Student payback

With increased tuition fees and the opportunity cost of not working for 3 years, the price paid for a tertiary education is increasingly a challenging one. This has become particularly so over the past decade, as the cost of living (particularly the rent) in major urban centres has risen significantly. Rents tend to go up in response to increases in the value of economic activities carried out in a location. However, for jobless students who don’t tap into the value side (and particularly for those whose parents don’t also) this is a one-sided equation. So, should prospective students shun urban universities in favour of extra-urban campuses with more space and better controls over rent? One should think carefully about that, according to a new study by CNBC which considered the ROI of education in centres across the US. Their analysis created a quotient of alumni salaries and the net cost of studying. Using this method, a significant percentage of the top performers were in major urban centres. This could point to the increasingly intertwined nature of the education and commercial ecosystems in our large cities (in the year 2017/18, 125 new university-owned or part-owned spin-off companies were created in the UK). More likely, however, based on the fact that higher salaries are typically found in large conurbations the data could point to the fact that graduates either tend to stay where they study, or that they go to college in their home city with the intention of remaining there. In the UK, student movements account for about 20% of all internal migration, with net inflows typically directed at the major cities, with the exception of London, which has a net outflow.