A historic low in the number of graduates from prestigious universities started repaying their student loans last year as the job market faced significant challenges.

In 2024, merely 44,527 recent graduates from Russell Group universities commenced repayment of their student loans, according to a report from The Times.

This figure starkly contrasts with the usual count of 57,000 graduates from the group of 24 elite universities who typically begin repayments each year.

The statistics, acquired through a Freedom of Information request to the Student Loans Company, reflect repayments made within two years following graduation.

Graduates are expected to start repaying their student loans each month starting from April after they leave university, provided their income surpasses the required threshold.

For those who took out loans between 2012 and 2023, known as Plan 2 loans, repayments kick in once they earn £28,470 or above.

Students who have commenced their studies since August 2023 will start to pay off their debt once their annual salary is £25,000 or more.  

The decline in the number of students paying off their debt within two years of finishing their course points to a wider graduate jobs crisis. 

In 2024, only some 44,527 recent alumni of Russell Group institutions began to repay money they borrowed from the government to fund their studies. Pictured: File photo  

Many of last summer’s graduates, even from Britain’s top institutions, are still job hunting – which is set to get harder as they compete against this year’s fresh crop. 

They report spending hours on applications and endless rounds of interviews, which are often not even face-to-face, only to be rejected – and sometimes by AI. 

And the number of positions appears to be declining too, with leading graduate employer PwC, for instance, cutting its entry-level roles from 1,500 to 1,300 this year.

Marco Amitrano, chief of the financial services firm, said last month it reflects ‘the wider slowdown in investment, hiring and deal-making across the economy’.  

One graduate, who left the University of Cambridge in 2023 with a first-class degree in Spanish, was still struggling to find a job after a year of applications. 

Finding the market ‘brutal’ and feeling ‘lost, discouraged and anxious’, she signed on for two years of further study, unsure what else to do. 

Many lightheartedly refer to such an approach, of remaining a student for fear of being unable to get a job or after struggling to find one, as a ‘panic master’s’.

And it seems this student was not the only Oxbridge alumnus under this kind of post-graduation pressure. 

At the University of Cambridge, the number of graduates repaying within two years of getting their degree fell by nearly a third (29 per cent) from 2019 to 2024. 

Only 1,200 started repayments on that timeline last year – down from some 1,700 five years prior. 

And its counterpart, the University of Oxford, saw a 31 per cent decline, from 1,560 to 1,084, across the same period.  

Imperial College London and the University of Southampton saw the biggest drop in the number of graduates able to start repayments within two years. 

In the same five-year timeframe, each institution saw a respective decline of 44 per cent and 47 per cent. 

And it has left the government an enormous £267billion out of pocket as of the end of March this year, according to the House of Commons Library. 

Nick Hillman, director of the Higher Education Policy Institute (Hepi), said the crisis reflects the struggles of the current and previous governments to create economic growth. 

‘Graduates would be on better salaries if there was more economic growth and better productivity,’ the thinktank chief said. 

It is a marked contrast from a typical year, in which 57,000 fresh graduates of the association of 24 of the country’s leading universities start repayments. Pictured: File photo  

Russell Group chief Tim Bradshaw said fresh graduates are entering a ‘challenging labour market’ besieged by ‘economic uncertainty’. 

But he said even though many appear to be earning less immediately after finishing their course, they will likely go on to make more than non-graduates later. 

Those who went to university typically earn a third more than those who did not by the age of 31, as per research by higher education association Universities UK. 

Even the hefty debt students are saddled with by the time they graduate may not be enough to cover their time at university though. 

Students now need up to £56,000 to get them through university even after taking out loans, according to research by Hepi. 

And a family hoping to support three children through degrees would have to find up to £168,000.

While everyone gets loans to cover the full cost of tuition fees, maintenance loans for living expenses may only cover as little as a quarter of the cost.

It means families need to start saving early if they want their child to be financially comfortable during their studies.

Those whose parents are unable help them financially will have to find part-time work to make ends meet, the report suggests.

Hepi director Mr Hillman said: ‘It is regrettable that we have had to calculate these numbers as, in an ideal world, there would already be a deep understanding of the true cost of being a student in the corridors of power.

‘If there were, then student maintenance support would likely better reflect the actual costs of studying in 2025.

‘Maintenance support is currently woefully inadequate, leading students to live in substandard ways, to take on a dangerous number of hours of paid employment on top of their full-time studies or to take out commercial debts at high interest rates.’

Including annual fees of £9,250, a standard three-year degree in England costs £90,000, or over £100,000 if the course is in London, the report found.

And with the government announcing this week tuition fees are set to increase every year in line with inflation from 2026 onwards, this figure will only further balloon. 

Tuition fees this academic year have already gone up to £9,535, in the first increase in more than a decade.  

But when looking at living expenses alone, the standard cost is £61,000 for outside London and £77,000 for London.

Maintenance loans are means-tested, and all families with a household income of more than £70,000 – so £35,000 per parent – only qualify for the minimum amount.

Annually, this is £4,915 for outside London and £6,853 for London – so £14,745 and £20,559 respectively over a three-year degree.

This leaves a shortfall of £46,000 outside London and £56,000 for London.

For households on the very lowest incomes – £25,000 or less – annual maintenance loans are only £10,544 for outside London and £13,762 for London.

This means they only cover half the costs of a three-year degree.