College often means years of student debt and job prospects that aren’t always ideal, but a degree is still very much worth the investment.
In fact, not going to college will cost you about $500,000 over a lifetime, according to a new paper from Massachusetts Institute of Technology (MIT) economist David Autor.
Autor calculated the amount by subtracting tuition and fees from the earning gap between college and high school graduates. He found that not only is skipping college costly, the cost of not attending school is going up, too. It’s now about twice what it was 30 years ago, Autor calculated.
Naysayers will point to ballooning student debt and skyrocketing tuition as signs that paying for a degree can weigh students down. And many college graduates struggle to find employment in their desired field, which could make them question the value of an education.
But there’s an underlying truth that can’t be ignored: after adjusting for inflation and other factors, Autor found, people with a college degree still earn more.
The MIT paper notes that the earnings gap between men with and without a degree in 1979 was about $17,400 in 2012 dollars. The gap had risen to nearly $35,000 by 2012. The gap for women has almost doubled, as well, but the dollar amount remains somewhat lower because women continue to earn less, on average, than men.
And while college graduates earn more than they have in previous years, pay for people who have some college but no degree has flatlined, and pay for high school graduates has actually dropped.
The new paper jibes with previous research from the Pew Research Center and various think tanks that find college is worth the investment. A recent report figures that will be the case until at least 2086.
The idea that there are too many degree holders right now is also not true.
As The New York Times recently noted, the fact that the pay gap between college graduates and everyone else reached a record high last year implies that the economy does still need more college graduates.
“There is nothing inevitable about this trend,” David Leonhardt wrote for the Times. “If there were more college graduates than the economy needed, the pay gap would shrink. The gap’s recent growth is especially notable because it has come after a rise in the number of college graduates, partly because many people went back to school during the Great Recession. That the pay gap has nonetheless continued growing means that we’re still not producing enough of them.”
Public policy can have a real impact on inequality, Autor points out, citing the declining power of unions and the declining real value of the minimum wage, among other things. And policies that reduce inequality - good schools, good nutrition and quality public health systems among them - help raise the overall skill level of the workforce.
So one bit of good news is that public policies might help. A number of lawmakers have begun to focus on ways to reduce the burgeoning student debt burden and make sure the degrees schools award are actually worth something.
Ultimately, Autor said, according to an MIT News release, even with tuition rising, college is worth the money.
“The relative wage differential between college and high school graduates is higher than it’s ever been,” he said. “Now, college has gotten more expensive, but relative to the lifetime earnings differential, it’s still quite an attractive investment proposition.”
Emily DeRuy is a Washington, D.C.-based associate editor, covering education, reproductive rights, and inequality. A San Francisco native, she enjoys Giants baseball and misses Philz terribly.