Labour market motivation and undergraduates’ choice of degree subject

Labour market outcomes of undergraduates' choice of subject are important for public policy and for students. Policy interest is indicated by the prominence of ‘employability’ in public discourse and in proposals to concentrate government funding in England in supporting STEM subjects (science, technology, engineering and mathematics). As students in England face the prospect of bearing the full financial burden of undergraduate tuition, the large differences between wage premia for different subjects may become of increasing interest. We find that, even after taking account of differences in motivation towards the choice of undergraduate subject, males and members of certain non-White ethnic groups are more likely to choose ‘high wage-premium’ subjects. We also find some significant differences between the motivations of different minority ethnic groups. However, students from lower income households are less likely to choose high wage premium subjects, which is a concern for this aspect of policy towards participation in higher education and social mobility.