Student loans struggle to keep up with the ever-rising cost of living. This is a significant and ongoing challenge for higher education students. Research from the Office for National Statistics reveals that a staggering 92% of student survey participants have noticed that living costs continue to climb. Living near the university, as required by many colleges, is a costly undertaking. The cost of student accommodation in Oxford ranges between £7,110 and £8,595 for just nine months. The university bases this figure on a ‘single, full-time student, with no dependants, living in Oxford’. Those studying part time in Oxford face even higher expenditures; many shell out for travel and short-stay Airbnbs or hotels.
The situation is so severe that 65% of students report having made drastic choices such as skipping meals, turning off their heating, or even dropping out of their courses to make ends meet. These choices, often made out of necessity, can significantly impact long-term health and well-being. The usual antidote is to work while studying to cover rising costs not met by student loans; the University however prohibits most students from working while studying for their degree. Those who do work often have less time for their social life and studies.
With a new budget announced by the Labour government and the Renters’ Rights Bill undergoing amendments, this article delves into how these policies could reshape the UK’s economy and what this might mean for students.
The cost of living will continue to rise, while the job market becomes more challenging
While you may have high hopes that these new policies will positively impact students, bus fares are increasing £1 more each way, starting in the new year. Train ticket prices are also increasing, as the regulated train fare in England will rise by 4.6% in the new year. Meanwhile, the cost of a 16 to 25 railcard will increase by £5, now costing £35 per year. For students working alongside their studies, the good news is that the minimum wage will rise from April 2025. However, due to tax increases in the Budget, employers will have to pay more in national insurance for each employee; students may find it harder to land their first jobs.
Is student accommodation improving?
There might be some negative movements in student accommodation as well. The Renters’ Rights Bill has finally moved to the Committee stage. The Student Accredited Private Rental Sector (SAPRS) has raised concerns that the Bill does not tackle the challenges of the student housing market, where demand remains high but supply remains unsatisfactory. As the SAPRS stressed, there will be a 490,000-bed shortfall by 2026 (a 100,000-bed shortfall in London). Even though purpose-built student accommodation (PBSA) may be excluded from being required to move to ‘periodic tenancies’, over 700,000 students are currently renting in the House in Multiple Occupation (HMO) market, and the Bill may decrease the HMO supply or increase the rent for students who are currently benefiting from a more affordable HMO rental.
As a result of these changes, students may have to learn how to better budget. Students should however continue to advocate through student unions for better renting practices; PBSA partners might be able to build new accommodation, or improve access with tech-based solutions to address supply problems.
As we navigate these issues, we must reflect on our experiences during the lockdowns and consider what lessons we can learn for the future.
66% of students who participated in the Student Futures Commission survey demanded a hybrid learning approach; we students see the benefits of learning in person and online. Some universities may think that the ‘blended’ approach not only brings opportunities for creating and implementing creative ideas but could narrow the ‘attainment gap’; higher education may become more accessible and inclusive. That is undoubtedly good news. If we could learn online, that raises a fundamental question: Do students need to live on or near campus? What about the option of commuting from home? Some students may find this a more financially sustainable option, as they will not need to pay out for accommodation, which can cost over £250 a week in London,, and could avoid the cost of commuting which will increase every year regardless of the new budget. However, these students may miss the college or student accommodation experience, which may not be replaceable or bought using the money you saved after your first degree.
There are few antidotes to solving the cost-of-living crisis. With the challenges in the coming year even more challenging, we may have to think creatively about sharing living costs with university friends, buying groceries and cooking in batches, replanning our budgets based on the increase in costs, and considering more cost-effective ways of working and studying. While I remain optimistic about how we may adapt and be more resilient to such challenging situations, I started thinking about if we are really solving the challenges with focus on the root causes.
The Budget unfortunately may be unfavourable for students as we will be expecting a slight increase in the tuition fees coming soon. Even with the increase of tuition fees, it might be worth reflecting if such increases may help funding our universities more efficiently, so that we might get more opportunities for those who might be keen to build their careers in academia. Perhaps, a border question we should ask is: How can we transform academia into a more sustainable model that would work with the ever changing global economic environment?