The Dispatch
Are UK teens ditching the uni dream?
For the first time, the proportion of British young people opting to study at university dropped. Do they still see value in a degree?
By Nick Harland
"700,000 UK graduates are currently out of work and claiming benefits."
“You are still much better off with a degree than without one.”
“University, for the first time in a long time, isn’t the default path for young people in the UK anymore.”
In brief
- Rising costs and stagnant job prospects are driving the first decline in UK university application rates, challenging the long-held "default" path of higher education.
- Ballooning tuition fees and 6% interest rates create significant debt, while 700,000 graduates remain unemployed, leading many to seek "barrier-breaking" routes through vocational skills instead.
- Universities must adapt as Gen Z embraces apprenticeships and side hustles, valuing on-demand, practical learning and "real-life skills" over the eroding traditional campus lifestyle.
When Michael Olatokun decided to study computer science at university, he was doing so because he saw it as a ‘sure bet.’ This was in 2011, and the tech sector - as well as the UK higher education sector - was on an upward curve. The proportion of 18-year-olds applying for university had just hit a record 32 percent and Olatokun’s degree eventually led him to a secure, well-paid career; one that allowed him to pay off his student loan relatively quickly.
Now, however, things have changed.
Since Olatokun started his degree, tuition fees for domestic students in the UK have ballooned from £3,225 to £9,535. For those who started university between 2012 and 2023, they could be repaying their student loan with an interest rate of over six percent, making it almost impossible for many to even make a dent in their student debt.
Many would argue that as long as you also get a secure, well-paying job then that’s not necessarily a problem. Student loan repayments only kick in after a certain salary threshold (£29,385 for the 2012-2023 generation) and are written off 30 years after you first hit that threshold. It’s more of a tax than a traditional loan.
The problem is that for many young people, a degree no longer guarantees a secure, well-paying job. In fact, it no longer even guarantees a job. Recent reports suggest that 700,000 UK graduates are currently out of work and claiming benefits, with their job application success rate said to be the lowest in 30 years.
"University is a tough sell right now,” says Olatokun.
“In terms of fees and value, there's nothing to incentivise young people. Even the university lifestyle is slowly eroding away,” he adds, referencing the rise in the number of UK students who commute to university rather than living in on-campus accommodation (31 percent now compared to 22 percent a decade ago), an increase that’s largely down to financial concerns.
The commuting gap is even greater among disadvantaged students, who may well be reconsidering the guarantees that a degree can give them. Part of the reason why Olatokun picked a sure bet for his degree was because of his working class background. "[Growing up in] a Nigerian household, parents will typically tell you to do engineering, become a lawyer, become a doctor... go down these barrier-breaking routes from a class point of view." Now, many working class students are likely to double down on ‘safe’ degrees - or ditch the uni dream altogether.
Now, there are signs that more and more young Brits are reconsidering their plans to go to university. Application rates among 18-year-olds had been steadily rising ever since the then Labour government set a target of 50 percent of young people attending university in 1999. It meant that over the course of the next two decades, going to university almost became the default path for young people in Britain.
Application rates peaked at 42.8 percent in 2022, but the following year saw the first decline since records began. They now sit at just over 40 percent, but with all of the negative headlines surrounding student debt and job prospects, it may be that teenagers will start considering alternative routes.
Olatokun certainly thinks they will. It’s part of the reason why he founded SkillStruct, a firm that provides training opportunities in tech to young people from underrepresented backgrounds. They run workshops, offer online courses and provide recruitment support for employers.
According to Olatokun, SkillStruct is offering what more and more young people in the UK are looking for: skills-based learning, practical experience and quick access to the job market. He says he is ‘definitely hearing more stories’ about young people turning away from higher education in favour of apprenticeships, entrepreneurial ventures and side hustles.
SkillStruct is focused on the tech sector, but other industries are starting to appeal to young people too. For example, as more young people went to university, careers in trades became less popular. Consequently, the UK is now facing a trades shortage that has seen the numbers of builders, welders and plumbers plummet in recent years.
More recently, however, it seems young people are once again starting to consider this career path. A recent survey from MyBuilder.com found that 21 percent of respondents were considering retraining as a tradesperson. Of the people surveyed, 25 percent had a degree and 18 percent regretted going to university.
Though serious alternatives to university are starting to crop up, not everyone agrees that we’re seeing the start of a decline in UK higher education. Nick Hillman is the Director of the Higher Education Policy Institute (HEPI), and believes the value of a degree remains high despite the current uncertainty surrounding it.
“While it is true that the graduate labour market is in a dicey position, you are still much better off with a degree than without one - both in terms of earnings and the likelihood of being in work as well as non-financial benefits,” he says. The average salary of UK graduates is £42,000, compared to £30,500 for non-graduates.
“Entering higher education remains a pretty safe bet for most people who can find a place, though I would always urge people to do their homework first to ensure they know as much as possible about the courses they are interested in.”
According to UCAS, the organisation which manages undergraduate admissions in the UK, the levelling off of application rates among young people doesn’t yet point to a long-term decline.
“UCAS data shows an increase in the number of UK 18‑year‑olds applying to university or college by the January Equal Consideration Date,” says Dave Penney, the firm’s Chief Communications and Marketing Officer.
“This reflects continued growth in the UK 18‑year‑old population, which is expected to continue throughout this decade. When viewed as a proportion of the population, application behaviour appears to be settling into a more consistent, pre‑pandemic pattern. This suggests that, despite cost‑of‑living challenges, appetite for higher education among school leavers remains undiminished.”
Hillman adds that alternatives to traditional higher education, such as apprenticeships, also remain difficult to access. Just over 350,000 people started an apprenticeship in 2024; a figure considerably down on 2012’s high-water mark of 521,000. Degree apprenticeships have grown in popularity over the past decade, but still represent just 5 percent of all bachelor’s-level qualifications awarded in the UK.
But rather than following these structured paths, Olatokun believes that young people may increasingly consider alternative educational and career paths. Online courses are easier to access than ever before, you can learn the basics of plenty of subjects in a YouTube tutorial, and learning is expected to be on-demand rather than semester-based. “The barriers are down,” he says. "And a lot of young people are valuing real-life skills and purpose."
He also notes the booming side hustle culture among Gen Z. “The trend in Gen Z and self-employment is fascinating to me,” he says. “I’m seeing entrepreneurs doing brilliant things from such a young age.”
It’s a feeling that’s supported by the numbers: a recent Axios survey discovered that 57 percent of Gen Z has some form of side hustle. With the old guarantees of a solid, well-paying career disappearing in front of their eyes, it makes sense that young people may want to take the initiative in their career and put themselves in control.
Whether these alternative routes ever push aside the uni dream remains to be seen. But it does feel increasingly as though university, for the first time in a long time, isn’t the default path for young people in the UK anymore.