Although postsecondary education remains the ticket to the middle class, the rules for assessing college’s economic payoff to students and their families are more complicated today, according to Anthony Carnevale, director and research professor of the Georgetown University Center on Education and the Workforce
“The notion that simply going on to school longer and longer gets you somewhere is still somewhat true on the average, but the average is disintegrating because what matters more now is what you take,” Carnevale said. He cited as an example the difference between a petroleum engineer with a bachelor’s degree making $120,000 a year and a psychology graduate who can expect to make around $35,000, about the average for a high school graduate.
Carnevale said that economic trends will continue to favor growing differences in the earnings returns by field of study, while also favoring postsecondary education. His organization projects that of the 55 million expected job openings in the United States during the next decade, 60 percent will require some college.
“We’re talking about job openings across the board with much higher wage premiums for people with postsecondary education than for people with a high school education,” he said, “and truthfully, a gradual disappearance of anything like a high school-related career job.”
Carnevale reported the age at which young people reap the returns from their investment in education is growing later. He noted the age by which most young people achieve the median American wage has jumped from 25 to beyond 30 years of age. “That stretch from 18 to 33 and 34, when you finally get a preponderance of the population that makes it, that stretch is a tough stretch for a lot of people,” he said.
The noted labor economist also expressed concern about the growing stratification by race and class in the higher education system. While African-Americans, Hispanics and low-income students have made significant gains in enrolling in postsecondary institutions, Carnevale pointed to significant disparities in the types of institutions they attend, compared with their more well-to-do counterparts.
Carnevale reported that 80 percent of new white students have been enrolling in the “top 468 colleges” with selective admissions, while 70 percent of new African-American and Hispanic students enroll in open admissions or for-profit institutions. The differences, he said, are that open admissions institutions spend one-third to one-fifth as much per student as the top 468 colleges, and graduation rates are twice as high at the selective institutions for equally qualified students.
Efficiency vs. equity
Carnevale warned that the push toward enhancing efficiency in the delivery of higher education — necessary as it is — could exacerbate this stratification by race and income. To meet demands for lower costs, higher rates of on-time graduation, and improved job placement, college leaders could simply become more selective and admit the students more likely to succeed.
“I think what’s next is that we’re going to have a big, powerful movement toward efficiency,” he said. “The question is: Will there be some sort of equity policy that will try to discipline that so it doesn’t create even more stratification in the higher education system?”
Carnevale agreed that the higher education system is too expensive. “We’re spending about $440 billion a year now on postsecondary [education],” he reported. “It will cost at least $200-$300 billion a year to meet the [President] Obama goal [that by 2020, America would once again have the highest proportion of college graduates in the world]. That’s just not going to happen.”
He told the gathering that he is fairly optimistic of a favorable outcome both for higher education and the economy.
“The notion that higher education is not adapting is not true,” he said. “The higher education system really has become our workforce development system. The real issue is: Is it efficient enough as such, and how does it then do the other things it’s supposed to do, and how do we ensure that it gives good general education, as well as career education, on an equal basis?”