SUBMITTED NEWS RELEASE
The association of State Higher Education Executive Officers (SHEEO) has released a new State Policy Resource Center (SPRC) report, The Economic Benefit of Postsecondary Degrees: A State and National Analysis. The report shows that postsecondary degree attainment clearly results in higher earnings for the vast majority of individuals in all 50 states. Moreover, the evidence indicates that almost without exception, despite variation across states and disciplines, each successive level of higher educational attainment yields additional economic benefit. According to the analysis, those who obtain a bachelor’s degree have a median income of $50,360 compared to a median of $29,423 for people with only a high school diploma. An associate’s degree leads to a median income of $38,607, more than $9,000 higher than a high school diploma. Those with a graduate degree have a median income of $68,064, 35.2 percent more than those with a bachelor’s degree.
SHEEO President Paul Lingenfelter comments, “This study digs beneath the anecdotes to give an in-depth look at the financial returns to graduates by discipline and among the states. The more deeply and completely one examines the evidence, the more compelling the conclusion – higher education is a great investment for both the student and society as a whole, no matter where you live, no matter what you study.”
The report presents national and state wage premiums for seven discipline categories and examines median earnings variation across disciplines and across states. For example, the lowest wage premium for bachelor’s degree holders is in the trades discipline category where the median income of $40,305 is still 39.9 percent higher than those employed in this discipline holding only a high school diploma. The highest wage premium for bachelor’s degree holders is in the health-related disciplines where the 123.4 percent wage premium leads to a median income of $56,427. Across all disciplines, bachelor’s degree wage premiums range from 40 percent in South Dakota to 87.8 percent in Texas.
At the national level, higher earnings in a discipline tend to be correlated to increases in degree production. For example, between 2004-05 and 2009-10 health-related bachelor’s degree production increased 50.8 percent. Not surprisingly, this discipline has the highest wage premium over a high school diploma. Conversely, bachelor’s degree production in education declined 3.2 percent over the same time period. The median income in education is 20 percent lower than the median income across all disciplines.
The relationship between economic payoff and increased degree production, however, is not universal. Degree production in the STEM disciplines has not increased more rapidly than total degree production over the last five years, despite the fact that median incomes for the STEM disciplines are above average for each degree level analyzed in this report. Considering the emphasis policymakers have given to increasing STEM degrees, further efforts to improve the effectiveness of the programs created to promote STEM education seem warranted.
Over the past four years, with support from the Lumina Foundation, SHEEO has developed the State Policy Resource Center (SPRC) to provide rapid, easy access to data and analytical studies to help state leaders identify priorities and develop strategies for improving policies and performance.
The project has assembled a data warehouse that includes IPEDS data and other data sources for the past ten years, and it has produced a series of analytical reports.
See http://www.sheeo.org/projects/state-policy-resource-center-sprc for more information and to review earlier studies.