Lifetime Earnings Soar with Education

Masters degree worth $2.5 million income over a lifetime

Dean presenting graduate students with awards outside college
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How much more is higher education worth in cold hard money than a high school diploma? Plenty.

A college master's degree is worth an average of $1.3 million more in lifetime earnings than a high school diploma, according to a recent report from the U.S. Census Bureau.

The report titled "The Big Payoff: Educational Attainment and Synthetic Estimates of Work-Life Earnings" reveals that over an adult's working life, high school graduates can expect, on average, to earn $1.2 million, while those with a bachelor's degree will earn, $2.1 million; and people with a master's degree will earn $2.5 million.

"The large differences in average work-life earnings among the educational levels reflect both differential starting salaries and also disparate earnings trajectories," noted the Census Bureau, "that is, the path of earnings over one’s life."
Persons with doctoral degrees earn an average of $3.4 million during their working life, while those with professional degrees, like medicine, law, and engineering do best at $4.4 million.
"At most ages, more education equates with higher earnings, and the payoff is most notable at the highest educational levels," said Jennifer Cheeseman Day, co-author of the report.
The figures are based on 1999 earnings projected over a typical work life, defined by the Census Bureau as the period from ages 25 through 64.

"While many people stop working at an age other than 65, or start before age 25, this range of 40 years provides a practical benchmark for many people," noted the Census Bureau.

Americans Staying In School Longer

Along with the financial data, the report also shows that more Americans are staying in school longer than ever before. In 2000, as 84% of American adults age 25 and over had at least completed high school and 26% had continued to earn a bachelor's degree or higher, both percentages all-time highs.

'Glass Ceiling' On Earnings Still Intact

The report also shows that while more American women than men have received bachelor's degrees every year since 1982, men with professional degrees may expect to cumulatively earn almost $2 million more than their female counterparts over their work lives. Glass ceiling aside, the U.S. Bureau of Labor Statistics reports that women who graduated from college earned about 76 percent more than women with only a high school diploma in 2004.
Additional highlights from the report show:

  • In 1999, average annual earnings ranged from $18,900 for high school dropouts to $25,900 for high school graduates, $45,400 for college graduates and $99,300 for the holders of professional degrees (medical doctors, dentists, veterinarians, and lawyers).
  • Over a work life, earnings for a worker with a bachelor's degree compared with one who had just a high school diploma increase by about $1 million for non-Hispanic Whites and about $700,000 for African Americans; Asians and Pacific Islanders; and Hispanics.
  • Currently, almost 9-in-10 young adults graduate from high school and about 6-in-10 high school seniors go on to college the following year.

A separate report released last year, "What's It Worth? Field of Training and Economic Status: 1996," said among people with bachelor's degrees, those working full time in engineering earned the highest average monthly pay ($4,680), while those with education degrees earned the lowest ($2,802) in 1996.

2016 Updated Figures

Without a College Degree: According to data most recently collected in 2016 by the U.S. Bureau of Labor Statistics, full-time workers age 25 and older without a high school diploma had median weekly earnings of $494 in the first quarter of 2016. That compares with a median of $679 for high school graduates who never attended college and $782 for workers with some college or an associate degree.

With a College Degree: Median weekly earnings were $1,155 for workers with a bachelor's degree and $1,435 for workers with an advanced degree—a master’s, professional, or doctoral degree.

Among college graduates with advanced degrees, the highest earning 10% of men—whose earnings were at or above the 90th percentile—made $3,871 or more per week; the 90th percentile for women with advanced degrees was $2,409 or more. Weekly earnings for the lowest paid 10% of men with advanced degrees—whose earnings were below the 10th percentile -- were less than $773 in the first quarter. That was slightly higher than the median earnings—the 50th percentile—of men who had completed high school but never attended college.