College Degree No Longer Enough

By Alan Stewart Carl | Related entries in Economy, Education

Here’s an interesting piece of data courtesy The Wall Street Journal:

In the economic expansion that began in 2001 and now appears to be ending, the inflation-adjusted wages of the majority of U.S. workers didn’t grow, even among those who went to college. The government’s statistical snapshots show the typical weekly salary of a worker with a bachelor’s degree, adjusted for inflation, didn’t rise last year from 2006 and was 1.7% below the 2001 level.

The Journal notes that workers with a college degree still make 75% more than those with just a high school diploma, but the wage stagnation is affecting all those with college degrees, from new graduates to those nearing retirement.

Why? Globalization, technological improvements and more educated immigrants have all played a role in making college degrees less valuable. But economists point to this:

The issue isn’t a lack of economic growth, which was solid for most of the 2000s. Rather, it’s that the fruits of growth are flowing largely to a relatively small group of people who have a particular set of skills and assets that lots of other people don’t…In short, a college degree is often necessary, but not sufficient, to get a paycheck that beats inflation.

What’s this mean for those of us who’d like to be better off in four years than we are now? Get specialized. Find what we can offer that few others can. Except that can be rather difficult. We’re not all highly intelligent or extremely creative or fortunate enough to have a prestigious degree that opens more doors. We’re talking about putting a lot more work into working.

The bad news is: we are likely entering an economy that doesn’t support the kind of “live better than my parents did” expectation that we all thought was our birthright during the last half of the 20th Century. The good news is: effort still pays in America. Make yourself valuable and you will be well compensated. Only it’s not so simple as just getting a degree. We’re more on our own now. The trick will be making the transition.


This entry was posted on Thursday, July 17th, 2008 and is filed under Economy, Education. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

2 Responses to “College Degree No Longer Enough”

  1. Jim S Says:

    The good news is: effort still pays in America. Make yourself valuable and you will be well compensated.

    This is a cliche. It is not always true or even true a majority of the time any longer. The argument would be much stronger if it wasn’t for the incredible discrepancies between highly educated Americans working for Wall Street Banks, the financial giants in general and truly gifted engineers, scientists and educators. The reason that the majority of Americans have caught on and do not believe that their futures or those of their children are full of hope and sunshine is that even with all the hard work in the world their salaries for the majority have stayed flat after inflation for years. To claim otherwise is to tell them that they’ve been being lazy and not working hard this entire time salaries haven’t kept pace with inflation. Every Republican who spouts this line is insulting the working American they’re talking to. Then they wonder why the numbers of working Americans identifying as Republicans is declining.

  2. Alan Stewart Carl Says:

    Jim, I like to leave a little room for optimism.

    What I wrote is not at all insulting to the hard working people who are struggling to get ahead. There is nothing wrong with saying hard work CAN lead to riches (and where did I say it was always true? Did not the entire rest of the post address how hard it has become to get ahead? You really cherry picked that quote, man).

    I think your argument is dismissive of the many, many people who’ve worked their asses off to get where they are today. They aren’t all trust-fund babies and we shouldn’t assume they are lucky to be where they are. The moment we stop believing hard work is the route to success is the moment we fail as a nation.

    I think we can address the problems faced by the many Americans who are sturggling without resorting to bashing the notion that hard work can and should pay off. The goal should be to make hard work worthwhile for everyone.

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