PESTLE Analysis of Higher Education in the UK

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The United Kingdom has one of the most prestigious higher education systems in the world. With educational standards to match the best of the best and comparatively low tuition costs, it’s no surprise that the UK is such a popular destination for tertiary education.

In this article, we analyze the UK’s higher education system with the PESTLE framework, which takes into consideration the Political, Economic, Sociocultural, Technological, Legal, and Environmental factors at play in this industry. Is higher education in the UK really as good as it seems?


Let’s kick things off by analyzing some of the Political factors affecting the higher education scene in the UK:

Public funding

Almost all higher education institutions in the United Kingdom receive some kind of public funding. By means of this public funding, the government is able to partially subsidize the cost of education for the end student. However, the amount of public funding designated towards education — and in particular, higher education — is often a point of contention. Currently, the UK government is slowly but surely cutting down on its education budget, which could prove a serious problem for universities in the future.

Foreign students

It’s worth bearing in mind that the UK is something of a global hub for further education. Almost 20% of students in higher education in the UK are from abroad, and the figure rises to above 40% at the postgraduate level. On the one hand, this is a notable Strength of the UK’s higher education industry, but it may also become a Threat. There’s no doubt that political disagreement could substantially reduce the number of foreign students in the UK, but it’s unclear what effects this would have for the industry itself. Presumably, if the number of students was to fall too low, some institutions would have to consider closing their doors. Of particular note, many of the UK’s foreign students are from the European Union, so it’ll be interesting to see what effects Brexit might have.


As always, there are a number of Economic factors affecting higher education in the UK:

Student debt

Many students in the United Kingdom — especially in England — are forced to take on large amounts of student debt to pay for their degrees. This is becoming something of a problem, since many graduates start off their careers with a severe financial setback. In fact, growing numbers of graduates are simply unable to pay off their loans, which makes the prospect of higher education less and less attractive. However, student debt in the United Kingdom is nowhere near as crippling as in the United States.

Weak job market

Unfortunately, the United Kingdom doesn’t have the strongest job market at present — especially when compared to other major educational hubs, such as the United States or Australia. For many students, of course, the end goal of higher education is to land a well-paid job after completing their degree. These students may wonder why they would want to study in the UK if they can study elsewhere and have more favorable, better-paid career prospects.


It’s time to discuss some of the Sociocultural factors affecting higher education in the UK:

Acceptance of debt

Earlier, we discussed the issue of student debt from an Economic perspective. However, student debt is also a significant topic of discussion from a Sociocultural point of views. Currently, students are very accepting of large amounts of debt. As the Economic issues associated with unpayable loans begin to manifest, it’s likely that new students will take an adverse stance on student debt. If that’s the case, it might seriously reduce the numbers of students in English universities.

Willingness to study

Higher education has long been a must for those looking to succeed in the modern world. Times are changing, though, and many believe that the importance of further education is slowly declining. As a result, we may see fewer and fewer students as more high school graduates jump straight into their working lives. This shift is reflected in the job requirements of many entry-level positions, as they move from favoring a higher education degree to relevant experience.


Let’s take a brief look at the Technological factors affecting higher education in the UK:

Online alternatives

The quality of online education resources is quickly improving. It’s not difficult to imagine a future where vast amounts of educational materials are available online, and maybe even for free. Previously, we discussed how high school graduates may be moving away from the idea of jumping straight into university, instead choosing to pursue a career immediately. It may also be possible that high school graduates forego further education to pursue online learning, which would dramatically affect the traditional higher education industry in the UK.

Augmented learning

Technology isn’t just taking away from higher education. On the contrary, new technologies are allowing us to improve further the education experience in a number of ways. Now, it’s common place for university lectures to be made available online, but the technological revolution doesn’t end there. Technologies like Artificial Intelligence (AI) or Virtual Reality (VR) could change the way we learn at higher education institutions.


We were unable to identify any particularly significant Legal factors affecting the higher education industry in the UK.


Similarly, we couldn’t see any Environmental factors at play in the higher education industry more so than in other industries.

PESTLE Analysis of Higher Education in the UK: Final Thoughts

In this PESTLE analysis, we’ve looked at how various Political, Economic, Sociocultural, Technological, Legal, and Environmental factors are affecting higher education in the United Kingdom. With a large number of foreign students, it’s clear that UK politics play a big part in these universities’ enrollment figures. One of the most notable issues in higher education, cropping up in both the Economic and Sociocultural categories, is student debt, which may come to deter many students. Aside from this, traditional higher education is both threatened and augmented by new technologies, so it’ll be interesting to see how the industry develops over the coming years.

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