🎓Is a University Degree Still Worth It?

Analyzing the Italian Labour Market Participation and Wage Gap of University Graduates vs. Non-Graduates

Following structural changes like the “3+2” university reform and broader cultural shifts, Italy has seen a significant boost in both university enrollments and graduations.

Looking at the labour market (latest figures available), roughly one in four workers holds a university degree (Fig 1), and this proportion has experienced steady, linear growth over recent years.

With more graduates entering the workforce than ever before, a critical question arises:

• Is a university degree still a sound financial investment compared to the opportunity cost of deciding not to study?

• Do graduates actually earn more than their peers without a degree, and if so, by how much?

• More importantly, as the supply of highly educated workers increases, is this wage gap growing or shrinking?

The data indicate that a substantial wage gap not only persists but is widening. As of 2023, university graduates earn 1.25 times the salary of workers with a high school diploma, and 1.34 times the salary of those whose education stopped at the primary or middle school level. Notably, despite the increasing labour market share of graduates, this wage premium continues to trend upward over time.

While the Italian labour market is absorbing a higher volume of university graduates, the financial return on education remains robust. The data demonstrates that a degree still commands a significant and growing wage premium over lower educational levels, confirming that higher education remains a financially justified investment

While it is clear that Italian university graduates earn more than their non-graduated colleagues, a broader question remains: how are Italian wages trending overall, both over time and in comparison to other European and Eurozone countries? In our next iterations, we will explore this comparison using OECD (Organisation for Economic Co-operation and Development) data. Stay tuned!

Methodology note: These figures are based on the median gross hourly earnings of employees, calculated as the ratio between the wages of university graduates versus other educational attainment levels

Data Source: The data used for this analysis is publicly available through ISTAT (1, 2).

Source Code: The Python code used to process the dataset and generate the visualizations is accessible in a public GitHub repository I’ve made available (LINK)