The recent great recession, which has spawned a spate of unemployment and underemployment among recent high school and college graduates, has raised questions about the value of a college education. Some people assert that a college education is not worth the money, and note that many famous dropouts are doing just fine.
In fact, this way of thinking is misleading.
New data reveals that a college education is more than worth the money. The data, from the Economic Policy Institute and analyzed by The New York Times, shows that the pay gap between college graduates and people without a degree has reached an all-time high.
In 2013, college graduates earned 98% more than people without a college degree, The Times reports.
That translates into a lot of money, enough to cover the cost of college in a single year. In 2012, the household earnings gap between people with and without a college degree was $30,298 to $58,249, the journal Science reports. Repeat, $30-58,000 more a year.
Multiplied over the course of an individual’s working years, the number is staggering. Calculates The Times: “The true cost of a college degree,” compared to not having a degree, is approximately minus “$500,000.” That means it has a value of approximately $500,000 more in earnings over the long run.
This can be hard to swallow, especially if you’re one of the millions of people earning less than your neighbors who have college degrees. Take heart – it’s never too late to go back to school, or to start saving to give your kids a better future.