InSights
A newsletter from the Albers School of Business and Economics the Center for Leadership Formation Fall 2014
Back to Boom: Why Economic Drivers Make Graduate Education More Important Than Ever Marilyn Gist, PhD & Cindy Hamra, JD
D
espite the Great Recession, graduate education remains important. This is true for both individuals and companies as we return to economic growth. In this article, we review data that demonstrates the implications of graduate education in general. Then we turn attention to business education having emerged recently as the top program of study.
The Value of Graduate Education Today Among the variety of reasons that people choose to pursue graduate education are (1) increased earning potential; (2) better job prospects and security; (3) intangible benefits; and (4) overall high return on investment. The primary reason that many people choose to pursue graduate education is the increase in earning potential and in actual earnings. Evidence shows that education still predicts significant employment outcomes. For example, U.S. Department of Labor data showed that, for 2013, individuals with graduate degrees had an unemployment rate (3.4%) that was far below the national average (6.1%), and less than half that of people who had some college but no degree (7%). The pattern was similar for median (midpoint) earnings. Those with graduate degrees earned far more each week ($1,349) compared to the national average ($827), and roughly 83% more than those with some college but no degree ($727). (See chart 1 on page 4.) Although this data reflects median earnings
across all occupations, the pattern is equally strong for high-achievers across occupational groups. Those in the 90th percentile of earnings who have advanced degrees earn 91% more ($2,911) than the weekly earnings of those with an associate’s degree ($1,522; source: Bureau of Labor Statistics). (See chart 2 on page 4.) Continued on page 4