Lifetime Earnings: College Graduates Still Earn More
October 18, 2012
Using data from the 2011 American Community Survey (ACS) the Census Bureau has released findings on differences in lifetime earnings of bachelor's degrees in two survey briefs last week.
The first, "Work-Life Earning by Field of Degree and Occupation for people with a Bachelor's Degree: 2011," examines individuals whose highest degree attained is a bachelor's degree. The major or field of the degree was found to have a relationship with the earnings over a lifetime. Knowing that small differences in salary turn into big differences in earnings over a lifetime of working, the U.S. Census Bureau developed an algorithm, the Synthetic Work-Life Earnings (SWE) estimate, to illustrate the differences over time. While the report notes that individuals start and stop their careers at different times and switch careers, and thus the estimates are not an exact prediction of how much a person can expect to make in a particular field, they defend the SWE estimates connecting a person's educational impact on occupational outcomes.
Findings show that there is a $1 million difference in high school graduates' earnings and those whose highest education is a bachelor's degree. There is another $1 million difference between those with a bachelor's degree and those with a doctorate. On average, a bachelor's degree recipient can expect to earn $2.4 million over their lifetime.
Full-time, year-round workers aged 25-64 make up 20 million individuals and represent a great variety in earnings by their degree type and occupation. Those individuals with a bachelor's degree in fields such as: engineering; computers and math; science and engineering related; business; physical science and social science that had careers working in the fields of: architecture and engineering; computers and math; management; business and finance; sales and related; and science all earn above the average lifetime earnings of $2.4 million of bachelor's degree recipients.
Those with lower than average lifetime earnings were those individuals working in the following occupations, regardless of the major/field of study of their bachelor degree: natural resources, construction and maintenance; production, transportation/material moving; education; community service and legal; office support; and service.
Not all individuals in a particular field of study earn the same amount. For example, a liberal arts graduate who goes into a career of computers/math, management, or business earns between $2.6 and $3 million dollars -- well above the average lifetime earnings of a bachelor's degree recipient. However, if a liberal arts graduate goes into a career of education, office support, service, or production, transportation/material moving, they can expect to earn between $1.4 and $1.8 million dollars. Not surprisingly, those whose highest degree is a bachelor's in education make the least no matter what occupation is chosen. In fact, "education majors working in service jobs earn less than people whose highest attainment is a high school diploma."
A companion report, "Field of Degree and Earnings by Selected Employment Characteristics: 2011" looked at gender differences and broke the population down by self-employed individuals and wage and salary workers as well as bachelors versus advanced degree earners. For those whose highest degree was a bachelor's they saw greater lifetime earnings as wage and salary workers than as self-employed workers. However, the reverse was true for most of those with advanced degrees. With the exception of education and business degrees, all other advanced-degree holders saw higher earnings as self-employed professionals than as wage and salary workers.
The two American Community Survey Briefs, "Work-Life Earning by Field of Degree and Occupation for People With a Bachelor's Degree: 2011" and "Field of Degree and Earnings by Selected Employment Characteristics: 2011" can be downloaded from the U.S. Census newsroom site.
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