With tuition costs rising every year, many students are asking the question: is a college degree really worth it? Two K-State professors of economics both agreed that yes, the financial sacrifices are all indeed “worth it.”
Daniel Kuester, director of undergraduate studies for the department of economics, said that those who earn a college degree will earn 70 percent more income over the course of a lifetime than those who only complete high school.
“Probably about 30 years ago, the wage premium of a college degree was estimated to be about 20 percent,” Kuester said. “Today, it’s closer to 70 percent, so on average a college graduate earns about 70 percent more than someone without a degree. Certainly we’ve become more of a specialized society focused on skills attained in college.”
Kuester defined a wage premium as the return on an education, or how much a college graduate earns relative to someone without a college degree. Although tuition costs seem steep, the value of a college education is indisputable, he said.
“The average unemployment rate for a college graduate is at 3.7 percent,” Kuester said. “That’s less than half of the overall unemployment rate in the United States right now. For those folks who don’t have a high school degree, their unemployment rate for 25 and older is 12 percent. So it’s more than three times as likely that someone who didn’t finish high school doesn’t get employed relative to someone who has a college degree. And it’s about twice as likely that someone who doesn’t finish college would be unable to find employment, relative to someone who has that bachelor’s degree.”
Kuester explained the increase in wage premium in relation to today’s job market and the shift in the economy. He said the decline in manufacturing or blue-collar jobs in the United States has caused increased demand for more highly-skilled employees, which explains why a growing number of Americans are completing college degrees.
“For a large number of jobs that might require more brawn than brain power, the wages just aren’t going to be as high as they once were,” he said. “Today, a skill set that we might consider to be more white-collar is going to be held in higher regard. I think the change in technology and machinery that could displace some of those workers has decreased the demand for labor.”
Philippe Belley, assistant professor of economics, said when weighing the value of a college education, it is important to consider the alternative to earning a college degree.
“There’s a lot of talk about the cost of college being inflated, too high … some people think it’s not worth completing a college degree anymore,” Belley said. “I completely disagree with that. One thing these people tend to forget is when you compare the wages of people with a college degree versus the wages of people who are high school graduates, it’s clear that getting a college degree is important.”
Joel Smith, junior in agronomy, said that at one point he did not believe the benefits of a college degree outweighed those of the alternative.
“I stopped going after the fall semester of my junior year because I was frustrated with some of the teachers and their teaching methods,” Smith said. “I got fed up and thought at the time that there were other things I could do instead of ‘wasting’ my time in class.”
Smith said he soon recognized that without a college education, he would not have as many opportunities in the job market.
“I decided to come back to school because I thought it was the right thing to do,” he said. “I did realize that to be successful I would have to have a degree, and it would increase my odds of having a successful career. If I wouldn’t have come back, I would have been stuck in the day-to-day grind of a job I didn’t enjoy.”
Belley noted that although tuition costs have increased throughout the country, K-State is committed to helping students find a career that reflects the value of a college degree.
“I think K-State puts a lot of emphasis, at least more than other universities, on trying to place their students into jobs,” Belley said. “I think that’s one way K-State can help. I guess the other way would be to decrease tuition fees, but right now it’s been difficult given the state of the financial situation in Kansas.”
Both Belley and Kuester agreed that the value of a college degree outweighs the financial burdens.
“College students are maybe taking on some debt while folks who don’t go to college would not be doing that,” Kuester said. “So it’s going to take some time to catch up. However, the data usually shows, over an average lifetime, someone in their mid-30s catches up to the earnings of someone who didn’t go to college and earns that 70-percent wage premium.”