The Value of a College Degree
If you're paying attention to the national press, you might be wondering whether sending your son or daughter to college is even worth it. A new study sheds some light on that question. Below is a summary, from the Lumina Foundation, of the results of the study done at Georgetown University. Their Executive Summary is available here.
You may also be interested in this discussion by Matt Ferguson, the CEO of CareerBuilder, one of the largest job sites, posted in December of 2013.
From www.luminafoundation.org. College Graduates Lead National Job Growth Recovery, New Georgetown Study Finds
Washington, D.C., August 15, 2012—A new study released today by the Georgetown University Center on Education and the Workforce finds that almost half of the jobs lost in the recession that began in December, 2007 have been recovered and virtually all of those jobs required some form of postsecondary education. Experts say this data demonstrates the ongoing importance of education beyond high school for individual workers and our national economy.
The wage advantage for workers with a bachelor’s degree or better over high school has remained high and has held mostly stable at 97 percent. The wage premium for bachelor’s degrees or better relative to high school degrees skyrocketed from 44 percent in 1981 to a 100 percent in 2005 and has only fallen to 97 percent since the beginning of the recession.
“It is a tough job market for college graduates but far worse for those without a college education,” said Anthony P. Carnevale, the Georgetown Center’s director and co-author of the report. “At a time when more and more people are debating the value of postsecondary education, this data shows that your chances of being unemployed increase dramatically without a college degree.”
The Georgetown study shows that in 2012, seven percent of graduates with a bachelor's degree or better are still unemployed and another 14 percent are underemployed in jobs beneath their skill levels. By comparison, the unemployment rate for new high school graduates is 24 percent and 42 percent for those individuals are underemployed.
Jobs that require bachelor’s degrees have been the big winner, increasing by 2.2 million jobs since the recession began. Those jobs that required some college or an associate’s degree declined by 1.8 million in the recession but have regained 1.6 million of those job losses since the recovery began in 2010. At the same time 5.8 million jobs for those with high school or less have been lost since the recession began.
"In the mid 1970s, less than 30 percent of jobs in America required any education beyond high school,” said Jamie P. Merisotis, president and chief executive officer of Lumina Foundation. “Today, the majority of U.S. jobs require a postsecondary degree or credential. This shift has happened quickly and it demonstrates how vital college attainment is to individual success and our nation as a whole.”
Industries that are postsecondary education intensive, held up best since the recession began. But, there were differences during recession and recovery.
Professional and business services lost college jobs during the recession but that sector has already added over 730,000 college jobs during the recovery.
Government jobs held up during the recession (adding nearly 80,000 college jobs), but collapsed during the recovery due to budget cuts (so far 14,000 college jobs have been lost since the recovery began in January 2010).
Since the recession began, the healthcare industry has added over one million jobs for people with two-year and four-year college degrees.
Even in low skill blue collar sectors, which took the brunt of the recession, college educated workers were favored. For example, in manufacturing, employment dropped 15 percent for people with high school diplomas and only one percent for those with bachelor’s degrees or better. In construction, employment dropped 25 percent for those with high school diplomas and only two percent for workers with a bachelor’s degree or better.
The recession and recovery have affected college men and women differently.
Male college workers were hardest hit during the recession due to private sector job losses. But men led the recovery, including the recovery in the market for college graduates (adding 2.3 million college jobs).
In both the recession and during the recovery, the female labor market shifted decisively toward jobs requiring a bachelor’s degree, having added 1.6 million jobs.
Findings also show that the rate of college enrollment jumped sharply, peaking in 2009 but has fallen off rapidly since then. The recession, however, was a college wake-up-call for men. After lagging behind for decades, since 2006 the rate of increase in male enrollment has caught up and slightly surpassed the rate of increase in female enrollment.
The College Advantage: Weathering the Economic Storm comprises a full report and an executive summary; both documents are available online at http://cew.georgetown.edu/collegeadvantage.