Want a good job by age 30? Skipping college could doom your chances.
Decades ago, young adults didn't need much more than a high school degree to secure a job with solid, middle-class wages. Today, such opportunities have become an anomaly, with a new study finding that young Americans without college degrees are more likely to be stuck in low-earning jobs than not by the age of 30.
In fact, earning a college degree is the surest path to landing a good job by age 30, according to an analysis from Georgetown University Center on Education and the Workforce. A good job, as defined by the study, is one that pays a median annual wage of $57,000 by age 30.
The findings come amid growing skepticism about the value of higher education, with a majority of Americans saying they don't believe a college degree is worth the cost, according to a recent poll from the Wall Street Journal and NORC. But without a college degree, young Americans are unlikely to find economic stability by age 30, the Georgetown analysis suggests.
"It's a completely different world"
"If you were a young person in the 1970s and your uncle worked at Chrysler and you were boy, you didn't even have to get a high school degree, truthfully" because such connections would help those young adults find good-paying jobs, said Anthony Carnevale, who directs the Georgetown center and is a co-author of the study.
"It's a completely different world," he told CBS MoneyWatch. "Beginning in 1983, the college premium went up, and that continues."
The college premium refers to the earnings gap between people who have a college degree and those who don't, with the typical college grad earning about $78,000 in recent years, compared with $45,000 for the average worker with only a high school degree, according to the Federal Reserve of New York.
That's not to say that people without a college education can't secure a good job by the age of 30, but they are less likely to achieve that financial security than young adults with bachelor's degrees, the Georgetown analysis found.
The researchers based their analysis on outcomes from the Bureau of Labor Statistics' National Longitudinal Survey of Youth 1997, a panel of almost 9,000 people born between 1980 to 1984 whose earnings and other outcomes were tracked in subsequent years.
"Very low" chances of a good job
A young person's path in their early 20s can set their economic destiny by age 30, the study found. Roughly 68% of young adults with a college degree by age 26 have a good job at age 30, compared with 25% of people with only a high school diploma, according to the analysis.
Young adults who aren't on the college track can experience a myriad of outcomes depending on occupation and training, which suggests that many could make changes that would put them on a better pathway to higher earnings, the analysis found. Those changes include switching jobs, earning a certificate or going back to school for an associate's or bachelor's degree.
For instance, among the least likely to secure a good job by 30 are young adults who aren't in college and are employed in low-wage jobs, such as in the restaurant or health care support industries, at age 22. Only about 14% of these workers are likely to achieve a good job by age 30, the analysis found.
If one of those worker switches to a job in a STEM-related field — but still doesn't have a college degree — they have a 25% chance of getting a good job by age 30, the researchers found.
"In the absence of experiencing a different pathway change, a different avenue to having a new, good job, their chances of having a good job are very low," noted Zack Mabel, report co-author and research professor at the Georgetown Center.
Failure to launch
Young adults today face more difficulties in establishing economic independence than prior generations, Carnevale noted. A college education can boost one's earnings over a lifetime, yet it comes at a cost, with many grads entering the workforce burdened with student loans.
"It used to be that by age 25, both genders were able to achieve what economists back in the day said was economic independence, and the readiness for family formation," Carnevale noted. "Now it's 32."
College tuition has risen at a rate far outpacing inflation, which has sparked some of the backlash against higher education. Some education reforms are aiming to break down the silos between high school, college and other pathways, such as dual-enrollment programs that allow high school students to take college classes and get a leg up on earning a degree.
Yet such programs aren't the norm, and switching pathways into more training or more lucrative fields isn't always easy.
"In the end, you need education, which means it'll take longer and cost a lot more money," Carnevale noted. "It's just tougher."