A new report, published by the Institute for Fiscal Studies (IFS) for the Department of Education (DfE), provides estimates of the earnings returns to completing postgraduate degrees, for British and Northern Irish students studying in Britain.

Authors of the report - Dr Matt Dickson, Jack Britton, Professor Franz Buscha, Laura van der Erve, Professor Anna Vignoles, Professor Ian Walker, Ben Waltmann and Yu Zhu - used the Longitudinal Education Outcomes (LEO) dataset to compare the earnings at age 35 of individuals with postgraduate degrees and those with undergraduate degrees only. It is the fourth report in a series of research publications from the DfE, which have also covered lifetime labour market returns, absolute labour market returns and relative labour market returns.

Key findings of the report reveal postgraduate degrees do not, on average, increase earnings relative to what would have been expected of graduate earnings if they had left education with just an undergraduate degree. This differs by gender however with women enjoying positive returns to masters, PhD and PGCE degrees, while for men the returns to these are on average negative.

However, the report also reveals how returns to masters and PhDs vary by subject, institution and prior qualifications, as Dr Dickson explains:

"While on average graduates of masters courses do not see a substantial increase in earnings over and above what we expect them to have earned had they left education with just an undergraduate degree, there is a lot of variation depending on the subject of the masters and subject at undergraduate level."

"For those who have graduated from a relatively low-returning undergraduate course, the best option for maximising earnings is to diversify. For example, after having done an arts degree, ‘doubling down’ by going on to a further degree in the same field is likely to result in large negative returns. However for these graduates returns to a masters in a different field are overwhelmingly positive."

Findings of the report also reveal returns to PGCEs vary by institution and prior qualifications. PGCEs prove to be a relatively ‘safe’ choice for both women and men whatever their previous degree – reducing the chance of unemployment, or of earning less than £30k – and graduates of subjects such as sports science and creative arts have large and significant positive returns to PGCEs.

Dr Dickson adds:

"For students of nearly all undergraduate subjects there are some subjects they can take at masters level which lead to positive returns - even for men, who see very low returns on average. Overall, the information in this report is extremely important for prospective postgraduate students choosing a course."