The number, 800,000 dollars, has been used often to describe the advantage of a college education over a high school diploma. However according to new data, the actual value is $450,000 dollars. If that isn’t bad enough, according to the American Institutes for Research, it’s only worth $279,893.

Let’s figure it up. The number of working years used is forty. So if we divide 800,000 by forty, we get 20,000 dollars a year in advantage over someone with a high school diploma. Now let’s look at the revised figures. At 450,000 dollars, a college degree adds 11,250 dollars, which is much less impressive than 20,000 dollars. But if the American Institutes for Research is correct, it is only worth about 7,000 dollars.

Now, none of this takes into consideration, the costs of college itself, in particular the burden of paying off students loans which can easily get into the tens of thousands.

Am I discouraging you from pursuing a higher education? Certainly not, there are many advantages, intellectual and otherwise for going to college. I do want you to be aware that we might want to contemplate some kind of structural change in how we pay for education and how education is rewarded in the job market.

And be cautious about these kinds of statistics. The first decade of the twenty first century was cruel to the middle and lower classes. They lost a lot of economic ground. One of the things that was hit hard was earning power. Whole classes of jobs disappeared. The very, very few new jobs carried much lower salaries and reduced benefits.

Take a look at this film on college costs:

James Pilant

(This is a repost of a column I wrote some months ago.)