The increasingly competitive nature of the graduate job market means that deciding to do a degree requires more than a simple love of the subject. A degree is more commonly seen as an investment: an investment in increased future earnings.
So how wise has your decision to study economics been? There has been a lot of research into this area, with numerous surveys and results. In fact, the Institute for Fiscal Studies found that economics is the second most lucrative degree subject after using anonymised tax data and student loan records for 260,000 students up to ten years after graduation.
|Most lucrative degrees, 10 years on:|
|Degree||Women’s salaries||Men’s salaries|
|Engineering and technology||£23,200||£31,200|
|Maths and Computer science||£22,000||£26,800|
|History and philosophy||£23,200||£26,500|
|European languages and literature||£26,400||£25,000|
|Linguistics and classics||£23,200||£24,100|
|Veterinary and agriculture||£18,900||£21,400|
|Base: Median annual salary|
|Source: IFS and BBC|
It is also interesting to note that it is estimated that around 12% of male economics graduates earned above £100,000 some ten years after graduation; by contrast, 6% of those studying medicine or law earned more than £100,000. In terms of females, it is estimated that around 9% of economics graduates earned above £100,000 some ten years after graduation; by contrast, just 1% of those studying medicine and 3% of those studying law did so (Institute for Fiscal Studies).
So, as a percentage, you can expect to get more but how much can you expect to earn? The Complete University Guide has formulated a table which shows average earnings by degree. You’ll be pleased to hear economics comes fourth. According to the Complete University guide, an economics graduate starting work in 2015 could expect to earn £28,019. The average of earnings for all 61 subjects in the survey is £22,855, earning economics graduates £5,164 above the average graduate and £9,876 over the average salary of a non-graduate. So, if that difference is constant for five years, those graduates earned around £49,380 more than a non-graduate.
The Prospects site reports that typical starting salaries for an economist can be anywhere from £25,000 to £35,000, rising to up to £40,000 with a few years’ experience. For a financial risk analyst, starting salaries are around £21,250, rising to between £29,000 and £44,000 after six years’ experience, not including bonuses. Many other typical careers are listed in the guide “What can I do with my degree in Economics?”.
The job market site Adzuna has a charting tool that compares salaries for an economist (or any other job title you enter) to the national average, and also shows changes in number of vacancies by year. As of February 2020, they are showing a national average of £34,529 versus an average for economists of £48,929.
All these pieces of research state different starting salaries for economics graduates in different sectors, yet they all highlight that economics graduates can expect to earn above average starting salaries, leading to a faster degree pay-back period and a better rate of return.