Treating Students Fairly: The Economics of Post-School Education Contents

Chapter 1: Post-school education in the 21st century

“So today I set a target of 50 per cent of young adults going into higher education in the next century.” Prime Minister Tony Blair, Labour Party Conference, 28 September 1999.1

“UK higher education offers a diverse range of courses and qualifications, such as first degrees, Higher National Diplomas and foundation degrees. It includes any qualification at Level 4 and above. A BA or BSc (Hons) degree is a Level 6 qualification.” UCAS website, March 2018.2

1.The full-time university undergraduate degree has become synonymous with higher education. As the quote above from the UCAS website makes clear, higher education in the UK includes any qualification at Level 4 and above (such as foundation degrees and other higher vocational qualifications below degree level), which can be studied at higher education or further education institutions (Figure 1 describes what the different levels of qualifications in the UK are). Around half of young adults now participate in higher education but the overwhelming majority study for undergraduate degrees, many of which have an uncertain value in the labour market.

2.There is a skills mismatch in the UK: despite the record numbers of the population with an undergraduate degree, businesses are reporting a shortage of people with technical skills. There are higher education qualifications that could provide these skills but demand from students is very low and the quality and availability of those options is variable.

3.Apprenticeships are another option for higher education but, with some notable exceptions, provision and quality is again variable and the Government’s headline figures for new apprenticeships do not tell the whole story.

The growth in higher education since 1999

4.By 2016, Mr Blair’s target of half of young people going into higher education had almost been achieved: 49 per cent of 17 to 30-year olds were estimated to have entered higher education for the first time.3 In 1999, when Mr Blair set his target, this figure was 39 per cent.

5.There are broadly three options for new entrants into higher education: an undergraduate degree (Level 6), a sub-degree qualification (Level 4 and 5; for example, a foundation degree in laboratory science) or a vocational qualification (Level 4 and above; for example, a higher diploma in electrical and electronic engineering). Students may study some of these qualifications at colleges of further education. Qualifications in all three of these options can be undertaken full-time, part-time or as part of an apprenticeship.

6.Amongst young people, the growth in higher education since 1999 has been almost entirely through increasing numbers enrolling on undergraduate degree programmes. Figure 2 shows the number of first degrees awarded in the UK rose from 265,000 in 1999/2000 to 414,000 in 2016/17.

Figure 2: Higher education qualifications awarded in the UK, all ages, 1999/2000 to 2016/17

Line graph showing numbers of awards for 3 different levels of award from 1999/2000 to 2016/17

Source: National Statistics, ‘Education and Training Statistics for the United Kingdom’, 2001 edition to 2017 edition

7.The number of sub-degree qualifications awarded was 77,000 in 2016/17, around the same as in 1999/2000. The number of higher vocational qualifications awarded increased by around 100,000 over the period.

8.These figures are for all ages. The proportion of young people studying vocational qualifications, and other undergraduate qualifications, is very low compared to first degrees. In 2014/15, 28 per cent of higher vocational qualifications were awarded to people under the age of 25, and 35 per cent of students studying other undergraduate qualifications were under the age of 25; by contrast, 82 per cent of students studying for a first degree were under 25.4

9.There has also been a dramatic reduction in part-time study—numbers fell by 60 per cent between 2010 and 2016—where students are more likely to be older adults. This is at a time when it is acknowledged widely that retraining throughout a person’s career will become increasingly necessary. This is considered further in Chapter 5.

Box 1: Defining higher education

“We are back on track this year with increasing numbers going to university. Whether or not we hit the decade target, we need to be aiming to hit the target of 50 per cent for the future.” John Denham MP, Minister for Universities, April 2008.5

“Call for review of 50 per cent university target”, headline in the Financial Times, March 2010.6

“Tony Blair took it further by adopting an explicit target that 50 per cent of people should go to university.” Nick Boles MP in the Daily Mail, December 2017.7

“Everybody seems to think that Blair’s policy is to send 50 per cent of people into university but this is not true. The target is 50 per cent of under 30 year olds should have some kind of higher education qualification. This includes NVQ Level 4, HND, HNC and foundation degrees … I just thought I would point this out as a lot of people seem to think it means 50 per cent of people doing honours degrees.” Post on the Student Room website, January 2004.8

As noted at the start of this chapter, higher education is much broader than the undergraduate degree. Tony Blair’s target to send half of young people into higher education is a good example of how higher education is seen to refer only to university education, as shown by the selection of quotes above.

The Labour Party Manifesto in 2001 acknowledged the target did not just refer to undergraduate degrees:

“It is time for an historic commitment to open higher education to half of all young people before they are 30 … new two-year foundation degrees to offer students the option of a vocationally relevant, high-quality qualification as a way into skilled work or further study.”9

This report aims to dispel the notion that higher education means studying for an undergraduate degree in a university.

Level 3 education for adults

10.Figure 2 shows that there has been a decline in sub-degree qualifications amongst all ages since 2010. There has also been a decline in the number of Level 3 (A-Level or equivalent) qualifications awarded to adults; there were around 190,000 advanced qualifications awarded to students aged 19 and over in 2016/17, down from 283,000 in 2010/11.10

11.They are delivered largely through the further education sector. They develop the skills of the half of the population who do not go into higher education at a young age and prepare those who wish to pursue higher education in the future: for a person who did not do well at school, achieving an alternative Level 3 qualification to an A-Level is the first step in progressing to Levels 4 to 6. The decline of advanced qualifications, at the same time as an increase in undergraduate degrees, may be reflective of the unequal funding arrangements for the respective educational institutions. This is considered further in Chapter 4.

12.More encouragingly, there has been an increase in the number of advanced level (Level 3) apprenticeships since 2010. The main motivation behind apprenticeships is to ensure that young people who do not pursue the academic route are able to learn a skill through part-time study linked to supervised on-the-job experience. Part-time study for advanced level apprenticeships was funded through the further education budget until the apprenticeship levy was introduced in 2017, through which all apprenticeships are now funded. We consider whether funding for advanced level apprenticeships may be squeezed out by higher level apprenticeships under this new system in Chapter 6.

13.The next chapter considers the relationship between post-school education and the economy.

1 BBC News, UK Politics: Tony Blair’s speech in full (September 1999): [accessed 24 May 2018]

2 UCAS, ‘What is higher education?’ (2018): [accessed 10 May 2018]

3 The Government measure for higher education participation amongst young people is called the ‘Higher Education Initial Participation Rate’. The Government defines it “an estimate of the actual entry rate in the current year of people who had not previously entered higher education at each age from 17 to 30, based on the current entry rate of previous non-entrants … For each age from 17 to 30, the initial participation rate is calculated as a fraction of the academic year population that are initial entrants. These rates are added to create the total [figure].” Students are counted if they participate for at least six months on a course expected to last for at least six months. Students are counted if they are on courses designated as National Vocational Qualification Level 4 or above or are listed as Higher Education courses.

4 2014/15 figures were the latest available for comparison. The Department for Education publishes a breakdown by age for people achieving vocational qualifications; the Higher Education Statistics Agency however publishes an age breakdown only for students in study, rather than for graduates in a given year, hence the comparison made above. Due to the way the statistics are grouped, it was not possible to compare numbers for under 30s.

5 ‘Labour sticks to 50 per cent university target’, The Telegraph (April 2008): [accessed 10 May 2018]

6 ‘Call for review of 50% university target’ Financial Times (March 2010): [accessed 9 May 2018]

7 ‘How to stop our universities ripping off students AND the taxpayer’ Daily Mail (28 December 2017): [accessed 10 May 2018]

8 The Student Room, ‘The 50% into university target: The facts’ (January 2004): [accessed 15 May 2018]

9 The Labour Party, 2001 Labour Party General Election Manifesto: Ambitions for Britain (May 2001): [accessed 10 May 2018]

10 Department for Education and Education and Skills Funding Agency, ‘Further education and skills: Table 4.2, 29’ (March 2018): [accessed 9 May 2018]

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