Washington college degrees pay off quickly, study finds
SEATTLE – A new state analysis shows it takes Washington college graduates two years past graduation to start to earn more money than their friends who didn’t go to college and to get on the path toward making up their financial investment.
In the first of what likely will be many studies of the state’s new preschool-to-work education database, state officials are confirming one of the widely accepted beliefs about education: A college degree will boost a person’s earnings.
The bachelor’s degree earnings boost begins about six years after high school graduation with $4,775 more earnings for women and $1,516 more for men. In the seventh year, women with bachelor’s degrees earn a $5,432 bonus, and men get a $6,226-a-year boost.
The study found that college students forgo up to $55,000 in potential earnings during college, but they quickly make up for lost time in the first few years after they graduate.
“It adds to the evidence that there’s a good payoff to college,” said economist Greg Weeks, who was one of the primary investigators on this report from the state’s Education Research and Data Center inside the Office of Financial Management.
The study also confirms another widely held belief: Men earn more than women, even if they both have a college degree, at least in Washington state.
Among the group that only went to public high school and graduated between 2005 and 2007, women earn between $4,500 and $7,200 less than men in this Washington study. For those who went on to earn a bachelor’s degree, women earn $6,100 less than men seven years past high school graduation.
Men with only a high school diploma earn about a same amount on average as a woman with a bachelor’s degree, about seven years after high school, the study found.
Researchers controlled for as many of the other behaviors that could lead to more income, so that the adults they compared had similar high school GPAs, worked in similar job markets and, to begin with, were just as likely to go to college as each other.
They tried to make the best case possible, correcting for as much selection bias as they could.
“You never have a perfect study,” Weeks said. “I feel like this is both pretty solid and pretty good results.”
A national study by the Pew Research Center found an even bigger financial gain for college graduates. But the Washington researchers said that study, called “The Rising Cost of Not Going to College,” did not correct for selection factors such as family income like the Washington report, which found a 20 percent income gain, compared to the Pew report’s finding of 62 percent.
State officials hope more researchers will take advantage of this new longitudinal data set, available in part because of financial help and encouragement from the federal government.
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