If you are at the crossroads that naturally emerges as a raft of A-level courses are completed, you could be wracked with indecision about whether you should follow your friends to university or, instead, embark on an apprenticeship. The decision is not as simple as it might have once been.
For a long time, university study was considered the most attractive route for people seeking to maximise their lifetime earnings. According to Graduate Labour Market Statistics shared by Universities UK, a working age graduate in 2017 had a yearly salary premium of £10,000 on average.
Evidently, even rising tuition fees haven’t hampered the popularity of higher education. Prospects reports that, across the UK, 241,585 18-year-olds joined degree courses in 2017 – an all-time high. It all paints a rosy picture of universities’ credentials, but apprenticeships have been catching up…
Since 2014, 56,200 workers have flocked to higher and degree apprenticeships to work towards qualifications ranging from foundation degree equivalents to full master’s degrees. By doing an apprenticeship, you can gain practical work experience while even earning money.
Essentially, a university course is open-ended and teaches various soft skills applicable to any job position. An apprenticeship, meanwhile, will prepare you for a specific industry or role but exempt you from needing to pay costly tuition fees. Still, what about when it comes to earning potential?
Money, money, money – is it an apprentice’s world?
It would certainly be sensible to observe that, in many senses, apprenticeships do not heavily deplete bank balances in comparison to degree courses. Aged under 25? You wouldn’t need to pay anything for your apprenticeship – the Government and your employer will meet the cost of training.
Contrast that to the situation with an undergraduate degree – which, it is estimated, could land the graduate with debts totalling up to £50,000. Still, until your yearly earnings reach at least £21,000, you won’t be required to start repaying any of that.
Still, it remains inescapable that, in the words of Brian Berry, Chief Executive of the Federation of Master Builders (FMB), “apprentices pass the finish line completely debt-free”, as PoliticsHome reports. Even if you are aged between 16 and 18 or in your first year of apprenticeship training, you would be entitled to the national minimum wage for apprentices, which is currently £3.30.
How can your earnings shape up in full-time work?
Whether you opt for university study or the apprenticeship route, you will know that your chosen path will simply be preparing you for the Holy Grail that is a full-time job. Okay, so you might deem the real “holy grail” to be an impressive salary – so, which route would get you there?
You might not be surprised to learn that it’s not an entirely straightforward question to answer. The perceived wisdom is that holding a degree entitles you to a salary premium – an assumption that those previously mentioned Graduate Labour Market Statistics appear to back up.
However, various easy-to-overlook factors can rather muddy the picture. For example, if you’re currently eyeing university study, it can pay – quite literally – to be careful where exactly you pick up your degree. Unless you can land a place at one of the prestigious “Russell Group” universities, you might be better off studying for a level 5 higher apprenticeship.
In doing so, you could earn as much as £1.5 million in your career, according to research by The Sutton Trust. The educational charity found that, by graduating from a university outside the Russell Group, you could expect to amass nearly £52,000 less in earnings that, as a result, total £1.4 million.
You would be the cream of the financial crop – at least theoretically – if you graduated from a top Russell Group university, however. Your lifetime earnings in that instance could reach, as estimated, £1.6 million. However, could a tradesperson close the gap by refining their practical skills?
Don’t be over the hill – improve your skill
As a general rule, if you develop a specialist skill that is in high demand, you can potentially monetise that skill to financially impressive effect. There has recently been very strong support for this idea in the form of research by the FMB…
This research saw small building firms nationwide queried about their tradespeople’s salaries. In the subsequently compiled table of the average annual salaries, site managers ranked highest with takings of £51,266. Plumbers only slightly trailed on £48,675, while electricians took £47,265.
London-based bricklayers earned an especially impressive £90,000 a year, but even the national average for bricklayers – £42,034 – remained noticeably higher than many of the average annual salaries of university graduates. For example, while pharmacists edged just ahead on £40,268, dental practitioners, architects and teachers earned, respectively, £40,268, £38,228 and £37,805.
These figures have led FMB Chief Executive Brian Berry to declare pursuing a construction career “an increasingly savvy move”. He called on “all parents, teachers and young people, who too-often favour academic education, to give a career in construction serious consideration.”
An especially strong incentive to choose such a career is the opportunity to help fill a skills gap. Berry noted that, according to FMB research, “more than two-thirds of construction SMEs are struggling to hire bricklayers and 63 per cent are having problems hiring carpenters.”
With a shortage of skilled workers potentially putting the Government’s housing targets at stake, Berry revealed that the FMB aims to “improve the quality and quantity of apprenticeships because the only way we will build a sustainable skills base is by training more young people, and to a high standard.”
Whatever your earnings, you should remain cost-conscious
However much you are currently earning or expecting to earn, you should remember to provide a financial cushion for yourself in case things go awry. Should your work inconvenience a member of the public in a way that leaves them entitled to compensation, you would be grateful for having earlier implemented public liability insurance, which we can provide for your reassurance.