Why education matters more than ever

Joe Cortright, Senior Research Advisor, CEOs for Cities
Joe Cortright, Senior Research Advisor, CEOs for Cities

Related Images

Given the sky-rocketing cost of a college education, the growing burden of student debt and the tough economic conditions over the past several years, some have questioned whether a college education is still worth the cost.
The economic evidence is overwhelming: The individual economic returns to education are as high as they have ever been. Whether measured through lifetime earnings or a lower risk of unemployment or an improved ability to cope with economic change, a college education is a strong predictor of economic success.
A recent analysis of Bureau of Labor Statistics data by researchers at Georgetown University shows just how critical a college degree is today. Tony Carnevale and his colleagues looked at the numbers of jobs held by persons with various levels of education and how their employment prospects changed during the recession that started in December 2007. They also counted who got jobs during the recovery that started in 2009.
All of the net job loss experienced during the recession – that's more than seven million jobs – occured among those with an Associates degree or less. Some college graduates lost jobs during the recession, of course, but overall, just as many people with a college degree gained a job during that time. In fact, those with four-year degrees actually saw an increase in employment during the recession. Of the 3.4 million jobs we've regained in the recovery, all of the net increase in employment has been recorded by those with an Associates degree or higher.
To some degree, the greater economic success of college graduates reflects how tough the competition is for jobs: With unemployment still near 8 percent, many employers have their pick of qualified applicants.
But increasingly, many of the new jobs in the economy require higher levels of skill and training. Even in manufacturing – traditionally associated with blue collar, low skill work – many jobs require the ability to operate and program computers, and employers insist on strong teamwork, problem solving and communication skills. In this environment, the only thing worse than the burden of student debt associated with a two-year or four-year degree may be trying to advance in this job market without a strong credential.
Of course there are still instances where education doesn't perfectly predict economic results – there are (and always will be) instances of baristas with recent-vintage Master's degrees and high school dropouts who are millionaires. But the tide is running strongly in the other direction.
These unfolding economic changes have implications for students, for cities and for the nation.
For individuals, while your mileage may vary, its generally the best advice to get as good an education as you can. The trends suggest that education is increasingly important to individual economic success.
For communities, the same pattern holds. About two-thirds of the variation in per capita income among U.S. metropolitan areas is explained statistically by variations in the college attainment rate of their populations. Smarter cities are more productive, more prosperous and have higher incomes.
Finally, as a nation, our long-term economic success hinges on doing a better job of improving access to education. Strikingly, after increasing the four-year college attainment rate from about 10% in 1960 to nearly 30 percent at the end of the 1990s, overall college attainment rates in the U.S. have essentially plateaued. Figuring out how to cope with the high cost of college, and finding ways to make education more widely available, will be essential if the nation is to be competitive in the global knowledge economy.

Joe Cortright is Senior Research Advisor to CEOs for Cities.

Graphic: The College Advantage: Weathering the Economic Storm, August, 2012.  Anthony Carnevale, Tamara Jaysundera, Ban Cheah. cew.georgetown.edu/collegeadvantage/
Signup for Email Alerts
Share this page
Signup for Email Alerts