Thursday, October 30, 2014

Chart: College really does pay for most people

We've all seen the data showing that college pays off: it means lower unemployment and higher pay than people with high school diplomas alone usually get. But still there's a constant debate over whether everyone really has to go to college: a bachelor's degree can't possibly leave everyone better off, right?

In a recent blog post, the Labor Department put together numbers that help clarify the answer to this question. The numbers confirm that yes, there are some high school graduates who do better for themselves than a whole bunch of people who get through four years of college.

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Clearly, there are some people who do just fine without a college degree. The people in the top 10 percent of high school graduates earn more than $250 more per week than the median college earner, for example. Those people also earn about the same as even the median person with an advanced degree.

But this chart emphasizes two important facts: one is that your chances of being paid well are simply far better with a college degree than with a high school diploma. Even the people in the 10th percentile of earners with college degrees are earning $520, 41 percent more than the 10th percentile earners with high school educations.

The other important point is the spread of earnings that bachelor's degree and advanced-degree holders have when compared to everyone else in the economy. Part of that could be the wide range of degrees that people out of college can get — engineering majors tend to earn far more than social work majors, for example. But it also reflects that there's high earnings potential for someone with a degree. Getting a college education may get someone a low-level, low-paying job out of college, but that person could easily have far more room to grow her paycheck over the course of their career than a person without a degree.

And all those paychecks can add up: the Federal Reserve found earlier this year that a college degree is worth $830,000 more over the course of a career than a high school diploma.

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