Earnings gap makes college essential for millennials
02/17/2014 5:33 PM
02/17/2014 5:34 PM
Never has there been a more compelling argument for teens and young adults to finish high school and get a college diploma.
A Pew Research Center survey of 2,002 adults with a Pew Research analysis of economic data from the U.S. Census Bureau shows a growing economic disparity between young adults with a bachelor’s degree versus those without. The gap has never been greater in modern times.
Millennial college graduates ages 25 to 32 working full time earn about $17,500 more than young adults with only a high school diploma. The study looked at current population survey data collected last year among 25- to 32-year-olds and then examined data among 25- to 32-year-olds in four earlier periods: “the silent generation” in 1965 (ages 68 to 85 at the time of the Pew Research survey and current population survey); the first or “early” wave of baby boomers in 1979 (ages 59 to 67 in 2013), the younger or “late” wave of baby boomers in 1986 (ages 49 to 58 in 2013) and Gen Xers in 1995 (ages 33 to 48 in 2013).
“Today’s millennials are the best-educated generation in history; fully a third (34 percent) have at least a bachelor’s degree,” the report said. “At the same time the share of college graduates has grown, the value of their degrees has increased. Between 1965 and last year, the median annual earnings of 25- to 32-year-olds with a college degree grew from $38,833 to $45,500 in 2012 dollars, nearly a $7,000 increase.
“While earnings of those with a college degree rose, the typical high school graduate’s earnings fell by more than $3,000, from $31,384 in 1965 to $28,000 in 2013. This decline, the Pew Research analysis found, has been large enough to nearly offset the gains of college graduates.”
A lot of factory jobs that paid well in the 1960s and 1970s are gone now. Unions that represented a greater share of workers decades ago have been in full retreat. The Great Recession and anemic recovery also have gut punched job opportunities for millennials.
Getting a college education – despite the high cost and student loan debt – remains the best option.
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