As students return to school, they face the familiar subjects that may not be their favorites. Many dream of the day they can drop the subjects they dislike, but should they? Is it possible that the subjects you choose in school can impact your financial future? Let’s explore which subjects tend to lead to higher incomes and which ones may not.
The Financial Impact of Education
The Department of Education conducts an annual study to assess how graduates are faring financially. On average, a graduate earns £28,800 five years after graduation, which is approximately £3,000 more per year than the average for individuals of the same age. This income gap tends to widen over time. Consequently, the HL Savings & Resilience Barometer reveals that graduates tend to be more financially resilient compared to non-graduates. Higher earnings typically result in greater financial stability, emergency savings, pension contributions, and homeownership—approximately half of graduates own their homes, compared to one-third of non-graduates.
However, the subject you study plays a significant role in these financial outcomes. Recent data indicates that the highest average salaries are earned by graduates in medicine (£52,900), followed by economists (£40,900), pharmacologists (£37,600), and engineers (£36,100). In contrast, graduates in performing arts only make an average of £21,200 five years after graduation. The least financially rewarding subjects include creative arts and design, agriculture, communications, psychology, history, and philosophy.
A prior study by the IFS revealed that women who studied creative arts and languages earned the same amount throughout their lives as they would have without a university degree. Meanwhile, men who pursued creative arts earned less than their non-graduate counterparts.
Variability within Subjects
If your child is passionate about a less financially rewarding subject, there’s some hope. Income within each subject can vary significantly. For instance, Business Studies graduates can earn anywhere from less than £20,000 to more than £70,000. Some creative arts and design graduates do outearn the lowest earners from other subjects, aside from medicine, dentistry, and veterinary science. There are exceptions to every rule.
Beyond Income: Finding Passion
While income is a crucial consideration, choosing a subject is about more than just the potential earnings. Many individuals have careers they are passionate about, where job satisfaction outweighs the need for a high salary. However, when investing significant sums in a university education, financial payback becomes a relevant factor in the decision-making process.
In conclusion, the subjects you choose in school can have a substantial impact on your financial future. While passion for a subject is essential, it’s wise to consider the potential for financial stability and growth. Finding the right balance between personal interest and financial prospects is key when making educational decisions, especially in the context of rising education costs.