Data Shows Great Variation in College Results, Earnings
May 15, 2013
Statistics have commonly told people that those with college degrees make significantly more money in their lifetime than those without. Plenty of scientific studies reaffirm these statistics while teachers and politicians reinforce that college is necessary for success in the modern economy. Unfortunately, not all colleges and college degrees are equal and not all children should attend college, says Stephanie Owen and Isabel Sawhill of the Brookings Institution.
- Certain schools, majors, occupations and individuals may not be the best investment.
- There are many considerations in evaluating the rate of return on education, including the cost of college, the opportunity cost of the time spent in college and forgone earnings.
- One estimate places the opportunity cost of getting a four-year degree at $54,000.
The gap between young high school graduates and bachelor's degree holders working full time is $15,000 annually. The gap grows significantly, so that by age 50, bachelor's degree holders average $46,500 more in annual earnings than high school degree holders.
- If tuition plus the opportunity cost of college is an estimated $102,000, then the estimated $570,000 in additional lifetime earnings that a bachelor's degree holder earns certainly makes college worth it.
- The more competitive a school, the greater return on investment for a bachelor's degree.
- In descending order, engineering, computers and math, science, business, physical science, social science, communications, biological sciences, literatures, liberal arts, psychology, arts and education are the degrees that earn the most (or least).
- Over a lifetime, architects will earn almost $3.5 million while an educator will earn less than $2 million.
Graduation rates are also highest at the most competitive schools and as school competitiveness decreases, so too do six-year graduation rates. Making this information more readily available would encourage new college students to choose their degree and occupation carefully. The data also shows that colleges need to do more to ensure that their students graduate.
Sources: Stephanie Owen and Isabel Sawhill, "Should Everyone Go to College?" Brookings Institution, May 8, 2013.
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