The combination of the high and ever-rising price tag for a college education and the less-than-promising job prospects for new grads are fueling a hot debate about the value of a bachelor's degree: Is it actually worth the money?
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Well, a new study from the Census Bureau, Education and Synthetic Work-Life Earnings Estimates, answers that question with a resounding yes. According to the study, education levels had more effect on earnings over a 40-year span in the workforce than any other demographic factor such as race or gender. The estimated impact on annual earnings between a person with a professional degree versus one without a high school diploma was about $72,000 a year. By comparison, the gap between men and women was just $13,000 -- less than a fifth as much -- reports the Census Bureau.
Certain folks do benefit more from higher education than others. For example, according to the study, non-Hispanic white males, Asian males and Asian females record bigger salary gains than others from higher levels of education over the course of a career. White men with professional degrees overall career earnings are more than double what Hispanic females with the same piece of paper make -- averaging about $2.4 million more.
The Census Bureau isn't saying that race, gender, citizenship, English-speaking ability or geographical location don't matter -- they do. But none of them packs the salary punch that education does.
"This analysis shows that there is a clear and well-defined relationship between education and earnings," said Tiffany Julian, an analyst in the Census Bureau's Housing and Household Economic Statistics Division, in a prepared statement. "The overall economic value of educational attainment in this report supports the belief that higher levels of education are well-established paths to better jobs and higher earnings."
The study had a few other goodies to chew on, which the Bureau highlighted in its press release:
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Overall, white males had higher earnings than any other group at every education level, with the exception of those with a master's degree, which was topped by Asian males, and those with a professional degree, where Asian males were not significantly different from white males. ...
In general, women in the most economically advantaged race groups usually earn less than men in the most disadvantaged race groups. For example, a white female with master's degree is expected to earn $2.4 million over a 40-year work-life. In comparison, a Hispanic male with a master's degree is expected to earn $2.8 million. ...
For Asian, black and Hispanic groups whose highest education completed is high school, the difference between each group's work-life earnings was not large compared with the differences between these groups when they had higher levels of education. ...
Language spoken at home had an effect on earnings: those who spoke a language at home other than English saw a decrease in annual earnings after considering all other factors. Even those who speak English "very well" saw a decrease of $989 in annual earnings compared with English-only speakers
When your mother told you, "Don't be a fool, go to school," as usual, she knew what she was talking about.
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