Did you send your child off to study at a university this fall? Are you wondering if all this education will pay off? A July 2002 publication from the U.S. Census Bureau should resolve your questions.
The report, "The Big Payoff: Educational Attainment and Synthetic Estimate of Work-Life Earnings," compares educational achievement and estimates annual and lifetime salaries (in 1999 dollars). A typical work life is defined as the period from age 25 through age 64; the average estimated annual salary for all workers is $34,700. High-school dropouts earn an average of $18,900, high-school graduates average $25,900, college graduates average $45,400 and workers with professional degrees such as medical doctor or dentist earn an average of $99,300.
The earnings differences based on educational completion has grown. In 1975, full-time, year-round workers with bachelor’s degrees made 1.5 times as much as workers with high-school diplomas. By 1999, workers with bachelor’s degrees made 1.8 times more than high-school graduates. This spread was even more dramatic when workers with master’s, professional, and doctorate degrees are compared to high-school graduates. The workers with advanced degrees made 2.6 times more than those with high-school diplomas.
At the same time, the average earnings of workers without high-school diplomas dropped from .9 times the earnings of high-school graduates to .7 times the average earnings of high-school graduates. One of the major events that has contributed to these earnings differences is the need for workers who are more highly skilled and educated to meet new technology challenges.
Over a 40-year work history, a worker without a high-school degree might earn $1 million; a high-school graduate might earn $1.2 million; individuals with some college, $1.5 million; those with an associate’s degree, $1.6 million; a bachelor’s degree, $2.1 million; master’s degree, $2.5 million; doctorate, $3.4; and a professional degree, $4.4 million.
One area of education not covered by this report is vocational education and skills training. Not everyone must get a college education to earn a good salary. People who add additional training in skilled trades such as plumbing and auto mechanics can find jobs with substantial opportunity for salary growth.
Money doesn’t buy everything, but it can make life easier in many ways. Let your children know that their hard work will pay off. You can find a copy of this report on the Web at http://www.census.gov/prod/2002pubs/p23-210.pdf.