Higher Education Can Pay Off for a Lifetime
May 14, 2002 -- When Susan Lindner wanted to study anthropology at a small liberal arts college, her father's response was: "Anthropology?! That's a road-map to the poor house."
Considering high tuition costs, it's no wonder that Lindner's dad was worried.
A look at the cost side of the equation bears him out. The average tuition for a four-year private university stood at $17,123 for the 2000-2001 academic year, according to the College Board, up from $10,330 for the 1995-1996 academic year. The average student borrows slightly more than $12,000 to finance higher education.
Initial costs aside, however, the payoff seems clear. As of 2000, the median annual earnings of workers with professional degrees were more than 3.5 times those of high school dropouts, finds the latest occupational outlook from the federal Bureau of Labor Statistics.
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In fact, an upcoming report on the relative earnings of full-time year-round workers by education level, from the Washington, D.C.-based Employment Policy Foundation, further shows that the more you learn the more you earn.
Although simply completing high school improves earnings outlook, the average high school graduate will earn an estimated average annual income of $30,109 and $1.2 million in a lifetime.
The average college graduate stands to net nearly twice as much, with a $51,097 average annual income adding up over 40 years of earning potential to more than $2.04 million.
Putting Studies to the Test
Lindner herself became a good example of how an education can help the bottom line.
She ended up making a decent salary — $42,000 — working as a field anthropologist in Thailand trying to help women find alternatives to prostitution. And, her compensation rose when she became an AIDS researcher with the Centers for Disease Control and Prevention in Atlanta.
She has since managed to parlay her field experience into a successful career at a New York City public relations firm where she earns approximately triple her starting salary.
"All the skills I learned out there — including trying to persuade married men to use condoms when they are with prostitutes — have helped a lot," she says. "When it really comes down to it, learning how to speak in another person's language is what P.R. people do with their clients."
Added-Value Learning
At a minimum, experts say a bachelor's degree makes sense whether prospective students covet the corner office or just a comfortable life.
"Today a college degree is as essential to a successful career as a high school diploma was years ago," says Jeff Heath, president of New York City-based Landstone Group/MRI, an executive search firm.
Ranking among the most popular, and most profitable undergraduate majors, says Robert Franek, editorial director of test prep firm The Princeton Review in New York, would be any business, technology and health-related course of study — management, accounting, computer science, nursing and biology.
The more liberal arts-based majors, like English, communications and education, are also in high demand, but tend to be harder to quantify, he adds.
Add an MBA, JD or MD into the mix, and an individual's marketability rises.
An MBA, for instance, can help the right person become even more successful by teaching a complete business vocabulary, offering access to new career opportunities, developing leadership skills and greatly enhancing professional networks, explains Jon McBride, co-founder of the Jungle Media Group, a career and lifestyle magazine company in New York.
Adds Heath, "Think of education as an insurance policy. Unless you open your own business and it takes off, you're going to be working for a company. And education works in the workplace."
Take This Job and Keep It
A higher level of education not only tends to make finding a job easier, it helps retain a job, especially in trying economic times, according to Ronald Bird, EPF's chief economist.
Someone who finishes a degree is more likely to have job security and find jobs more easily, he adds.
In fact, EPF data shows that the demand for highly skilled personnel has grown by half a million people in 2001, despite the mild recession. And, the unemployment rate for all degree holders has stayed under 3 percent, far lower than the 5.9 percent national average.
The findings don't surprise experts. "If there are no jobs in banking, for instance, an MBA will also help you get a job in government, non-profit work, etc.," explains McBride.
Moreover, McBride says that when his magazine surveyed MBA alums in the marketplace, they reported that in good times and bad, their professional and personal networks — often built while getting degrees — are key to finding jobs.
As important is the ability for students to get a taste of their career options through internships.
"An internship is a great way to figure out whether you'll be able to make a career out of your course of study," says Franek. "Think of how much time and money you can save by finding out either that you love your area of study, you should find a different interest or that you should go to graduate school to hone in your talents," he adds.
In the final analysis, says Bird, it is often simply that a graduate has gone the full route of completing a degree that is most attractive to employers.
Adds Heath, "Beside learning a new skill set, graduates prove that they know how to pursue a course of action and deliver on it. There's real credibility in that."