College Degrees Still Correlate to Higher Wages

September 12, 2019
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Author: Stephanie Ludwigsen

Post-secondary education is the logical career path for the majority of graduating high schoolers, but the reasons young adults head off to college is evolving. Where once seen as the next logical step, today’s college freshman are taking their educational responsibilities much more seriously as a precursor to just how profitable their careers will be.

Higher Education Still Valuable Wage Growth Tool

Better Wages

Sure, college promotes life lessons, good times and long-lasting friendships. But when it comes to the pragmatics behind university life, career trajectory and most certainly wages, are the main reason people pick the classroom.

Even with the value of college degrees under a microscope, college graduates earn about twice as much as high school graduates over the course of their career, proving that the mantra, “the more you learn, the more you earn,” still rings true. For example, a working professional with a high school diploma earned a median annual wage of $36,100 in 2017 (the latest data available) while someone with a bachelor’s degree earned a median annual wage of $72,830 for the same timeframe.

A degree is also a competitive differentiator in many industries, particularly during economic times where layoffs and cuts are inevitable. There is also a strong correlation between educational level and employment rate. Historically, high school diploma holders see an employment rate of around 4.6 percent, while those with a bachelor’s degree see that figure drop to just 2.5 percent. (For further comparison, doctorial and professional degree holders see unemployment rates of just 1.5 percent.)

College Enrollment Still Climbing

While only 60 percent of students in school will actually graduate with their degree, enrollment figures for U.S. universities continue to climb, and they’re projected to keep growing over the next decade. In addition, 2019 is the first year that the majority of the college-educated labor force, 50.2 percent to be exact, will be comprised of women. Women also earn 57 percent of all bachelor’s degrees.

The Right Career Choice

A recent survey found that two out of three Americans have some regret about their educational choices, and for many, those feelings are tied to the necessity of paying back student loans.

As the nation slides into a $1.6 trillion student loan debt, it’s no surprise that payback is top of mind for Americans. About 27 percent of those surveyed said their greatest regret about their education is student loans while about 12 percent say it’s their chosen area of study. These figures reiterate the importance to selecting their right field of study, particularly when income potential can offset the front-end cost of getting the education.

Today, more than 33 percent of Americans over the age of 25 have a college degree—the highest number in history. As the labor market tightens and the competition for jobs heats up, selecting the right course of study for a productive job trajectory is the key motivator for tomorrow’s young professionals.

For those professionals already in the workforce or for educators and counselors helping students plan their career trajectory, providing advice on field of study along with the long-term value of a degree is important, not just for job longevity and wages, but for overall career satisfaction.