The Graduate Crisis: Overqualified, Underpaid, and Stuck in Debt

For years, young people have been sold the promise that higher education is the ticket to a better life. We were told that getting a degree would secure us a stable career, higher wages, and upward mobility. But as I near the end of full-time education, staring down a mountain of student debt and a job market that doesn’t seem to care about my qualifications, I’m forced to reckon with a brutal reality: for most, social mobility through education is an illusion.

The Overqualification Crisis: Too Many Degrees, Too Few Graduate Jobs

The UK is experiencing an overqualification crisis. More people than ever before are entering higher education, but the job market hasn’t kept up. The result? Thousands of graduates stuck in roles that don’t require a degree, earning little more than they would have without one. According to recent statistics, nearly 40% of UK graduates are in jobs that don’t require a university qualification.

How Did This Crisis Start?

The roots of the overqualification crisis can be traced back to Tony Blair’s government, which set a target of 50% of young people going to university. The policy was framed as an effort to expand access to education and improve social mobility, but it did not take into account whether the job market could absorb such a surge in graduates.

As universities expanded to meet this target, degrees became more common, and the job market failed to keep pace. While Blair’s government believed that a knowledge-based economy would generate high-paying graduate jobs, in reality, many industries did not shift accordingly. The rapid increase in graduates led to credential inflation, where employers started requiring degrees for roles that had traditionally not needed them, not because the jobs themselves had changed, but simply to filter applicants in an oversaturated market.

Figures from the Higher Education Statistics Agency show that between 2000 and 2020, the proportion of young people entering university nearly doubled. However, over the same period, the percentage of graduates in non-graduate jobs also increased, reaching nearly 40% in recent years. The disconnect between education policy and economic reality has left a generation overeducated and underemployed. At the same time, industries that traditionally did not require degrees have now made them a prerequisite, creating an artificial barrier to entry. This phenomenon, known as credential inflation, means that degrees are now required for jobs that once relied on experience and training instead.

Furthermore, many graduates find themselves underemployed, working in low-skilled service jobs simply to make ends meet. This is particularly true in areas outside of London and major cities, where graduate job markets are even more limited. Regional disparities mean that many young people must choose between staying in their hometowns with few opportunities or relocating to expensive cities where their wages barely cover living costs.

The Graduate Wage Crisis: Degrees No Longer Pay Off

Once upon a time, a degree meant a significant salary boost. Now? Not so much. While graduate wages are still higher than non-graduate wages on average, that gap is shrinking. In fact, many graduates earn little more than their non-graduate counterparts, especially in oversaturated fields.  The increase in tuition fees, from £3,000 to £9,250 per year in England, was justified on the basis that graduates would earn significantly more over their lifetimes. However, with the cost of living crisis, wage stagnation, and an increasingly competitive job market, many graduates are not seeing the returns on their educational investment.

The factors behind this are complex but interconnected:

• Supply and Demand: The UK has one of the highest rates of university participation in the world, but the job market simply doesn’t have enough well-paid graduate roles to accommodate everyone. This oversupply has diluted the value of degrees.

• Unpaid and Underpaid Entry-Level Work: Many industries expect graduates to work for free or accept low pay to ‘gain experience.’ The rise of unpaid internships and exploitative graduate schemes means that even those lucky enough to secure work in their field often struggle financially in the early years.

• Gig Economy and Precarious Work: Short-term contracts, low job security, and zero-hour contracts are becoming the norm, even for degree holders. Sectors like journalism, media, and the arts are notorious for their reliance on freelance and insecure work, making it difficult for graduates to plan for the future.

• The Cost of Living Crisis: Even those with decent graduate salaries find their real income eroded by skyrocketing rent, bills, and general living costs. In cities like London, a ‘graduate salary’ often barely covers essential expenses, meaning that many remain financially dependent on family support well into their twenties.

In some sectors, graduates are earning less in real terms than they would have decades ago, despite the fact that tuition fees have increased massively. The graduate premium-the financial benefit of having a degree-isn’t what it used to be, and for many, it simply doesn’t exist.

The Illusion of Social Mobility Through Education

Working-class students, in particular, have been led to believe that university is their route out of financial instability. The first in their family to attend university, they are often encouraged to take on massive debt under the assumption that it will all be ‘worth it in the long run.’ But is it?

Many of us leave university not only burdened with over £50,000 in debt but also struggling to find work that justifies it. Meanwhile, those from wealthier backgrounds often have access to informal networks, parental financial support, and the safety net to take unpaid internships or move to London for better job prospects. The class gap remains, despite what the ‘education equals opportunity’ myth suggests.

The idea that higher education is a universal equaliser ignores the deeper economic and social structures at play. Even within graduate roles, the ability to climb the career ladder often depends on cultural capital-knowing how to navigate corporate environments, having connections, and being able to afford periods of low pay in exchange for long-term opportunities. This leaves many working-class graduates at a disadvantage, unable to break into the higher-paying tiers of their chosen professions.

Even for those pursuing postgraduate education in hopes of making themselves more employable, the outlook isn’t much better. A master’s degree might set you apart from the ever-growing pool of graduates, but it’s no guarantee of a well-paying or stable career. And it certainly won’t erase the debt.

Conclusion: Was It Worth It?

As I prepare to leave full-time education, I find myself grappling with this question: Was it worth it? I don’t regret studying. I love learning, and I’ve gained invaluable skills and experiences. But financially? Career-wise? It’s looking bleak. I, like many others, am walking straight into a job market that doesn’t value my education, with debt that will haunt me for decades.

The system is broken. Until we address the root causes of the graduate and overqualification crisis, young people will continue to be sold a lie that a degree is the key to success, when for many, it’s just a very expensive, very stressful detour to nowhere.