FRB-NY examined the the economic costs and returns of college since 1970, finding that individuals earning either or both degrees earned a rate ~15% higher over 10 years. This "premium" continued despite rising student loan debt and high-paying jobs for graduates becoming increasingly more difficult to find. Ajdusting for inflation, between 2001 and 2013:
- Those with bachelor's degrees between earned an average of $64.5k/year.
- Those with associate degrees averaged about $50k/year.
- Those with only a high school diploma averaged $41k/year in income.
Don't be surprised to hear the President of the United States tout these data and for his lemmings in the mainstream media to do the same. After all, they believe a college education is a basic "right" guaranteed by the U.S. Constitution to every citizen and illegal immigrant. "Without a college degree," they will opine to thunderous applause and foot stomping, "income inequality will continue destroying the hopes and dreams of the poor, the middle class, and every illegal immigrant, leaving the 99% further behind the 1%."
What they won't be touting, however, is the other part of the FRB-NY report which argues that the college degree "premium" remains because the wages of those possessing only a high school diploma have also fallen. Ajdusting for inflation, between 2001 and 2013:
- The average wage of workers possessing a bachelor's degree declined 10.3%.
- The average wage of those possessing an associate's degree fell 11.1%.
- For those possessing only a high school diploma, the average wage dropped 7.6%.
What do these data indicate?
Do the math:
- 10.3% of $64.5k = $6,643.50 (gross pay declined to $57,856.50)
- 11.1% of $50k = $5,500.00 (gross pay declined to $44,500.00)
- 7.6% of $41k = $3,116.00 (gross pay declined to $37,844.00)
Now some analysis:
- Had the average wage of associate and bachelor degree earners held steady, the President's rhetoric would be more persuasive.
- However, those wages did not remain steady. Thus, adults with a bachelor's degree have retained a ~53% wage premium over those with high school diplomas only. Likewise, those with an associate's degree earned ~22% more than those with high school diploma's only.
Don't expect to see that math figure into the analysis touted by the President or his lemmings in the mainstream media. No, those inconvenient facts indicate that all of those people in the audience are earning less than they did when the President first assumed office in 2009 and earning an associate or bachelor degree isn't going to change that fact or the wage gap.
Of course, it's all President George W. Bush's fault.
Let the discussion begin...
To read the FRB-NY report, click on the following link:
"Do the Benefits of College Still Outweigh the Costs?"