Value of a college degree

Value of a college degree

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In high school the safest and most sensible decision concerning the future is to apply and attend a 4-year university immediately after graduating. However, many people are becoming skeptical of this tradition.

A way some people look at it is that education adds what is called “human capital” to a person, increasing his economic value. People with more knowledge, or “capital,” usually tend to find jobs easier and receive larger salaries. For example, a 4-year bachelor’s degree from Georgia Southern increases one’s human capital, as opposed to only having a high school diploma. A study conducted by the Federal Reserve Bank of New York showed that, on average, a bachelor’s degree increased an employee’s annual earnings by $15,000 dollars opposed to a high school diploma. In 2005 this gap widened, and bachelor’s degrees began earning more than $70,000 dollars per year while high school diplomas actually earned less than what they had in 1970 (figures are adjusted for inflation, according to “College Calculus: What’s the real value of a higher education” by John Cassidy). So, according to these studies, it’s obvious that human capital gained from college is almost a guarantee for higher wages. However, the gap in wages has stopped rising, and the value of a bachelor’s degree is seemingly falling.

A study conducted by the Employment Policy Institute shows that from 2001 to 2014, wages of those with bachelor’s degrees have declined from $30.05/hour to $29.55/hour, and college graduates are struggling to find jobs and remain unemployed. This has led people to question the value of a 4-year bachelor’s degree. Around the ‘60s, about one in 10 people from the ages 25-34 had a degree. Today, half of Americans in that age group have college degrees. The increasing amount of degrees is lessening the importance of one, and college graduates are struggling for blue-collar jobs. The decision of paying enormous amounts of money to increase one’s human capital is becoming slightly less rational, seeing as degrees are hardly digging people out of their student loans and less so paying for itself.

College is still, just as it always has been, a good decision. One will almost undoubtedly make much more money with a bachelor’s degree than you  would by sticking with just a high school diploma. Although, with the information above, you should be slightly encouraged to explore more options, such as technical institutes like Ogeechee Technical College here in Bulloch County.

 

 

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