Wisdom is the cornerstone of prosperity – but how much prosperity can it bring? Quite a lot, if that wisdom comes from a college degree, according to a new study by the Economic Policy Institute, which found that US college grads make nearly a hundred percent more than their non-degreed peers. But those numbers don’t reflect the realities of the job market and the costs of getting that degree.
As recently reported by Newser, that EPI study was based on Department of Labor statistics that indicated that college grads overall earn 98 percent more than others in their age group without a degree – an increase from last year’s 89 percent. That should mean that these recent graduates are more than able to hold their own in an economy that’s in recovery, right?
Maybe not. As Jason Hartman says, statistics like that are based on bogus assumptions. Those figures, general as they are, paint a very broad picture that doesn’t take into account many circumstances.
Despite encouraging gains, the employment picture isn’t so rosy, either, especially in some higher end fields. Labor statistics for 2013 indicate the most growth in lower wage jobs such as service industries – and many grads don’t end up finding a job in their area of study right away. That means a period of time working either part time or at a job in a completely different field.
What’s more, global statistics like these ignore another side of the picture: while college grads may make more, they’re also spending that money to pay down the l staggering amount of loan debt that most graduates carry with them out of college – amounts approaching triple digits for some higher end schools. The higher earning power that could come with a degree quickly erodes in the face of paying off those debts – or defaulting, which brings its own set of problems.
Those costs, and the availability of specialized education in technology and commerce, may keep some otherwise qualified students away from choosing to complete a four year degree.
Not all students are equally served by traditional degree programs, and it isn’t clear whether the Labor Department’s earning statistics apply in the same way to students at the top and bottom of their classes – and whether they take into account differences in career choices and the cost of college. Plus, many non-degree jobs pay more than degreed ones. A highly qualified diesel mechanic can command a salary of around $62,000, while a newly minted PhD n English may start out at less than $50,000 annually, while facing far more competition for available jobs.
It’s said that numbers don’t lie – but they can mislead. And the Department of Labor’s numbers on the earnings of college graduates and their non0degreed counterparts paint a misleading picture – one that affects all major areas of the economy. (Top image:Flickr/erdegren)
Spak, Kevin. “College Grads Make 98% More Than Everyone Ese.” Newser. Newser.com 24 May 2014
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