College pays updated

The Bureau of Labor Statistics each year publishes a chart that details the unemployment rate and median weekly earnings by education attainment for those 25 and older. The data for 2103 is below.

 

 

education pays 2013

 Each time I look at the new data the question that comes to mind is “how can the data be misinterpreted?”. Seems like the conclusion is crystal clear: the more education attainment the more you work and the more you earn. End of story!

And yet we continue with a public conversation that increasingly questions the value of getting a four year degree or more. The reality is–as this data depicts–is that a four year degree–including with a liberal arts major–– or more is the best path to a middle class or better career.

No one can guarantee anyone a good paying job. The American economy, particularly since the onset of the Great Recession, isn’t creating jobs fast enough to fully employ new entrants into the labor market no matter what a person’s education attainment. But as the data indicate you have a far better chance than those without a four year degree. And that advantage almost certainly will grow over what is likely to be a forty year career.

This is the core lesson Michigan Future has learned during its more than two decades learning how globalization and technology are reshaping the American economy. Economies are cyclical, they go up and down. But the constant is that those with the highest education attainment––with the broadest skills––do best.

Why? Because globalization and technology are increasingly concentrating employment growth and high wage work in the knowledge-based sectors of the American economy. And the asset that is the most valuable to knowledge-based employers and is in the shortest supply is talent.

The value of a college degree is far more than how quickly a graduate gets a first job and how much it pays. These are the short term metrics that fuel the “college isn’t worth it” nonsense. Rather the payoff is over an entire career.

It comes from having skills that give you a competitive edge in all industries and most occupations, in having skills that may not be in demand today but will be in the future and in learning how to learn so that you can better spot new opportunities and take advantage of them in a constantly changing labor market.

Building a foundation to do well over a long career is only going to grow in value in an economy where technology and globalization accelerate creative destruction. Destroying jobs and occupations and creating new, unimaginable, jobs and occupations at a quicker and quicker pace. As we describe it, successful careers will go to those who are good rock climbers, rather than ladder climbers. Those who are able both to constantly spot opportunities in a constantly changing world and have the agility to take advantage of those opportunities. Far different than career success in the past which were build around known and stable rungs of a career ladder.

 

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Lou Glazer

Lou Glazer is President and co-founder of Michigan Future, Inc., a non-partisan, non-profit organization. Michigan Future’s mission is to be a source of new ideas on how Michigan can succeed as a world class community in a knowledge-driven economy. Its work is funded by Michigan foundations.

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