Brawner: How Much Is Some College Worth?

Stephens Media columnist and Talk Business contributor Steve Brawner explores a new report that examines the correlation between education and future wages.

Dr. Neal Gibson and Dr. Greg Holland with the Arkansas Research Center have compiled a lot of data to test a theory, which concludes:

Their recent report, “Education and Wage Outcomes for the Arkansas Workforce,” looked at Arkansans whose formal education ended in 2006. Using the state’s unemployment insurance records, they studied the incomes of 69,515 people – the incomes, not the names.

Here’s what they found. Those with a high school diploma earned an average of $14,972 five years after graduating, which was $3,700 more than those who dropped out in the 12th grade. Those with a credential “less than” a bachelor’s – for example, an associate’s degree – earned $27,631. Those with a bachelor’s degree earned $38,887. Those with more education earned $52,447.

The report is most interesting where it looks at the salaries of students who had “some college.” For each additional year of school, wages increased significantly even though students didn’t take home a diploma. Those who dropped out as freshmen earned $21,057 – a significant jump over the $14,972 their fellow high school graduates were making. Students who dropped out their senior years were making $31,531. If they had gotten their degree, statistically, their annual salary would have jumped more than $7,000.

Gibson and Holland agree that people can do well with only a high school diploma. But, averaged across 70,000 Arkansans, more education means more money.

But is this obvious conclusion that simple?

Read Brawner’s additional exploration of the issue at this link.