Higher Education: A Remarkable Return on Investment
Does college pay off? Until quite recently, there’s been little disagreement about this. Higher education has long been seen as an important contributor to individual success and societal advancement. Over the past decade, though, doubts about the value of a college degree have been raised in response to rising tuition costs, high unemployment, and perhaps a certain anti-intellectual streak in American culture.
As strong believers in education, we think it’s important to look at the facts. This article presents findings from recent studies to show that college pays off for a broad cross-section of society, in a variety of ways.*
According to a study by the Bureau of Labor Statistics (BLS), the unemployment rate in 2012 for those without a college degree was 3.8% higher than for those with a bachelor’s degree or above.
Studies of our own graduates in the workplace** echo the BLS findings on employability. 4 out of 5 employers of a CTU graduate said they would hire another. And 99% of employers rate CTU graduates as “performing as well or better than” other employees.
The BLS study also points to higher average income for college graduates. Workers with a bachelor’s degree earn 63% more than those with a high school diploma alone.
Again, these are national projections covering all levels of experience; conditions in your area may be different. But surveys of CTU graduates confirm the effect: Our alumni report that within three years of attaining a bachelor’s degree, their incomes rose 25% on average. Within three years of attaining an MBA, our graduates averaged a 22% increase in income over what they had earned with a bachelor’s degree.
Beyond the numbers
Other studies amplify these quantitative differences. What about qualitative issues like job satisfaction, motivation, or even general happiness?
A 2013 Pew Research Center study found that 55% of college graduates reported being “very satisfied” with their jobs vs. 40% of non-graduates. For workers with a master’s degree or higher, that number climbs to 69%. The study also found that workers with high levels of job satisfaction were three times more likely to describe themselves as “happy.”
There’s more to being happy than just job satisfaction, of course. Guess what? According to a study by Richard Florida and Charlotta Melander, having a college degree appears to be the single most consistent factor in “well-being,” with a .68 correlation, to the Gallup-Healthways happiness index (markedly higher than the correlation of income to happiness).
More specifically, 69% of married college graduates describe their marriages as very happy, compared with 52% of high-school graduates, according to a study by economist Betsey Stevenson. There may be a variety of reasons for this, but one statistic from the study shows that nearly 15% fewer college graduates than high-school graduates list financial security as a primary reason to marry.
Although factors such as personality type, drive, and connections to community and business networks also contribute to entrepreneurial success, there’s an interesting connection between college education and entrepreneurship as well:
A survey by the Kauffman Foundation found that the majority of today’s entrepreneurs are college graduates. 92% of U.S. tech company founders hold bachelor’s degrees, and 47% have attained advanced degrees. Even more compelling: tech start-ups founded by college graduates perform better and grow faster than those founded by high-school graduates, which produce less than half the average revenue and employ fewer than half the number of people, on average, as all start-ups combined.
College: the healthy choice
Finally, there are fascinating correlations between higher education and human health:
The more college education you have, the healthier you tend to be. An 18% higher rate of employer-provided health insurance may contribute to this. But a college degree has been linked to several key factors in health: lower rates of obesity, smoking, and other health risks—and higher rates of regular exercise—are strongly correlated with higher learning. “Improvements in health are associated with each additional year of schooling,” according to a College Board “Education Pays” study.
Directly related to the point above is the less obvious fact that the children of college-educated people tend to be healthier as well. The same College Board study shows that childhood obesity rates are more than twice as high among children of high-school dropouts as they are among children of parents with a bachelor’s degree or higher. According to the Journal of Pediatrics, 70% of obese children from 5-17 have at least one risk factor for cardiovascular disease. Pre-diabetes and other conditions also correlate to childhood obesity.
And of course, healthier people tend to live longer. A University of Chicago study found that college graduates have a 28% lower incidence of early adult mortality than high-school graduates. Longevity figures vary over time, but according a 2012 research study published in Health Affairs, attaining a college degree can add years to your life.
Many factors affect health, longevity, and happiness, but the correlation with higher education is remarkable. Part of the effect may derive from the simple satisfaction of learning or achieving the goal of a degree. 4 out of 5 CTU graduates agreed that they were satisfied or very satisfied with their college experience—and half of CTU’s online graduates return to pursue additional degrees. The increased job security and income mentioned earlier may also contribute to general well-being. We keep finding more ways that college graduates reap the rewards of education for the rest of their lives.
*These are national projections, covering all levels of experience; conditions in your area may be different.
**Alumni Survey - 2012 CTU Alumni Career Progression Research: Survey of CTU alumni who graduated in designated years between 2002 and 2011.
Image Credit 1: Wikimedia Commons
Image Credit 2: CTU 2013 Graduation