U.K. grads are earning 30% less out of college than they did in 2007-research finds the pay premium for Gen Z isn't what it was for millennials | Fortune

Higher education has shifted with AI, but financial returns on degrees have been falling for over a decade. The graduate pay premium over minimum wage has halved since 2007. After inflation, average working-age graduate salaries are about 30% lower than 15 years ago, leaving Gen Z graduates earning less than comparable millennials. Approximately 1.5 million students take loans annually, graduating with an average debt of £53,000. Job market competition has intensified: 1.2 million applications chased 17,000 U.K. graduate roles in 2023–2024, averaging 140 applications per graduate job. Many graduates report demoralization and lengthy job searches.

"For more than a decade, the financial value of a degree has been quietly eroding. New research reveals the graduate pay premium over minimum-wage salaries has been cut in half since 2007. Once adjusted for inflation, the average salary for working-age graduates is now 30% lower than it was a decade and a half ago, according to government data analyzed by . That means today's Gen Z grads are earning significantly less than millennials did at the same stage of life."

"It's a sobering reality in a country where roughly 1.5 million students take out loans each year, graduating with an average debt of £53,000 (about $71,000). The shrinking payoff makes the cost of a degree feel increasingly out of step with the returns. And salaries aside-even securing a job has become harder. A report from the Institute of Student Employers found that 1.2 million applications were submitted for just 17,000 U.K. graduate roles in 2023-2024. Employers now receive a record 140 applications on average for each graduate job."

"For many graduates, their post-graduation reality is demoralizing-especially after being told for years that a university degree was the surest path to a high-paying career. One recent graduate, Jaymie Lazenby, admitted that many graduates (including himself) entered the job market assuming they'd land a real job quickly, but that ended up being far from the truth. "After you leave, it's not as easy to just walk into a job as you thought it might have been at the start," Lazenby told. He applied to as many as 500 roles before finally conceding a position in a business apprenticeship-something he could have landed without his degree."

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