The Importance of a College Degree | November 2023
Education has become a marker of distinction in the United States. College grads typically earn more money than those without a degree, but research shows the social divide goes much deeper. While unemployment is at a nearly 50-year low and gross domestic product is on the rise, economic statistics show a divide between degree earners and non-degree earners in terms of quality of life.
Poor life ratings are at a record high
Poor life ratings are at a record high, according to Gallup’s Life Evaluation Index. The percentage of Americans who rate their lives as “poor” is the highest since the index was introduced in 2008 amid the Great Recession. The same study shows the percentage of Americans who are considered to be thriving has been steadily declining since 2021 while the suffering rate has doubled.
These trends can be attributed to many factors including increased daily stress, increased worry, economic conditions, economic confidence, and contentment with U.S. moral values. Some experts highlight that Americans with four-year degrees, however, are typically better off by these measures and even have longer life spans.
A gap in life expectancy
Interestingly, life expectancy in the United States has fallen behind other wealthy nations. This decline is worse for those without college degrees because they tend to have fewer job opportunities, less political power, and lower social esteem. Based on public health data, adults with four-year college degrees have a life expectancy of 83 while adults without college degrees have a life expectancy of 75. The divide was even worse during the pandemic.
The spread of wealth
According to the Federal Reserve, wealth used to be split equally between degree earners and non-degree earners in the 1990s, but now the split is 75-25 in favor of college graduates. Comparing wages between 1970 and 2019, families with a college degree saw a 24 increase in median income while the median income of families without a degree only increased by 4 percent.
This divide is worse in America than in other countries due to many factors. For example, corporations have more power than ever. Competition has declined and so have unions (along with protections for workers), giving companies even more power over workers. Plus, the college-educated tend to have greater mobility. College graduates have greater access to good-paying jobs and health care while Americans without degrees typically have fewer opportunities.
While changes to hiring practices, the health care system, and labor markets stand to change this trend, change of this magnitude would be long-term in nature. In the short term, a college degree is a wise investment in one’s future. Education, knowledge, skills, experience, and good judgment are all important to be successful in business.
In the Classroom
This article can be used to discuss the importance of studying business (Chapter 1: The Dynamics of Business and Economics).
Discussion Questions
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Why are life ratings declining?
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What accounts for the disparity in life expectancy among degree earners and non-degree earners?
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Why is the divide worse in America than other wealthy nations?
This article was developed with the support of Kelsey Reddick for and under the direction of O.C. Ferrell, Linda Ferrell, and Geoff Hirt.
Sources
Anne Case and Angus Deaton, "Without a College Degree, Life in America Is Staggeringly Shorter," The New York Times, October 3, 2023, https://www.nytimes.com/2023/10/03/opinion/life-expectancy-college-degree.html
Dan Witters and Sangeeta Agrawal, "In U.S., Poor Life Ratings Reach Record High," Gallup, August 22, 2022, https://news.gallup.com/poll/397286/poor-life-ratings-reach-record-high.aspx
Yascha Mounk, "Nothing Defines America’s Social Divide Like a College Education," The Atlantic, October 4, 2023, https://www.theatlantic.com/ideas/archive/2023/10/education-inequality-economic-opportunities-college/675536/