October 27th, 2006

College Grads Earn More, But Not Equally

It should be well-known to everyone by now that on average, getting a college degree results in more annual income -- in most cases, about double what you would earn with just a high school diploma alone. But as Diverse Issues in Education reports, new Census data shows that not all racial/ethnic groups receive the same income boost from their college degree:

[B]achelor-degree holders earned an average $51,554 in 2004, compared to $28,645 earned by high school graduates and the $19,169 earned by those without a high school diploma. . . . Black high school graduates earned $23,498 compared to $25,823 earned by Hispanics, $28,289 earned by Asians and $30,197 earned by Whites.

Even having a bachelor’s degree did not equalize earnings across races. Blacks with bachelor’s degrees earned $42,342 while Whites earned $53,411, Asians earned $47,912 and Hispanics earned $45,166. Blacks with doctoral degrees earned $82,615 compared to $94,426 earned by non-Hispanic Whites. . . .

Spriggs says the income disparities can’t be explained away with achievement gaps, the theory that Blacks would earn less in the marketplace because they’re not as skilled as demonstrated by lower test scores. Previous analyses indicate the annual earnings of Blacks are less than that of Whites with the same test scores, Spriggs says.

The article also notes that compared to men, women also continue to experience lower returns on their college degrees. Some of the differences can be attributed to differences in field of study/major and regional differences in salary, but as the last quoted paragraph notes, even after controlling for those other factors, workers of color and women continue to earn less than White and male workers.

In other words, American society has made progress in closing the racial and gender wage gap, but clearly, there is still plenty of room for improvement.

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