It’s often difficult to decide whether universities and the government are living in la la land1 given their level of disconnection with the realities of student life and graduate prospects. What has become ever clear is that they are expecting students to live on the never never2 with a promotional message about the benefits of higher education based on magical thinking, pixie dust and a belief in fairies. Around 44% of students starting in 2024/25 are expected never to repay their loans which is better than the 68% of the 2022/23 cohort but comes at a very high cost to many young people.
Nurses repaying more than £5,000 in four years but seeing their debt rise by £20,000 due to interest rates and more than 150,000 with student loan debts over £100,000 are the tip of a very ugly iceberg that is likely to hole the credibility of higher education as a route to a better life below the waterline. Having Plan 2 students paying 3% above RPI and wringing hands about the mental health impact of student debt and low-paid jobs for new graduates is a national disgrace. Despite the warning signs and just like the Titanic there is no fundamental change of direction or speed which looks increasingly like negligence, arrogance or stupidity.
“All the world is made of faith, and trust, and pixie dust.”
For many years successive governments and the higher education sector have collaborated, some might say conspired, to sell a dream of higher wages, better jobs and more security to young people. This is despite the government’s own statistics showing that the annual real median salaries of both undergraduates (down 11.7%) and postgraduates (down 16.9%) have been declining since 2007. By comparison non-graduate salaries have decreased by 2.5% over the period.

In 2020, the Institute for Fiscal Studies estimated that “…around one in five undergraduates would have been better off financially had they not gone to university.” In 2025, even David Willetts was obliged to note in a polemic arguing in favour of higher education “..there is no hiding from some uncomfortable findings”. His grasp of current realities was probably best illustrated by his use of long Kingsley Amis quotes from 1960 (Encounter)3 and 1954 (Lucky Jim) at the start of his paper.
Another sign of the shifting tides is that in 2025 the rise in the National Minimum Wage to £25,500 makes it a higher sum than the salary for 10% of advertised graduate jobs. The most recent changes to the student loan scheme (Plan 5) means that graduates on minimum wage are obliged to start paying their student loan. When the minimum wage increases by 4% in April 2026 the overlap between graduate and non-graduate starter salaries and will only increase.
“Do you believe in fairies? If you believe, clap your hands!”
It is remarkable how often the sector trumpets research focused on current university students as a proxy for continuing demand in a university education in the future. When you have started a course your propensity for post-purchase rationalization or choice-supportive bias is high. The sunk-cost fallacy should also temper some of the wilder claims about belief in the value of higher education sector.
Perhaps of more interest is the YouGov report from mid-2025, which indicated that two-thirds of current students thought “the standard of education and the wages graduates earn are not enough to warrant the cost of English/ Welsh university degrees”. It’s a stark reminder that even if current students think they might get a better job or higher wages they are not willing to applaud universities as being value for money. A third of these students didn’t expect to ever pay of their student loan but probably had little appreciation of the long term impact of everlasting monthly repayments on their future standard of living.
Even research after graduation showing high levels of belief in the importance of getting a degree indicates that 35% would have chosen “to do things differently” in terms of the course, location or other factors. At the very least this suggests that advice ahead of taking a degree is inadequate. With more than 700,000 university graduates out of work and many citing “health reasons” there are probably many graduates who are more sceptical about the value of their investment of time and effort.
More troubling for the sector may be that the tide of public opinion seems to be moving against them when it comes to value. Research suggests that in 2018 only 18% of people did not consider university education worth the time and money but in 2024 this had grown to 31%. It is particularly notable that the 25-34 age group in the survey had 48% saying university was not worth it.
“The moment you doubt whether you can fly, you cease for ever to be able to do it.”
For many years the argument was that graduates did better, lived longer and were happier than non-graduates. It remains the stock in trade of the university pundits and mouthpieces who seem immune to the reality that past performance is no guarantee of future returns. Their problem is that universities sit in a world where they talk to other universities and agree with each other.
Fortune magazine suggests that GenZ graduates in the UK are earning 30% less than millennials did. In 2022 over 30% of graduates were in non-graduate work or unemployed after 15 months. Another indicator is that the number of students beginning to repay their loans within two years of graduation has taken a significant fall, even amongst Russell Group graduates.
Over and above that new graduates are coming into a labour market which, on many counts, is more fraught and complex than for many years, and which some suggest may never recover. In late 2025 graduate vacancies advertised were a third lower than the same time in 2024 with evidence that regional variations made this even worse for some new graduates. Even if graduates can get a job the OECD suggests that four in ten are likely to be overqualified which is in the ballpark of Office for National Statistics research from 2019.
It is reasonable to reflect that the siren voices of higher education are keen to say that everything is in good order and that keeping a steady course is the right answer. Universities UK say the country will “need more than 11 million extra graduates…to fill jobs in the UK by 2035”. It is suggested that the report, “Jobs of the Future”, is based on analysis by Charlie Ball (of Jisc and Prospects) who appears to be a general source of upbeat news for those seeking it.
One claim in the report is that there will be a net increase of 10% “in jobs that require a degree over the next 20 years”. It will be interesting to see how that plays against Morgan Stanley’s recent report indicating that the impact of AI is seeing UK firms cutting more jobs than are created at a faster rate than other major economies. The suggestion is that young people and white-collar workers “are getting hit especially hard.”
Of course, it may be that only non-graduate jobs are being impacted by AI uptake. It may be that there is an underlying growth in graduate level jobs that reflects the increase in the number of graduates available. But, it may be that this an article of faith supporting sector led self-interest in recruiting new graduates. If young people stop believing it’s a marketing story that will not fly.
NOTES
- The phrase la la land appeared in print in 1925 and appears to have been a contraction of the French phrase “ooh-la-la”. It was popularized in the 1970s as referring to the idiosyncracies of Los Angeles (LA) and its movie industry.
- “Buying on the never never” was a phrase popularized in the UK in the 1960s and 1970s. It reflected the growing use of hire purchase credit schemes to buy relatively expensive products like cars and household goods that could not be funded immediately from savings or wages. For the suspicious, cautious and plain scared perjorative use of “the never never” was usually aimed at the aspirational middle-classes who were cast as living beyond their immediate means.
- The story of Encounter magazine is fascinating. It emerged from a meeting of CIA and MI6 representatives in 1951 with much of the funding coming covertly from the Foreign Office and the CIA-managed Congress for Cultural Freedom. Loss of that funding was a primary cause of its demise.
The sub-headings are all attributed to James M. Barrie, author of the playPeter Pan or, The Boy Who Would Not Grow Up that was first performed in 1904 and published in 1928. The first Peter Pan film adaptation was a 1924 silent movie from Paramount Pictures. Disney’s version of Peter Pan was released in February 1953.























