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October 7, 2002

Vol. VII, No. 4

Census Report Shows Large Payoff from College Degrees

Bachelor's Degrees Worth Nearly $1M Lifetime Earnings Differential Versus High School Diplomas

For anyone wondering whether the hard work, personal struggles and typical student loan burdens of pursuing higher education are really worthwhile, a new report from the U.S. Census Bureau answers clearly yes, particularly when it comes to a person's likely lifetime earnings.
During an adult's working life, on average, high school graduates can expect to earn $1.2 million; $2.1 million for those with a bachelor's degree, and $2.5 million for those with a master's degree. Those with doctorates ($3.4 million) and professional degrees ($4.4 million) do even better.
"At most ages, more education equates with higher earnings, and the payoff is most notable at the highest educational levels," said Jennifer Cheeseman Day, co-author of the Census Bureau report "The Big Payoff: Educational Attainment and Synthetic Estimates of Work-Life Earnings."
The estimates of work-life earnings are based on 1999 earnings projected through a typical work life, defined as the period from age 25 through 64. The work-life earnings data were collected in the March supplement to the Current Population Survey for 1998-2000.
In 2000, 84 percent of American adults age 25 and above had at least completed high school, but only 26 percent had a bachelor's degree or higher, both all-time highs in the United States.
Some of the report's other findings:

In 1999, average annual earnings were $18,900 for high school dropouts, $25,900 for high school graduates, $45,400 for college graduates and $99,300 for the holders of professional degrees such as doctors, dentists and lawyers.
During a work life, earnings for a worker with a bachelor's degree compared with one who only had a high school diploma increase by about $1 million for non-Hispanic whites and by about $700,000 for blacks, Asian/Pacific Islanders and Hispanics.
Men with professional degrees can expect to cumulatively earn almost $2 million more than their female counterparts through their work lives.
But more American women than men have received bachelor's degrees every year since 1982.
At present, almost 9 in 10 young adults graduate from high school, while about 6 in 10 high school seniors go on to college the following year.

Another Census report released last year ("What's It Worth? Field of Training and Economic Status: 1996") said among people with bachelor's degrees in 1996, those working full time in engineering earned the highest average monthly pay ($4,680) while those with education degrees earned the lowest ($2,802).