Higher education still pays off
The economic downturn and recession of recent years has prompted many to abandon plans to pursue or complete a college education, as the struggling job market left recent college grads unemployed or working entry-level jobs. But a new study from the Pew Charitable Trusts finds that a college degree is still worth it, even in a struggling economy. "All 21-24 year olds experienced declines in employment during the recession, but those declines were considerably more severe for those with less education," says Diana Elliott, research manager for Pew's Project on Economic Mobility.
The study used U.S. Census data to compare job and salary levels for people ages 21 to 24 before and after the economic recession of 2007 to 2009. It found that the unemployment rate increased by 16% for those with only a high school diploma, as opposed to 7% for those with a bachelor's degree. As for wages, the research found they declined by 10% on average for high school grads, but by only 5% for those with four-year degrees. Elliott says the findings go beyond that, revealing that those with at least a bachelor's degree will have more job options and a higher overall earning potential. "A college degree is still incredibly important, not only for labor market outcomes, but also for these mobility prospects in the future," she says.
One of the more interesting findings of the study was that overall school enrollment rates did not increase during the recession. The study didn't examine the reason for that, but economists speculate it was likely due to declining family wealth combined with the increased cost of higher education. But the overall message of the study comes down to one thing...hitting the books still pays off in the long run. "Across the board, college graduates experienced better employment outcomes in terms of unemployment rates, the quality and skill level of the jobs, and the wages earned," says Elliott.
Read the full Pew "Economic Mobility" Report Here.