Apprenticeship vs Degree - Which route for success?

Posted: 29th of October 2017 by Miro Demo

"The days of degree or bust are long gone. There are alternative ways into the workforce these days. Absolutely I would say to my own kids to consider them." The words of a successful business person who never went to uni? Motivation from an educator encouraging their charges to look at all routes post-school? Maybe the musings of a celebrity parent whose children are nearing the flying-the-nest stage?

Nope. This was the government's Higher Education Minister, Jo Johnson, speaking back in July 2017. He went on: "They (apprenticeships) are valued by employers and we want to make sure they have the same esteem in society the classic honours degree has had." Blimey! Note, too, that Mr Johnson's special remit is UK universities.

No doubt we can partly attribute the minister's comments to the government's strategy to push apprenticeships and vocational training, which is backed up by a very large chunk of funding and its launch of the Apprenticeship Levy. Nonetheless, these are encouraging words for those of us on the 'Not Going to Uni' side of the fence and we are happy to publicise them here on our blog.

Last week (October 23rd 2017) the Daily Mail ventured into the vexed question of Apprenticeship vs Degree with a classic tabloid piece designed to provoke and stimulate. Check out the Headline:

"Apprentice electrician Marcus drives a Mercedes and expects to earn £50,000 by his mid-20s. Graduate Ashley can't afford petrol and relies on Mum and Dad for rent..."

It seemed to work; as we write today the article has had over 8,500 shares and generated 2,000+ comments. But beyond the sensationalist headline, and the fair criticism made by some of the commenters that maybe the journalist was comparing apples and oranges, there are some very interesting facts within the article that cannot be ignored. Let's list some of them out:

  • Marcus and Ashley are real people and these are real life case studies. Marcus is 21, completed a 4-year apprenticeship in electrical installation at Bury college and now earns £27,000 a year. Ashley is 22, graduated with a 2:1 in performing arts from the University of Sunderland and has not yet secured full-time employment.
  • Marcus did require support from his parents during his course and still lives at home with them, but crucially he is debt free and well on his way to having enough money to take his first step on the property ladder. Ashley meanwhile has £31,000 of debt and relies on mum and dad to help out with the rent.
  • Marcus had to work hard on low wages before reaching his current trajectory. He started on £2.64 an hour, rising to £6.20 an hour by the end of the apprenticeship. He says: "I was too tired to go out after work. I felt I was missing out, but I matured and adapted quickly."
  • Marcus did choose a sector (skilled trades) which, due to shortages, is in high demand, whereas Ashley chose the performing arts and this is a profession notorious for instability.
  • As Marcus admits, one reason he is earning more is simply that he's been in the workplace longer. Someone like Ashley is only just starting, so even had she had secured full-time employment by now it would likely be at a lower wage rate.

This last fact is important, because when taken in aggregate, figures do show that graduates will earn more over a lifetime than non-graduates. Graduates may start behind, but their pay levels do eventually catch up and then overtake non-grads, and this is one of the key points used by those arguing in defence of the university route.

However, even on this point the picture is mixed. Below we will list out some stats and facts taken from the Office for National Statistics (ONS) and other sources and you can decide where the truth lays:

  • The proportion of graduates in the UK workforce is now 38% (up from 17% in 1992). If you don't have a degree you are competing with lots who do.
  • Average debt for University leavers is £44,000 - ouch!
  • At age 21, graduates earn on average £14,000 p.a. while apprentices on average are at £17,000 p.a.
  • On average, earnings for those educated to GCSE level will plateau at age 32 at £19,000 p.a., for those educated to A Level at age 34 at £22,000 p.a., for graduates at age 38 at £35,000 p.a.
  • The Sutton Trust did a study that found top apprentices will earn almost £52,000 more over a lifetime than graduates from non-elite universities. (The study also noted that the earning potential of an advanced apprenticeship at level 3 is slightly better than that of someone whose highest qualification is at A-level).
  • What you study counts: Media Studies graduates average £21,000 p.a., Arts graduates average £22,000 p.a., Business & Finance graduates average £30,000 p.a., Medical graduates average £46,000 (all figures for 5 years after graduation).
  • Where you study counts too: Law degree from the LSE? After 5 years median earnings were £26,000 p.a., Law degree from University of Bradford? £12,000 p.a.
  • Degree apprenticeships are expanding in number every year as employers strengthen their vocational offering.

Overall then, the apprenticeship vs degree debate can be argued strongly from both sides. In this blog we have concentrated on the pay and earnings angle but there are non material considerations as well. The key, surely, is that success can be achieved by both routes but depends very much on the choices you make and the effort you put in. And for some, perhaps a little bit of luck as well. Although as the famous golfer Gary Player once observed: "The more I practice, the luckier I get." We'll take that quote as another vote for the vocational route.

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