The labour market returns to graduation: reconciling administrative and survey data estimates

This paper contributes to the literature on the earnings returns to university graduation. Recent evidence using administrative earnings data from England suggests a zero return to graduation for men and positive returns to graduation for women in annual earnings at age 26. We show that once hours worked are taken into account – typically not available in administrative tax data – returns to graduation in hourly wages are considerably smaller for women than returns in annual wages at this age. Graduate women work more hours than comparable non-graduate women; thus, not taking hours worked into account leads to overestimating returns to graduation for women by more than two-fold. This highlights the importance of using both survey and administrative data sources when estimating the returns to university graduation.