A common bromide about today’s economy is that it rewards those with educational credentials, while pummeling folks without degrees. Cue the usual tropes of the once high-paying factory jobs that have disappeared or been replaced by jobs with diminished opportunities.
Now look at the chart below, from the U.S. Census Bureau. It shows the relationship, over close to four decades, between the pay of workers with advanced education to those with only a high school diploma. As you can see, it really hasn’t changed much since the early 1990s.
Overall, those with a bachelor’s degree or higher make about twice as much as workers with a high school degree (1.94x in 2012, if you want to be precise). That’s stayed constant for a long time. Make no mistake: that’s still a very big premium for education. College and credentials are the entry into the middle class.
What degrees don’t protect you against is the long-term trend of stagnant or falling wages. In inflation-adjusted terms (something you don’t see in the chart here), wages for every educational tier have fallen. In 2001, full-time workers with at least a bachelor’s degree earned an average of $77,217.* In 2012, that was down to $72,661. High school graduates fared similarly; those with master’s degrees actually did a bit worse.
A lot of folks have wondered when professional jobs will be subject to the same competitive pressures–outsourcing, shareholder demands–that have strangled wages at the low end. Well, you can stop wondering: The numbers show they already are.
*The Census Bureau’s tables are divided by sex. I did a bit of math to combine the data for men and women.