Value of College Degree Is Clear, but Public Skepticism Persists

Earnings for people without a college degree have increased over the past decade. But because people with college degrees are also earning more, the historic wealth gap between the two groups hasn’t narrowed.

Despite that reality, the public perception that college isn’t worth the investment persists, according to a new report by the Pew Research Center entitled “Is College Worth It?”

Only 22 percent of those surveyed said the cost of getting a four-year college degree is worth it even if it requires taking out loans; 49 percent said getting the degree is worth it, but only if it doesn’t require getting loans.

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“The public has a pretty sober view right now of the pursuit of bachelor’s degrees, and how they’re financed is weighing on them,” said Richard Fry, an economist and lead author of the report. “But this data shows that finishing a bachelor’s degree has pretty big payoffs.”

Fry and his team analyzed federal data on the labor force, earnings, hours, household income, poverty characteristics and net worth to compare earnings trends of Americans with and without four-year degrees. They also surveyed 5,203 Americans last fall to gain more insight into how the reality of a college’s economic value squares with public perception.

The data (adjusted to reflect 2022 dollars) revealed that in households headed by young high school graduates, the median net worth rose from $12,700 in 2013 to $30,700 in 2022; In households headed by young college graduates, the median net worth rose from $46,600 in 2013 to $120,200 in 2022.

‘Economic Headwinds’ for Men Without Degrees

Divided by gender, the data shows that men and women without degrees have had different experiences in the labor market over the past 50 years.

Earnings for young men with a high school degree had been on the decline since 1973, though their earnings have seen modest growth over the past decade, according to the report. For young men with full-time, full-year jobs, median earnings increased from $39,300 in 2014 to $45,000 in 2023. But even with the uptick, when adjusted for inflation, their earnings are still lower than they were prior to 1973.

Wages for women with no college degree, however, haven’t fallen since the 1970s, and they remained relatively stable even during the economic downturn of 2001 and the Great Recession. And over the past 10 years, their wages have risen, from $30,900 in 2014 to $36,000 in 2023.

“The economic headwinds less-educated young adults have faced are particularly apparent in the areas where young men tend to be concentrated,” Fry said, noting that historically, less-educated men have gravitated toward fields such as manufacturing, whereas less-educated women are more likely to enter low-wage service jobs in the health and education sectors. “For example, with the decline of unions—which have been good for bringing up wages—it’s the young men who traditionally were the union members.”

But for men and women alike, the data is clear that completing a four-year degree substantially increases earning potential.

In contrast to men without a degree, wages for college-educated men have increased since the 1970s, according to the report. In 1973, young men with a four-year degree earned 23 percent more than their peers with a high school diploma. In 2014, men with four-year degrees earned 72 percent more, and as of 2023 that gap was around 71 percent.

Women with four-year degrees have seen similar gains.

Between 2014 and 2023, median earnings of college-educated young women climbed from $55,200 to $65,000. And the wealth gap between those women and their less-educated peers keeps getting bigger, according to the report. In the mid-1980s, the average young woman with a college degree earned about 48 percent more than a woman with just a high school diploma. By 2014, that gap had widened to 79 percent, a figure that’s remained relatively unchanged since.

Despite clear evidence that a four-year degree generally boosts economic stability, the report suggests that a sizable portion of the American public isn’t convinced.

Four out of 10 Americans who responded to Pew’s survey said it’s “not too” or “not at all important” to have a four-year college degree to get a well-paying job in today’s economy; 35 percent said it’s “somewhat important" and 25 percent said it’s “extremely” or “very important.”

The survey also asked respondents about the importance of having a college degree to land a well-paying job now compared to 20 years ago. While 49 percent of survey respondents said it’s less important now than it was in the early 2000s, 32 percent said it’s more important now and 17 percent said the importance remains unchanged.

Degrees Offer More Protection

Divided by age, 44 percent of people between the ages of 18 to 29 said a college degree is more important today than it was 20 years ago, whereas 29 percent of people between the ages of 30 to 49, and 30 percent of people 50 and older agreed with that statement.

Nicole Smith, chief economist at the Georgetown University Center on Education and the Workforce, said those perceptions may reflect young peoples’ understanding that technology has driven some job sectors, such as manufacturing and mechanics, to require more technical skills.

“Jobs have changed. With the advent of the personal computer you have to demonstrate your competency,” she said. “There are certain jobs that require credentials that you didn’t need before.”

And while 34 percent of Americans surveyed in the report believe it’s “extremely likely” a person without a college degree could get a well-paying job in today’s economy, Smith cautioned that the low unemployment rates workers are enjoying now likely won’t last forever.

“In general, people without college degrees are the first out during a recession,” she said. “It’s important to look at the value of a college degree in a recession, booms and slumps to really talk about what the true value is. It’s not only about if you can get a living wage, but whether you can get a sustainable, good job.”

Sean Tierney, director of research and policy at the Institute for Higher Education Policy, said that although public perceptions that college isn’t worth the price don’t align with the data, college administrators and education policymakers should take that view seriously nonetheless.

“We need better information for students around their investment, with clear information about what it’s going to cost and the expected earnings outcomes,” he said, noting that Congress passing the College Transparency Act, which proposes to track student outcome data across the country, could aid those efforts. “We also need to provide support to ensure that students can complete their degree and also make sure the programs we implement are done so to ensure equitable access.”