. . . If you want a decent paying job

 

click for ginormous chart

Data: BLS, FactSet, J.P. Morgan Asset Management. Source: Census Bureau, J.P. Morgan Asset Management;  Unemployment rates shown are for civilians aged 25 and older.

 

Source: JPM Morgan Guide to Markets, Q2 2013

 

 

Category: Digital Media, Employment

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

8 Responses to “Education Still Matters . . .”

  1. TerryM says:

    Barry,

    On the annual average earnings chart. Do you know if the charts include or exclude very high earning traders, investment professionals, C-suite executives, etc?

    While I agree that the directionality of the chart is likely correct, I am curious if the numbers are somewhat skewed higher due to a handful (in relative terms) of outliers.

    ~~~

    BR: I doubt it — it involves 10s of millions of data points, via BLS and Census Bureau

  2. rj chicago says:

    But BR – the link this morning is saying don’t sell the farm for college!!! ARRGGHHH!!!!

    ~~~

    BR: To quote F. Scott Fitzgerald “The test of a first-rate intelligence is the ability to hold two opposing ideas in mind at the same time and still retain the ability to function.”

  3. BenE says:

    Be careful there. Education is also a filter. In the less educated groups, there are those without the aptitude to get a university degree.

    Does a person that is smart and motivated enough to do well in university but chooses not to go still have difficulty finding a job?

    The causality chain could be: Well employed person –> likely smart and motivated person –> was likely successful at getting admitted and finishing school. In other words, people’s abilities to get a good job causes them to also be able to get good degrees. It’s not necessarily the good degrees that get them good jobs.

  4. constantnormal says:

    IMHO, there are two things that really matter … and matter a LOT more than what kind of a degree one has (BA/BS/MA/MS/PhD/…) … those being:

    1) what industry you work in — health care and finance being the biggies (at present). But mainly, you want to work closer to oceans of money, if financial reward is your goal.

    2) the personal connections you made while acquiring your degrees.

    Advanced degrees generally require a lot more cash to acquire, which means that the pool of students you are swimming in contains a lot of privileged folks, and personal connections made during the pursuit of those degrees stand a decent chance of paying off in later employment that pays quite well.

    Any knowledge or skills acquired along the way are superfluous in this regard.

    • cowboyinthejungle says:

      @ constantnormal…

      I agree on both counts, being unfortunately on the short end of each. Folks in my field who choose not to pursue the oceanfront property, as it were, have lagged financially. Though it should go without saying that this does not directly translate to a lag in quality of life.

      The flipside to the social network reward of paying to swim in the big pond is (nearly) equally true. In many sectors, the lack of an obvious wealth incentive attracts a different crowd of professionals, and consequently, the social capital earned most often pays in denominations outside of the financial realm.

      On one point, I would agree with a significant cause and effect relationship in Barry’s charts. Employment. Looking within any sector, greater educational achievement represents greater ability to navigate the system and effectively play the game…skills essential to gaining and maintaining employment.

  5. RW says:

    When disaggregated by gender, the data reveals higher income variance for male college graduates suggesting more of a crap shoot; e.g., depending on choice of field a good apprenticeship could pay larger lifespan dividends than a bachelors degree.

    Speaking from personal experience, a higher degree does not necessarily lead to higher income but it does provide more options and opportunity for job satisfaction.

    What BenE and constantnormal said: Confounding variables, latency and network effects abound in the ride to higher income. The size of the data set in this case makes it clear there is a strong correlation between education and income but it’s reasonable to suspect causality is not so straightforward (no real surprise there natch).

    Fitzgerald’s riff on Aristotle’s quote was waggish but the tolerance for cognitive dissonance on display these days suggests first-rate intelligence may not be the salient variable. The original quote remains true as always of course: “It is the mark of an educated mind to be able to entertain a thought without accepting it.”

  6. ashpelham2 says:

    What about those of us who have nearly given up on the dreams of great wealth working in the financial sector and are persuing our dreams as actors? :D No real degree required there…

  7. antonw says:

    Do this analysis by degree/major basis and you will see THE BIG PICTURE.
    I’ve studied the economics of education a lot since semi-retirement from college administration in 1989.
    Here is a summary.
    http://www.textbooksfree.org/Interesting_Thoughts_Concerning_Education_Print.htm

    See what major economists like Krugman and Greenspan have said.
    See why US really don’t test poorly and what the German’s do.
    See one solution to better education based on economic principles academic don’t like!