline

I suppose in some ways that too is true of university, as I said earlier if your only option is a life on minimum wage and maybe getting involved in gangs or drugs then go to university spend 4 years there if nothing else its a better environment than your alternative and you are 4 years closer to retirement by the end of it.

That actually brings up an interesting option for older people....apparently if you are age 60 or under on the first day of your course you get tuition and maintenance grants of upto £10k a year. Take on a masters degree in photography or art or some such at age 60 and let the government pay you £10k a year to study it. You would never need to pay any of it back so long as your pension is below £25k a year. 4 years in later life taking on a hobby university course sounds a whole lot better than working in a warehouse.

adindas

Gozz
The problem here is that too many people think that they are smarter than what they should be.

You could claim what you want but before it has been tested, by professional with superior knowledge, it is absurd.

What is for certain here is that the company like PWC, KPMG, HSBC or other investment bank, Airbus, Boeing, BAE, Atkins, AECOM etc will not stupid to hire a graduate paid a higher salary if they could easily hire a people with the same result but lower salary; the people without a degree self proclaiming themselves that they are the same or better than a graduate.

GreatApe wrote: »

I was talking about a real return of 5% above inflation which would be obtained either by buying a house or by putting it into the stock market. If anything this 5% is probably conservative for stocks and shares but perhaps about right for homes.

Long term investing will see a positive return

Dont invest in single shares invest in a large number via a low cost tracker. Or buy a house that too will give you a real 5-6% annual return

universities only play a very small part in increasing someones intelligence possibly none at all. If you feel otherwise find me a single study were a university takes a large group of people with an IQ of 100 and at the end of 3 years their IQ is 120 I dont think you are likely to find such a study

By the time a kid is 18 their intelligence and character is more or less fixed.
Education, aka information, is more or less free now with the internet

What you dont understand or appreciate is that collectively universities cant take half the population and increase their incomes by anything more than a trivial amount. If that was not the case we would have been it in the GDP numbers over the last decade. Record numbers into university but productivity is more or less the same.

The reason is we need a certain number of professions. For instance we need about 200,000 doctors in this country. But lets say we trained 100% of all the students as doctors and they all passed with flying colors. That would mean we would have something like 20 million doctors but we only need 0.2 million doctors hence 99% of those you train could not become paid doctors.

So while you can look at universities and say ahhh look doctors earn more thanks to their education that really means nothing.

What you should do is look at a large group of kids going to university, say 10,000 and look at 10,000 not going to university and standardize other factors like IQ and consciousnesses and see how the two groups fair. If you did that you would find that there is only a tiny increase in later life income for the group with the degree vs the comparables without the degrees so much so that the 3-4 lost years of earnings and £50k in debts would never bridge the gap

This doesnt even take into account that earned income is taxed while investment generally isnt (ISA/House) which would make gap even larger

wages will increase but likely not much more than 1% above inflation so a dentist working 48 years at £50k a year will get something like £36.8k post tax income x 48 years compounded 1%

The main consideration is that what would someone who is as smart and capable as a dentist be doing if they had not gone to university? stacking shelves in tesco? probably not. They would be earning more than the average person irrespective of going to university or not. Also a dentist takes about 6 years to become a dentist so that means a larger loan and more time off earning

Science maths and engineering are the worst of all the subjects to study in that none of it will be applicable to your future life or work. The majority of my school friends did those subjects and none of them work in a field that requires their university education. They are all well paid because they are smart people but the university didnt make them smart they were smart pre university. If employers like investment banks and private equity took on 18 year olds with high A-Level grades in subjects like Maths Further Maths Physics Chemistry etc etc and they took on 1st/2nd Class Grads in Engineering/Science/Maths I would wager they would get more or less the same output from the two groups and should thus be paid the same. That is to say if there is any value in the degree its the value of discriminating against exactly the same people with the same skill and IQ but one got a piece of paper that says university of x and the other one only have a paper that says Edexcel

University education in some ways is basically a very very expensive and time consuming IQ test

Sapphire

economic wrote: »

thats why he said real terms, its the return above inflation.

theres a difference between useful education that trains people to enter into a career that requires either the skillset or way of thinking, and useless education where you learn about a subject thats maybe has 10% use in it. is the 30k+ debt worth it for that small amoun tof knowledge/skills gained? there is certainly a more efficient and less wasteful way to go about proper education. having a degree for the sake of it is really ignorant.

Just to say that I didn't go to university and that in no way stopped me from being successful. I did loads of 'low-level' jobs of different kinds, initially for 6 months or thereabouts (PA work, shoe shop assistant on Saturdays, hospital clerical job, working in a pub in the evening, job in company selling antiques and British goods to America, advertising work, etc.). All were useful and fun. Then I hit on publishing in a junior position, and worked my way up from there because I found books and the publishing milieu so interesting. I've never regretted for one minute not going to university and think that for many jobs the best training is on the job. The key thing (I've found) is to be interested in the job and the people around you, and to commit and work hard. (In fact, I applied this principle even to the 'low-level' jobs I initially did, and was often asked to stay when I decided to leave them.)

It's a different matter when it comes to some subjects, of course. Degrees are essential for professions in things like medicine, science and so on.

I did eventually get a degree, done in my spare time for interest, and paid for it with no grants – but I didn't do this until my career was well established.

In my view, there should be apprenticeships for many jobs – learning on the job is just so much more productive than taking degrees in subjects that serve only to raise people's expectations but don't result in successful work (or even any work).

GreatApe

If university was delayed by 2 years so people started age 20 instead of 18 I think that might have an impact on the numbers. The vast majority of the kids would have got jobs in those two years so by age 20 it would be a choice of staying with their job or going to university rather than the current option at 18 which is go to university or look for work which can be a daunting idea for some. My guess would be that maybe half of the kids that currently go to university would decide it was unnecessary.

In fact if the numbers were cut in half, the half that decided to go could go for free (assuming that currently half the debt needs to be written off) so it would be a win win and the only cost is a 2 year delay which the kids could use for work or travailing or even self study or improving upon their A-Levels

GreatApe

adindas wrote: »

Gozz
The problem here is that too many people think that they are smarter than what they should be.

You could claim what you want but before it has been tested, by professional with superior knowledge, it is absurd

Were not MPs discussing policy and the future of the country just somewhat interested amateurs so speculation and guesswork is all good

Sapphire

GreatApe wrote: »

If university was delayed by 2 years so people started age 20 instead of 18 I think that might have an impact on the numbers. The vast majority of the kids would have got jobs in those two years so by age 20 it would be a choice of staying with their job or going to university rather than the current option at 18 which is go to university or look for work which can be a daunting idea for some. My guess would be that maybe half of the kids that currently go to university would decide it was unnecessary.

I'd also say that as a school leaver, I had no idea what I wanted to do in life – at that time I basically wanted to enjoy life, though I also enjoyed being productive and appreciated at work. I didn't really become invested in a career until I was past my mid-twenties.

Perhaps many teenagers decide to go to college as a means of 'enjoying life', and take subjects that are considered trendy at the time? Seems like the wrong and pretty pointless reason for going on to further studies.

adindas

GreatApe wrote: »

If university was delayed by 2 years so people started age 20 instead of 18 I think that might have an impact on the numbers. The vast majority of the kids would have got jobs in those two years so by age 20 it would be a choice of staying with their job or going to university rather than the current option at 18 which is go to university or look for work which can be a daunting idea for some. My guess would be that maybe half of the kids that currently go to university would decide it was unnecessary.

In fact if the numbers were cut in half, the half that decided to go could go for free (assuming that currently half the debt needs to be written off) so it would be a win win and the only cost is a 2 year delay which the kids could use for work or travailing or even self study or improving upon their A-Levels

What prevent the youngsters to take gap years, do whatever they want or work wherever they want.

What is for certain here is that the company like PWC, KPMG, HSBC or other investment bank, Airbus, Boeing, BAE, Atkins, AECOM etc will not stupid to hire a graduate paid a higher salary if they could easily hire people with the same result but lower salary; random people without a degree self proclaiming that they are the same or better than a university graduate.

It is even cheaper of they could recruit an A-level without the need for further education at the university with the same result.

Many of the companies including the large companies I mention above giving bursary to university as the recognition of the university contribution filling their need for graduate.

Many of the companies are sending their employees to study on part time one day release basis.

How come they give bursaries sending their employers to study at the universities if they do not get out of it in return.