Education attainment and employment

The Census Bureau using data from the 2010 Current Population Survey just released what they describe as “the most detailed information on years of school completed ever presented by the Census Bureau”. It is worth looking at. Lots of interesting data on education attainment by age, race, gender, etc.

What I want to focus on today is the relationship between employment and education attainment. All of sudden there seems to be lots of chatter about college attainment not being all that valuable in the labor market. Don’t believe it! The CPS data, because it is the survey used to determine the monthly unemployment rate, allows us to look at employment by education attainment.

What are the facts? The average unemployment rate for all of 2010 was 8.9%. Here is what it looks like by education attainment:

  • Less than a high school degree: 16.4%
  • High school degree: 11.9%
  • Some college, no degree: 9.6%
  • Associates degree: 7.3%
  • Bachelors degree: 5.4%
  • Masters or more: 3.5%

So much for a college degree not mattering much in the labor market! Add to that the same lock step progression in terms of wages and salary – the higher the education attainment the higher the average employment earnings – and the case is overwhelming that education attainment is by far the most reliable route to a job and higher pay in both recessions and expansions. End of story!

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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.

This Post Has 4 Comments

  1. It’s certainly the end of -a- story: that a very good way for an individual to improve her lot in the job market is to get a college degree.

    The story that is often conflated with this one, however, remains murkier: that a very good way for a large economy to perform better is to increase the number of people with college degrees. To my mind, the above figures don’t say much either way about that story.

    1. Agreed. These data are about individuals, not communities or the country. For regions and state most of out work has been about making the case that the most prosperous places in the country are those with the highest proportion of adults with a four year degree. See our Annual Progress report on the website. Of the 15 states with the highest college attainment levels 13 are also in the top 15 in per capita income. It is by far the best predictor of state’s income. For the nation it almost is there is no alternative. Globalization and technology – not policy – are making the economy more knowledge-based. This is a two decade long trend. And it is only going to accelerate. So the places in the country that do the best will be those that align with – rather than resist – the trend.

  2. I think I commented on this before, but people in Michigan need to see the degree for what it represents. (It’s not “just” a piece of paper – and if that’s all it is, then that says more about the person who received it, not the education.) Most college grads come out with a network of contacts via professors, internships, classmates, and professional/social groups. Michigan’s problem isn’t just out-migration, but also talent attraction (in-migration). The Urbanophile just had a repost about the danger of “boomerang” residents – those who left and came back, but Michigan’s small communities seem to be relying on people getting fed up of their city life in Seattle/Chicago/NYC/DC/SF and then coming back. When I go back home (my husband and I live in NYC), everyone keeps telling us that “when we have kids, we’ll move back” which is a) untrue and b) a weird prediction.

    The real question is how to attract people who don’t otherwise have ties to the area. I think Michigan’s cities – particularly Detroit and Ann Arbor – are positioned to do better but the real crisis is the small blue collar towns. How can places like Muskegon, Saginaw, Bay City, etc. draw people? Those cities have quite low educational attainment and thus job opportunities and the “cool city” cache, so it’s hard enough to get boomerang residents let alone new people. When I lived in Milwaukee (my husband and I now live in NCY), I met a guy who had just moved there from Chicago. He had been offered CPA jobs in Muskegon and in Milwaukee, and he said it was no question that he (and his wife and infant son) would go to Milwaukee, and specifically cited the lakefront, nightlife, and the “energy” of the city.

    Now the question isn’t how to make a place like Saginaw compete with Chicago – it’s just out of the question. The question is how to make it an attractive place for natives who left and non-natives – because as we know, the more education a person has, the more mobile they are. Michigan communities have to make these people want to live there.

  3. Oops, there are some parts that were repeated. My post was getting lengthy and I cut/paste some parts without deleting others. Sorry if it’s hard to read or if I repeat myself!

    I love Michigan and it hurts to go back home and see my hometown barely surviving. On the other hand, I’m not willing to move back (for a variety of reasons but one of the reasons why my husband left is because his engineering job was shipped out of state) so I’m part of the problem.

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