A new measure of lifetime earnings by educational attainment finds the earnings gap between college and high school graduates to be smaller than previous studies have estimated—but still worth the expense of going to college.
In their lifetime, men with a bachelor's degree earn $840,000 more than men with no more than a high school diploma, according to a study in Demography. Their female counterparts earn $587,000 more. These estimates are more realistic than those produced by previous studies, say the authors, because they're based on real earnings over a lifetime: the researchers matched a panel of respondents in the longitudinal Survey of Income and Program Participation to their Social Security earnings records, then compared earnings by educational attainment. Most previous studies of lifetime earnings have been done synthetically, using a snapshot of earnings by age and education from cross-sectional surveys.
Although the financial benefit of a college degree is not the lofty 84 percent found by previous studies, but only 43 percent for men and 51 percent for women, the authors note that a college education is still worth the expense. The $52,000 tuition price tag for a four-year degree (the average in 2010, according to the National Center for Education Statistics) is only a fraction of the lifetime earnings boost college graduates can expect.
Source: Demography, Education and Lifetime Earnings in the United States ($39.95)
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