The Value of a PhD In an Economic Recession

Doctoral graduates in the United Kingdom who went on the job market as the country’s economy entered the recession were just as positive about the benefits of getting a Ph.D. as graduates who went on the market 2 years before, a new report suggests. , which was released earlier this month by the U.K. organization Vitae, gives evidence that having a Ph.D. made the recent graduates more resilient to the crisis than peers who did not have the advanced degree.

The Vitae report used data provided by the U.K. Higher Education Statistics Agency (HESA) in its Destinations of Leavers from Higher Education Longitudinal Surveys, which look at the employment situation of U.K. and E.U. graduates across all disciplines about 3.5 years after their graduation from a U.K. university. Vitae analyzed the career progression of the 2006–07 Ph.D. cohort, comparing it to its previous analysis of the 2004–05 Ph.D. cohort to get a sense of how the economic crisis has affected the employment of recent Ph.D. graduates.

“Despite the UK’s entry into economic recession during this time, doctoral graduates remained highly employable and most continued to achieve early career satisfaction in their chosen pathway.”—Vitae

The report also looked at wages, finding a median salary of £35,000 for 2006–07 Ph.D. graduates 3.5 years after graduation, a 3% increase over the previous cohort and in line with the national rise in average earnings. In terms of salary distribution, the situation also seemed to improve, with proportionately fewer doctoral graduates earning £30,000 or less in 2010 than in 2008 (27.8% versus 33.5%) and more people earning between £40,000 and £50,000 (16.1% in 2010 versus 12.3% in 2008). The percentage of the highest-earners (more than £50,000) remained the same at about 13%.

Across all sectors, the situation was overall less favorable for master’s and good first-degree graduates. The 2006–07 cohort of master’s graduates earned a median salary of £32,000 in 2010, down by 3% compared with the salaries in 2008 of the 2004–05 cohort. The 2006–07 cohort of good first-degree graduates earned a median salary of £25,000, which was the same as for the previous cohort in 2008.

There was one respect in which the later cohort of Ph.D. graduates did worse than the earlier cohort. Vitae found that 67.8% of the respondents in the 2006–07 Ph.D. cohort were on a permanent or open-ended contract in 2010, down from 69.7% in 2008. The master’s and first-degree graduates also fared slightly better here, with 76.4% and 77.7% (respectively) employed on open-ended contracts, although these numbers, too, declined compared with 2008. Overall, the proportion of Ph.D.s on fixed-term contracts remained stable at about 25%, but the contracts tended to be shorter, with the proportion of Ph.D.s employed on fixed-term contracts of more than 12 months falling from 22.3% in 2008 to 21.2% in 2010. (Meanwhile, contracts of less than 12 months rose from 2.8% to 4.6%.) Such “increases in the proportion working under fixed-term employment contracts, and a particular rise in the use of short contracts … may have been a cautious response by employers to tightening economic circumstances,” the report says.

Overall, a large majority of respondents—91.8%—said they were very or fairly satisfied with their careers so far, compared with 93% in 2008. About 85% believed that having a Ph.D. was helping them progress toward their long-term career aspirations, and 67% believed that it helped them get a job in the short term. Many also felt empowered by their Ph.D.s: About 91% believed that it helped them be innovative in the workplace, and 78% felt it helped them influence the work of others. More than 85% believed that having gone through the Ph.D. improved their social and intellectual capabilities and enhanced their quality of life.

“Despite the UK’s entry into economic recession during this time, doctoral graduates remained highly employable and most continued to achieve early career satisfaction in their chosen pathway. The perceived benefits and impacts of the experience of doctoral degree study appeared to remain high and relatively consistent,” the report concludes.

The Vitae analysis also offers a wealth of data by disciplines and occupational clusters. For more, see the full report on the Vitae website.

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