Education and Skills Impact Framework (ESIF) - university provision: contextual summary report 2022

Conclusion and discussion

• The return on investment for all university qualifications are high for both the qualifier and the Scottish exchequer. In general, returns are higher for men than for women. It may be tempting to attribute this to differences in subject choice, however similar research using LEO data in the rest of the UK has identified large differences in expected lifetime earnings between men and women studying the same subject (Britton, Dearden, Van der Erven, & Waltmann, 2020).
• Returns on Investment for postgraduate research qualifications are positive, with the Exchequer benefitting to a greater degree than individuals. The disparity in returns between men and women is especially large at this level, with the estimated return to the Exchequer from men more than 3x as large as for women.
• First degree qualifications are associated with a substantial return on investment, although foregone earnings lead to a reduced benefit to cost ratio. Returns are generally greater for individuals than the Exchequer. It is not possible to comment on the true return on investment to a first degree as differences in academic ability and reasons for continuation/ discontinuation are not included in the estimation process.
• Completing a postgraduate taught qualification is associated with a large ROI and benefit to cost ratio (BCR) for both individuals and the Exchequer. Costs of studying postgraduate taught qualifications are generally borne by the individual, with a loan available from SAAS to cover upfront costs. It is not currently possible to comment on how much of these estimated returns reflected differences in academic ability or other characteristics between postgraduate qualifiers and first- degree qualifiers.
• All findings should be considered with mind to the notes made in the consideration section. Results should not be considered as causal, any results presented are in reference to the typical learner present in the data.
• Any potential future research should consider the inclusion of prior-academic attainment in estimating returns to qualifications at university. This data is available for a large portion of the Scottish University population and would allow for a more rigorous analysis of the relationship between higher education qualifications and labour market outcomes. Any future research may be best directed at understanding the drivers behind estimated returns for postgraduate qualifications, including methods that might control for selection into further study.