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What Is the Value of a College Education?
A college education is a significant investment, so
it makes sense to consider carefully whether it is
Percentage of 25-64 year olds with a college degree (2012)
worth the time and money. In good economic times
Australia
and bad, and in spite of its rising cost, the answer is
Brazil
"yes." According to the Organisation for Economic
Chile
Cooperation and Development (OECD), around the
Czech Republic
France
At or below the
world the number of people getting a college education
Greece
median income
is rising steadily (see Figure 1).
Japan
More than 2x the
Korea
median income
Percentage of population (25-64) with a college education
Portugal
Turkey
60
2000 2012
United Kingdom
50
0
10 20
30
40 50
60
70
80
40
Figure 2
Source: OECD Indicators
Income variance between degrees
4. It is evident that a college degree provides an economic
advantage, but not all degrees have the same earning
Canada
Germany
Japan
Mexico
OECD average
Poland
South Korea
Spain
Turkey
United Kingdom
United States
power. Most analyses suggest that degrees in STEM
fields (science, technology, engineering, and math) have
the greatest potential impact on future income. In the
United States, a college graduate with, for example, a
Figure
Source: OECD Indicators
chemical engineering degree can expect to earn about
$70,000 annually, whereas a graduate with a literature or
The impact of a college education
art degree may be lucky to get $36,000 for an entry-level
position. Marc Andreessen, the founder of the Internet
A college education has a broad and positive impact.
company Netscape, once declared that someone who
People with a college degree are by far the most likely to
studies a non-technical field like literature will probably
enter and remain in the labor force. In OECD countries,
end up "working in a shoe store."
average participation in the labor force for those who
never completed high school is about 55%. For those
5Yet, technical knowledge alone may not be sufficient
with a high school degree, the figure is about 70%,
for success. Steve Jobs, one of the founders of Apple,
and for college graduates, it is about 83%. College
famously claimed, "It's technology married with liberal
graduates also earn more than those with only a high
arts ... that yields the results that make our hearts sing."
school degree. In the United States, a new high school
Other major employers in the technology field agree.
graduate earned on average $28,000 per year in 2013,
Industry leaders say employees from the liberal arts are
whereas those with a college degree made about
good at managing ambiguity, unlike engineers, who
$45,000. Over a lifetime, that difference adds up to
tend to see situations in black and white. Liberal arts
about a million dollars. Figure 2 provides a dramatic
graduates can see a problem from multiple perspectives.
illustration of the impact of a college degree on income
6 It is interesting to note that the income gap between
in selected OECD countries .
liberal arts and STEM graduates gradually diminishes
The consequences of getting- or not getting- a college
as they continue in their careers. In fact, liberal arts
education extend beyond income. There is a strong
degrees are quite common among the world's most
association between education and health. Chronic
highly paid workers. About one-third of the directors of
diseases, such as heart disease and diabetes, pose the
Fortune 500 companies' have a liberal arts background.
greatest risks to pu
Students, parents, politicians, and industry leaders may
sks to public health i
today These diseases
ealth in developed countries
eases are caused , at least partly, by
argue over which are the most valuable degrees, but the
lifestyle choices, such as poor diet or smoking. In
value of a college degree in general cannot be disputed
general, people with higher levels of education make
healthier lifestyle choices and have greater access to
'Fortune 500 companies (n) the businesses ranked by Fortune magazin
high quality healthcare.
as the 500 most profitable companies in the U.S. for a particular year

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