Is a College Degree Worth It These Days?
There are few people who haven’t been affected by the downtrodden economy over the past several years, whether it was a loss of investments, a requirement to keep working despite being eligible for retirement, or simply tightening the budget. But of all those, the conversation seemed to linger the longest around whether or not a college degree was helpful in the job market. Should soon-to-be graduates wait out the storm another year and go on to graduate school? Would it even help to have a degree, instead of just a high school diploma?
From 2000 until 2013, the unemployment rate was consistently higher across all age groups for people who had less than a bachelor’s degree in college. The push to get a degree made sense: At the beginning of 2013, for example, the National Center for Education Statistics reported the unemployment rate for young adults (ages 20 to 24) was 29.2% for those who didn’t finish high school. The rate was 17.5% for those who completed high school, 12.2% for some with at least some college, and a low of 7% for those with at least a bachelor’s degree.
But the statistics became grim for the class of 2013. “In 2013, for young adults ages 20–24, there was no measurable difference in the unemployment rate between males and females among those whose highest level of education was less than high school completion, those with some college education, and those with at least a bachelor’s degree,” the report found. For its purposes, the center considered people unemployed when they were not working but had made specific efforts to find employment sometime during the prior four weeks.
Around the spring graduation season in 2014, the Economic Policy Institute also took a look at unemployment rates of young adults. The rates were improving compared to previous years, but still weren’t a pre-recession levels. For college graduates, the unemployment rate was 8.5%, compared to 5.5% in 2007. But that was still higher than the unemployment rate of high school graduates, which was 22.9%. The institute did also remind readers that the unemployment rate for younger workers does tend to be higher than older employees, no matter the economic climate. Even at an all-time low in September 2000 for the larger labor force, the unemployment rate of younger workers was 8.9% compared to the entire population at 3.9%.
But a study with preliminary findings released in late February 2015 shows that college graduates from the class of 2014 did in fact find jobs in greater quantities than their counterparts. And what’s more, a revamping of the study suggests that more reliable data on the impact of a college degree will be available in future years, too. The National Association of Colleges and Employers reworked its survey criteria for the 2014 data, and collected more comprehensive data on whether graduates were finding full-time, part-time, or other types of working situations. A finalized report is expected in June 2015.
According to the Wall Street Journal, the organization had allowed colleges to survey their students anywhere from a week to about a year after graduation. Instead of that enormous span of time, the average survey time in 2014 was about seven months after graduation. “The new approach to data collection highlights the growing focus on measuring outcomes in a scientifically sound way as the value of a college degree has come increasingly into question amid rising costs and soaring student debt,” the Journal reported.
Of the 66,629 college graduates of 2014 interviewed, 52.9% of those with a bachelor’s degree had found full-time work. About 16.8% had moved on to graduate education, 7.3% had found part-time work, and 18.7% were still seeking some sort of job. (Other smaller categories included those in the military, those who had an internship, and those who weren’t seeking employment). The study was also able to break out the median starting salaries based on level of education: Doctoral students began earning $49,974, master’s students earned $42,932, and Baccalaureate students earned $38,353.
The concern for college graduates at the Economic Policy Institute is not solely about the employment rate, but also about what positions those graduates are receiving. The institute points out that even in favorable economic times, college graduates work in jobs that do not require their college degree. In 2000, for example, 36% of college graduates ages 22-27 worked in a job that did not require their college degree. But by 2012, that figure was at 44% and has yet to improve, despite a strengthening economy. The wages are also a continuing concern for the institute: When adjusted for inflation, the wages of college graduates have dropped 6.9% since 2007.
It’s not a guarantee that a college degree will automatically mean good job placement or an above-average salary. And the economy needs to continue to pick up in order to support the flood of college graduates each spring. But though there’s much work to be done, the slight uptick from years prior show promise for the class of 2015 and beyond.
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