Advantages And Differences: What Is A Graduate Earnings Premium?

789 Words2 Pages
bulb-icon

Recommended: Why is quality education important

What is a graduate earnings premium?
What is a graduate earnings premium?
The graduate earnings premium describes how much more a graduate can expect to earn in a career than someone without a degree. There has always been a big difference between the earnings of university graduates and their nongraduate counterparts. The exact figures change each year, and the earnings premium can even decrease occasionally. However, the overwhelming trend is that students can expect to earn more over their careers with a degree. The premium isn 't limited to earnings, but earnings are critical considerations when many students consider the higher costs of financing their educations. These benefits also include better choices of employers, shortened times for seeking new jobs and greater career mobility. Students who worry about incurring large amounts of college-associated debt can rest easier knowing that their earnings premium will usually cover the debt payments with more left over to fund a better, more fulfilling lifestyle.

Statistics that support university educations
A wealth of statistics and anecdotal evidence shows that, despite occasional upswings and retrenchments, the graduate earnings premium is real, substantial …show more content…

Employers are exercising greater discrimination in how they choose and pay graduates based on their academic performances. A respected study examined the relationship in earning a salary premium and achieving high marks at university. The study, 'Graduate Returns, Degree Class Premia and Higher Education Expansion in the UK, ' found that graduates who earned 2:1 or higher earned 7 percent to 9 percent more than students with inferior degrees five years after graduating.[3] The study found that this gap is increasing but that few reputable studies have been made to assess this important employment and earnings trend. Further findings

Show More
Related

  • The College Payoff Illusion Summary

    408 Words  | 1 Pages

    Thousands of people end up enrolling in college after they graduate from high school. Most of them want to further their education so they can make something out of themselves. It is a common idea among many, that college will end up increasing one’s average income. In the article, The College Payoff Illusion, by Edwin S. Rubenstein, he wrote that “In 1997, college graduates earned an average of $40,508 versus just $23,970 for non-college graduates”. The statistic shows that graduates are making more but does it have more to do with their college degree or their personality?

    Read More

  • Summary: The Imperiled Promise Of College By Frank Bruni

    690 Words  | 2 Pages

    The real problem, according to Bruni, is that a college education is now far less likely to result in gainful employment. While statistics suggest that the rate of unemployment for college graduates is far better than for those with only a high school education, Bruni argues that these statistics

    Read More

  • Summary: Is College Worth It?

    696 Words  | 2 Pages

    Unemployment is on the rise and, always trying to be avoided. By obtaining a degree, the chance of being out of work is reduced. Baum, Ma, & Payea (2013) claim, “The 2012 unemployment rates for 25- to 34-year-olds were 9.6% for those with some college but no degree and 7.2% for those with associate degrees” (p.20). With just an associate's degree, the chance of being unemployed plummets 2.4% compared to those compared to little college, proving when the higher of a degree is obtained, the lower

    Read More

  • The High Cost Of College Education

    1027 Words  | 3 Pages

    While college may be initially uneconomical, evidence from a 1959 census shows a “three-fourths of earning difference” between those who graduated from college and those who merely received a high school diploma (Weisbrod et al 495). Weisbrod and Karpoff acknowledge the high cost of college in America, but assert the benefits of a college degree will more than reimburse a person in the long run, therefore the initial cost of attending a college is worthwhile. (Weisbrod et. al). Furthermore, this indicates only “one-fourth of the earnings differences are attributed...to non-schooling factors”, which proves the significant role college plays in determining the future earnings of an individual (Weisbrod et. al 497). College appears to be the most influential factor in regards to a person's earnings, therefore according to Weisbrod and Karpoff, college is necessary for a person who wishes to obtain a higher expected income. Even students who attend mediocre to below-average colleges will receive “a lifetime income that is [around] 10 percent lower ...than that which someone at one of the best schools can expect” (Weisbrod et. al 497). Weisbrod and Karpoff contend even low-tier colleges result in higher earnings, therefore a student should strive to attend any college regardless of the

    Read More

  • What Is The Three Reasons College Still Matter?

    1024 Words  | 3 Pages

    In addition, the writer of “The Benefits of a College Degree” wrote that”One of the most important and obvious reasons to earn a college degree is to increase your earning potential”(“The Benefits”). While it is true that college is indubitably expensive, the years of learning a particular trade or skill for the future of career of these students is important and worth the cost. Also, students can apply for a variety of scholarships for different amounts of money to help pay for college and lower the amount of debt caused by schooling. Furthermore, multiple students believe that a college education is not needed for their future and that they can get good paying jobs without it. This philosophy does not apply to any good paying careers with the exception of the military and some construction jobs. The good paying jobs require at least a bachelor’s degree in many cases, except for a few that require an

    Read More

  • Analysis Of Is College Worth Going To College

    1446 Words  | 3 Pages

    If the student graduates with a degree that is high need this can help the graduate get the job much easier and if the job pays well, this can help pay off the graduate’s student loans sooner as well. Whenever you have a higher income this can increase your monthly loan payment, which leads to being able to pay off your student loans much faster than having a job that has a lower pay rate. “The value of a college degree remains high, and the average college graduate can recover the costs of attending in less than 20 years.” (Mary C. Daly, Leila Bengali, page 4). From the article “Is it still worth going to college” Mary C. Daly and Leila Bengali explain how if you graduate from a four year college a graduate will have a much higher earning rate rather than a high school grade and also a graduate that attended some college but, less than four years of attendance. “College graduates earned an average about $20,050 (61%) more per year than high school graduates.” (Mary C. Daly, Leila Bengali, page 1). Not only does having a well-paying career help pay off student loans quicker, but it can also help the

    Read More

  • Analysis Of Stephanie Owen And Sawhill's Article: Should Everyone Go To College

    822 Words  | 2 Pages

    In their article, Owen and Sawhill appeal to ethos by comparing statistics on college graduates’ income to the income of those who did not attend college. One figure Owen and Sawhill present is “research shows that 23- to 25-year-olds with bachelor’s degrees make $12,000 more than high school graduates but by age 50, the gap has grown to $46,500”(641) They

    Read More

  • College Is Worth It Or Not?

    1523 Words  | 4 Pages

    Although a college education grows more and more expensive every year. People begin to question whether college is a good idea to invest in or not. “As college costs continue to rise, students and their families are looking more carefully at what they are getting for their money. Increasingly, they are finding that the college experience falls short of their expectations”(Cooper. H Mary). Many people believe that the cost of a college degree has outstripped the value of a degree.Studies show that a college degree will increase your earning power. A lot of people say that a college degree now is worth what a high school diploma was wor...

    Read More

  • Blanche D. Blank's A Question Of Degree

    1027 Words  | 3 Pages

    College is the place where people go to retain the necessary training for a job that requires specific skills, which results in earning a higher pay check. In today’s world, employers are scouting out for individuals with the proper dexterities to fill the shoes for that specific job. Blanche D. Blank, the author of “A Question of Degree," argues that possessing a degree of higher education isn’t the only way to have a very successful life. This statement is highly argumentative, due to the fact that college graduates still out-earn people without degrees. Obtaining a college degree is one of the best things someone can do for themselves, when it comes to looking for a stable job. There is also so much more to college than just receiving a

    Read More

  • My Higher Education

    892 Words  | 2 Pages

    Berggren, Caroline. "The Influence of Higher Education Institutions on Labor Market Outcomes." European Education 42.1 (2010): 61-75. Academic Search Complete. EBSCO. Web. 9 Mar. 2011.

    Read More

  • Gender Wage Gap Essay

    1711 Words  | 4 Pages

    Education and experience are considered “human capital” by economist. The knowledge and skills learned on the job make employees more productive. Historically women were less likely to go to college and graduate, however according to the U.S. Department of Education Institute of Education Sciences National Center for Education Statistics Between 1970 and 2001, women went from being the minority to the majority of the U.S. undergraduate population, increasing their representation from 42 percent to 56 percent of undergraduates. If these trends continue women will make up the larger segment of the skilled labor force. Educational attainment is particularly important in closing the wage gap. The simple fact is that employees with a college degree makes more than employees with a high school education. The gender wage gap exists at all levels of education, and women with graduate degrees experience the widest wage ratio of 73 percent, earning almost $450 less per week than

    Read More

  • Is a College Degree Really Worth It?

    1386 Words  | 3 Pages

    Once college graduates enter the workforce, there are usually two sides to the whole income situation, it’s either: “you’re making the same amount of money as a person without a degree,” or, “you’re not going to get a job in your field of study because unemployment is too high.” Luckily, those are just common misconceptions--- yes, you’re probably making the same amount of money as a person without a degree but it definitely will not be for long, and no, just because there is an unemployment rate won’t mean you’re not going to get a job in your field of study. In fact, according to the Eco...

    Read More

  • College Education is the Best Investment

    1413 Words  | 3 Pages

    By attending college, students guarantees themselves a better job that the average Joe. Because the world is changing rapidly, and many jobs rely on new technology, more jobs require education beyond high school. With a college education, an individual will have more jobs from which to choose. In addition to obtaining a better job, people who go to college usually earn more money than those who do not. College furnishes you with proper credentials and documents to land high-level jobs. Figures from an A&E television program on ‘The Working Class’ show that in 2004 the average earnings were $23,895 for a high school graduate and $41,478 for individuals with a bachelor’s degree. Getting a college education is simply a stepping stone in ensuring yourself with a good start in life. Some may agree that college students are open minded and knows exactly how to expre...

    Read More

  • Why College Is Important To College Essay

    1552 Words  | 4 Pages

    Most people can find a job in their field, but the amount of people who can not find a job in their field is increasing. “Unequal outcomes from college have always been a fact of life, but there is evidence that the dispersion of outcomes has increased” (Haltom). If a person ha a lower income job, it is not always because they did not have a college education. “1 percent of taxi drivers and roughly 3 percent of bank tellers had a college degree” (Haltom). This shows that even though some people have a college education, they could not find jobs in their field and had to take jobs that they less likely wanted. Haltom also says, “as many as 120,000 of the nations 1.7 million 2012 graduates who wanted to work elsewhere took jobs as waiters, salespeople, cashiers, and the like” (Haltom). More and more people with a college education can not find jobs in their field.

    Read More

  • Unemployment and Underemployment in America

    1297 Words  | 3 Pages

    Kahn, Lisa B. 2010. “The Long-Term Labor Market Consequences of Graduating from College in a Bad Economy.”

    Read More

More about Advantages And Differences: What Is A Graduate Earnings Premium?

Open Document