How Much is a College Degree Worth?
The evidence is clear: the more you learn, the more you earn. The Bureau of Labor Statistics (BLS)’s Earnings Data by Educational Attainment (last updated for the second quarter of 2018) reports the median salaries for workers age 25 and older increased markedly with the education level that they have attained. Earning a college degree continues to be a wise way to heighten your future earning potential, lower your risk of unemployment, and maximize your levels of eventual job and life satisfaction.
How Much Is a College Degree Worth?
Even though the average salary increases significantly based on degree level, keep in mind that these figures only capture general averages and will not hold true in all cases.
Be careful to evaluate the salary implications for acquiring a particular degree based on your unique strengths and geographic location prior to enrolling in a college program.
For example, a young woman with a strong mechanical aptitude who struggles with traditional academics might earn more pursuing an apprentice position as a plumber than by acquiring a bachelor's degree.
By the same token, though, demand for particular career paths (and the salaries that employers are willing to pay) may vary significantly depending on where you live. In North Carolina, for instance, a plumber averages $57,996 a year. The same job, however, only earns $51,340 in New Jersey and $49,890 in Hawaii.
The economic climate of your particular state or region (assuming that you wish to remain in your state of origin) may thus be a key factor in determining whether the expenses associated with a college education are “worth it.”
Median Salaries Listed by Level of Education
- Individuals who did not complete high school: $28,808
- High school diploma: $37,752
- Some college or associate degree: $42,900
- Four-year degree only (with no graduate work): $61,724
- Advanced degree: $78,624
Salaries for Jobs That Require Degrees
Job search engine Indeed.com (2015) took a look at job postings to determine how many organizations that are hiring require an advanced degree, and what the salary differential is for various levels of education.
Here's what the results show:
- Jobs requiring a bachelor's degree paid an average salary of $65,000
- Jobs requiring a master's degree paid an average salary of $82,000
- Jobs requiring a PhD paid an average salary of $97,000
- Jobs requiring an MBA paid an average salary of $95,000
To recap, each degree beyond a bachelor's is worth about $15,000. However, there are fewer job postings for applicants with advanced degrees.
Educational Level and Lifetime Earnings
The Social Security Administration reports that men with a bachelor’s degree earn $900,000 more during a lifetime than men with a high school degree. Women with a bachelor’s degree are estimated to earn $630,000 more than women with a high school degree. Men with a graduate degree earn $1.5 million more on average than high school graduates, while women with graduate degrees earn $1.1 million more.
Educational Level and Unemployment
Another way to gauge the value of a degree is to examine the unemployment rate for individuals possessing that credential. According to BLS data updated in September 2018, the unemployment rates by educational level were as follows and clearly show reduced rates of unemployment as the level of education increases:
- Individuals who did not complete high school: 4.9%
- High school diploma: 3.5%
- Some college or associate degree: 3.1%
- Four-year degree or higher: 2.0%
Educational Level and Eventual Life Satisfaction
While eventual job security is something every person should consider when weighing the value of college costs, most Millennials are also focused upon other, less tangible issues: job satisfaction, work/life balance, and freedom for positive community engagement and outreach.
In a 2016 College Board report, researchers found that college graduates tend to embrace healthier lifestyles than non-college graduates, reducing their eventual health care costs while at the same time allowing them to contribute productively to their communities:
- 69% of college graduates, as opposed to 45% of high school graduates, reported exercising each week vigorously
- 39% of those with a bachelor’s degree volunteered in 2015, as opposed to 16% with a high school diploma
- 45% more college graduates voted in the 2014 midterm election than did high school graduates (20%) in the same age group
- The children of college graduates were more likely to be involved in a variety of educational activities with their families.
The College Board also reports that four-year college graduates who enroll at age 18 and graduate within four years typically earn enough by age 34 to compensate for having entered the workforce four years later than high school graduates.