REGENTS REPORT

South Dakota Higher Education May 17, 1996 Good Investment. Great Future. Number 43

The Economic Value of Higher Education

A Look at Economic Implications of Increased Education

A recent Regents Report examined the linkages between increased educational attainment and community benefits such as reduced welfare dependency and increased participation in civic affairs. But what about the economic benefits of pursuing a post-secondary education? A number of studies in recent years have found the correlation between increased education and enhanced earning power for individuals, but what impact is increased education having on employability and the economic health of families? The following data show that the receiving post-secondary education increases employability and family income, and dramatically decreases a family's prospects of living below the poverty level.

Economic Correlates of Education--What Are They?

	In 1993, the employment rate for recent high school graduates not enrolled in post-secondary education 
	was 64.2%, while the employment rate for recent high school dropouts was 46.9%. Both rates show a  
	decline from their position twenty years before.

SOURCE: Bureau of the Census, October Current Population Surveys.

	In 1993, the median total money income of families in the U.S. headed by someone with at least a 
	bachelor's degree was $64,941, nearly three times that of families headed by high school dropouts 
	and nearly twice that of families headed by high school graduates.

SOURCE: Bureau of the Census, Current Population Reports, P60-188.

	In 1992, 2.2% of American families headed by someone holding at least a bachelor's degree were  
	reported to be below the poverty level--less than one-tenth the poverty rate for families headed by 
	high school dropouts, and one-fifth the poverty rate for families headed by high school graduates.

SOURCE: Bureau of the Census, Current Population Reports, P60-185.

CONCLUSION--The information above powerfully illustrates the increasing importance of post-secondary education in the United States, not only for students, but for their families as well. It also underscores that education, because of its ability to improve a person's economic and social prospects, should be viewed as an investment, not simply an expense.

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