Student Finance and Wellbeing Study Scotland 2023/24: literature review

5. Other forms of income

To supplement their income from SAAS and/or their college or university, students also rely on a range of other sources of income which are explored below.

5.1. Paid work

The majority of students undertake some form of paid work alongside their studies to supplement their student funding. In 2022, a survey by NUS Scotland of 3,528 Scottish students from 34 institutions found that 74% of HE students did so, followed by 65% of postgraduates and 50% of FE students (NUS Scotland, 2022). The most recent Student Income and Expenditure Survey research from England in 2021-22 found that lower proportions of full-time HE students in England undertook paid work alongside their studies (58%), though this has risen from 52% in 2014-15 (NatCen, 2023).

In terms of the number of hours worked alongside studying, Scotland’s Independent Committee of Inquiry into Student Finance (known as the Cubie Commission, 1999) recommended students work no more than 10 hours per week. Today, Student Information Scotland recommends that students work around 10-15 hours of paid work per week, while the Independent Review of Financial Support for Students in Scotland (Scottish Government, 2017) notes its support for the Cubie Review’s recommendation of ideally no more than ten hours per week during term-time. However, recent surveys have found only a third of Scottish HE, FE and PG students worked fewer than the recommended 10 hours per week (NUS Scotland, 2022). Higher proportions of FE students worked more than 20 hours per week compared to HE and postgraduate students (NUS Scotland, 2022). NUS Scotland’s most recent survey (2023) found a fifth of students were working more than 20 hours per week. Across the UK, a survey by the ONS found that the majority of students (45-47%) worked between 10 and 20 hours per week, with 15% working between 20 and 30 hours per week, an overall increase in working hours since 2021 (ONS, 2022).

The data outlined above suggest that higher proportions of Scottish HE students are in paid employment while studying, and work longer hours, than their counterparts in England. However, the extent to which the NUS Scotland survey can be considered representative of the student population as a whole is unknown.

Students are often employed in the service industries, where work can be seasonal or insecure. NUS Scotland’s survey of students in Scotland (2022) found 33% of students were employed on zero-hours contracts, with a further 10% undertaking casual or gig work (e.g. Uber, Deliveroo). A survey of students from Russell Group universities, administered by the Russell Group Students Union (2023), found 23% of students aged 16-24 were on a zero hours contract. This may increase pressure on students to take work while they can, which can lead to students missing classes to undertake paid work, or missing deadlines because their paid work hours are too high: the Sutton Trust (2023) found that 49% of undergraduates had missed classes to undertake paid work, and 23% had missed a deadline or requested an extension.

Student surveys (NUS Scotland, 2022) and qualitative interviews with widening participation HE students (Minty and Vertigans, 2021; Howieson and Minty, 2019) highlight the sometimes detrimental impact of part-time work on their ability to study. Students reported that the stress and exhaustion from working long hours left them with no energy or time for studying. Research undertaken for the Scottish Government with estranged students (Minty et al., 2022) also highlighted the pressure to balance work and study, and the ways this impacts on estranged students’ mental health, and their risk of dropping out. The pandemic and its associated lockdowns meant some students lost income and employment as a result of lockdown restrictions (especially in the hospitality and retail sectors), while others found it hard to access the kinds of casual work students often rely on (Scottish Government, 2020). Research on students’ paid work in Scotland tends to focus on university students, with limited data available on college students. Lowe and Gayle’s (2014) analysis of survey data collected from students in a Scottish college is therefore more unusual. They found young part-time students (under 25), many of whom were apprentices and had their fees paid by their employers, were more likely to be able to balance the demands of work and study. Young full-time HNC/HND students, had less finances to draw upon than the apprentices, and found it harder to balance paid work with their studies.

5.2 Parental contributions

A key source of income for students, is that of financial contributions from parents, guardians, carers, or other family members. While student loans are administered to individual students, the amount they receive if they are under 25 is determined by the income of their household, or in many cases, their parents’ income. In Scotland, students aged under 25 whose household income is £34,000 or more receive the minimum loan and no bursary (in 2023/24, the loan was £6,000), with the underlying assumption that parents will make some financial contribution to their child’s HE costs.

Parents’ cultural and economic resources, and their attitudes to the costs of HE and student loans, informs the degree to which they are willing and able to contribute to the studying costs of their children (Lewis and West, 2017). Parental attitudes to the costs of HE and student loans, can also play a significant part in influencing their children’s attitudes to student loans. Qualitative research with students and their parents in Scotland undertaken by Minty (2021), and prior to that by Christie et al. (2001) and Christie and Monroe (2003), found that some parents were debt averse, particularly those who have not been to university themselves. These parents discouraged their children from taking out student loans, and instead encouraged them to reduce their costs by living at home.

Support from parents and other relatives can be regular (e.g., paying rent, providing a monthly allowance), ad hoc (contributing towards large cost items, helping with a bill) or in-kind (e.g., provision of bed and board for those living at home), but the exact role parents play in supporting their student children financially has been under researched, especially in Scotland. In the 2023 RBS Student Living Index, 42% of respondents said they used income from their parents/family to pay their rent. Recent research undertaken in Scotland (Minty, 2021) with students and their parents showed how affluent parents sought to ensure their children graduated debt-free by paying all or most of their study costs. Research undertaken for NUS Scotland (2022) highlights the challenges faced by students whose household incomes are such that they are not entitled to higher loans/bursary, but whose parents are either unable or unwilling to help support them financially. For those unable to access parental financial support, there is a far greater reliance on part-time work (Minty et al., 2022). In England, 78% of full-time HE students (and 73% of part-time HE students) responding to the SIES survey in 2021-22 received financial support from their families, down from 81% for full-time HE students in 2014-15 (NatCen, 2023).

5.3. Social security benefits

Social security benefits are also a key source of income for some FE and HE students. Most full-time students are not eligible to claim social security benefits. However, the following full-time student groups may be eligible: estranged students aged under 22 who are studying an FE course; parents; students living with a partner who is not a student, and some students with a disability. The amount of benefits students in these groups receive is dependent upon, in most cases, how much financial support a student accesses through their student funding (from SAAS or their college). An exception to this is disability benefits which are not calculated based on income.

For students studying at FE level, it is more likely they will be able to remain on benefits while studying, because FE student support is discretionary which often results in lower levels of student support. Colleges may ‘top up’ benefits with the FE bursary.

HE students who are eligible for benefits are expected to access any student support that they are eligible for before applying for social security benefits, and this can have an impact on the amount of social security benefits they then get (and can even end benefits completely). There is also often a gap between benefit payments ending and student support payments beginning, creating further vulnerability and hardship for students in this position (Scottish Government, 2017).

Postgraduate students in particular groups, such as those with children or disabilities, may be eligible for some social security benefits.

As found in the 2007/08 Scottish Student Income and Expenditure Survey (Scottish Government, 2009), benefits were an important source of income, particularly for part-time students, who reported an average of £1,245 income per academic year from benefits. Those with children also reported a much greater income from benefits (£1,802 full-time; £2,327 part-time) than those without children (£51 full-time; £818 part-time). Despite the importance of benefits as a source of income for students, the process of applying for benefits can be complex, difficult to understand and inaccessible (Scottish Government, 2017). A survey of students’ financial experiences over summer 2021 (Scottish Government, 2022a) found that 25% of student respondents did not know whether they were eligible to apply for social security benefits for living costs of the summer months.

5.4. Commercial debt

In some cases, student funding and part-time work is still not enough to cover students’ living costs. The UK-wide Student Money Survey (2022) found that the discrepancy between the average amount of student funding received was £485 per month, while the average monthly living costs were £924, leaving a shortfall of £439 per month; as the average income from part-time work comes to £422 per month, this shortfall is still not covered by students taking up part-time work. This discrepancy can lead to students turning to commercial loan sources to pay for essentials, with NUS Scotland (2022) reporting that almost a third of students had accessed commercial loans. Almost a third (31%) of students responding to this NUS Scotland survey (2022) had used credit cards, Clearpay/Klarna, and payday loans while 25% had used a bank overdraft. The survey found the most common form of debt was informal debt, with 45% of students responding to the survey saying they had sought a loan from friends or family. However, not all students are able to turn to these networks for support, and must turn to sources of credit. Students from some widening access groups (e.g., estranged, care experienced students) may be more likely to have to seek these types of additional funding, increasing their vulnerability to financial hardship and precarious financial situations. Research for Stand Alone, the organisation which provided advice and guidance to estranged students, found these students may be more likely to accrue high levels of debt, credit card use and payday loans (Bland, 2015). This is borne out in surveys of students in Scotland (NUS Scotland, 2022; 2023) which show higher levels of debt among students who are estranged from their parents.