A College Education Pays Off: New College Board Report

New York—As the price of attending college continues to rise and create anxiety among families, it’s no surprise that the value of going to college is questioned. But the facts are clear: going to college pays off for individuals and society. Individuals with higher education levels earn more and are more likely to be employed and enjoy benefits such as a retirement account and health insurance. Adults with more education are also more likely to move up the socioeconomic ladder and less likely to receive public assistance, according to Education Pays 2019, the latest report from the College Board Trends in Higher Education series.

"Although obtaining a college degree can mean forgone wages during a time when a student is also paying tuition, by age 33 the average bachelor's degree recipient will have recouped those costs," explains Jennifer Ma, senior policy research scientist at College Board and a coauthor of the report. "A higher education is an investment that pays significant dividends over the course of a lifetime—even for students who accumulate some debt to obtain a degree." In 2018, the median earnings of bachelor's degree recipients age 25 working full time were nearly $25,000 higher than those of high school graduates.

Updated triennially since 2004, Education Pays: The Benefits of Higher Education for Individuals and Society documents differences in the earnings and employment patterns of U.S. adults with different levels of education. The report also establishes a correlation between education and health outcomes, social mobility, and community involvement. In addition to reporting median earnings by education level, this year’s report also documents variation in earnings by different characteristics such as gender, race/ethnicity, occupation, college major, and institutional sector.

Although college enrollment rates continue to rise, the patterns are uneven across demographic groups. Gaps in college enrollment and completion rates can be partially explained by differences in academic preparation in K–12. Yet, even among students with similar academic achievement in high school, students from lower socioeconomic status (SES) families enroll and graduate at lower rates than those from higher SES families. Completion rates tell a similar story of improvement across all demographics, but underrepresented minorities have not seen gains as large as those of whites and Asian Americans. Male students, too, have not kept pace with the progress made by female students in enrollment and completion.

"Given the high payoffs of postsecondary education to both individuals and society as a whole, it is important that we increase college opportunity for all who can benefit and also improve completion rates," notes Jessica Howell, vice president of research at College Board. "Higher education is a powerful driver of social mobility for lower-income students, and it's critical that these students have every opportunity to attend and thrive in college."

The Trends in Higher Education series, which also include the Trends in Student Aid and Trends in College Pricing, provide a foundation for evaluating public policies to increase educational opportunities.

Key findings from the report:

Participation and Success in Higher Education

• Enrollment: In 1998, 59% of black and 55% of Hispanic recent high school graduates enrolled in college within one year of high school graduation, compared with 68% of white students. In 2018, enrollment rates were 60%, 66%, and 70% for black, Hispanic, and white students, respectively. The rise in Hispanic enrollment is particularly noteworthy, but it’s also important to understand why the enrollment rates of black and white students have not grown at the same rate. (Figure 1.1A)

• Completion: In 1998, the percentage of female adults age 25–29 who had completed at least a bachelor’s degree was 17%, 11%, and 34% for blacks, Hispanics, and whites, respectively. By 2018, these percentages had increased to 25%, 22%, and 47%. In 1998, the percentage of male adults age 25–29 who had completed at least a bachelor’s degree was 13%, 10%, and 31% for blacks, Hispanics, and whites, respectively. By 2018, these percentages had increased to 20%, 17%, and 39%. (Figure 1.6)

Earnings and Other Economic Benefits

• In 2018, the median earnings of bachelor's degree recipients age 25 and older with no advanced degree working full time were $24,900 higher than those of high school graduates. Bachelor’s degree recipients paid an estimated $7,100 more in taxes and took home $17,800 more in after-tax income than high school graduates. (Figure 2.1)

• The unemployment rate for individuals age 25 and older with at least a bachelor's degree has consistently been about half the unemployment rate for high school graduates. (Figure 2.12A)

• Among those who attended the most selective colleges, 68% of children from the lowest parent income quintile were in the top 2 income quintiles as adults, compared with 72% of children from the middle-income quintile and 76% from the highest-income quintile. (Figure 2.15A)

• In 2018, 4% of bachelor’s degree recipients age 25 and older lived in poverty, compared with 13% of high school graduates. (Figure 2.16A)

Variation in Earnings

• Full-time year-round workers age 35–44 with an advanced degree were more than 8 times as likely to earn $100,000 or more in 2018 than those with only a high school diploma. (Figure 2.3)

• Institutional median earnings vary by sector. From 2014 to 2015, the typical 4-year college's median earnings of 2003-04 and 2004-05 federal student aid recipients ranged from $34,600 at for-profit institutions to $42,800 at private nonprofit institutions and $42,950 at public institutions. (Figure 2.10A)

Health, Volunteerism, and Civic Engagement

• In 2018, 69% of 25- to 34-year-olds with at least a bachelor’s degree and 47% of high school graduates reported exercising vigorously at least once a week. (Figure 2.19A)

• Children of parents with higher levels of educational attainment are more likely than other children to engage in a variety of educational activities with their family members. (Figures 2.20B and 2.21A)

• Among adults age 25 and older, 19% of those with a high school diploma volunteered in 2017, compared with 42% of those with a bachelor's degree and 52% of those with an advanced degree. (Figure 2.22A)

• Voting rates are higher among individuals with higher levels of education. In the 2016 presidential election, 73% of 25- to 44-year-old U.S. citizens with at least a bachelor’s degree voted, compared with 41% of high school graduates in the same age group. (Figure 2.23A)

Same as the 2016 report, Education Pays 2019 includes labor market outcomes of students from specific majors and institutional sectors. To view the complete report, visit Education Pays 2019.

The Trends in Higher Education series includes the annual Trends in College Pricing and Trends in Student Aid as well as the triennial Education Pays.

For more information about our work, please visit collegeboard.org.