In the United States, high school students have long been told that going to college will mean earning more than peers who do not go to college. Hard work and ambition are rewarded, our culture promises. Higher wages for college degrees are also good for society, we're told; the prospect of higher pay entices more people to sacrifice short-term wages while in school for the eventual reward awaiting those filling the economy's need for workers with professional and technical expertise.
And now, students are assured, they'll be able to pay back student debt when those higher wages kick in.
For decades, there was no asterisk in these talks with high school students or in all the wonky economic reports about wage gaps between those with and without degrees. Before 1960, all graduates could anticipate the same "wage premium", regardless of family background.
There now has to be an asterisk. A new working paper by economists Zachary Bleemer and Sarah Quincy documents that earnings for college graduates now correlate with childhood family income. The relative "wage premium" for students from low-income families has halved since 1960.
Yes, going to college pays off for the children of low-income students, but it pays off more for more privileged children.
The paper, Changes in the College Mobility Pipeline Since 1990 analyzes three reasons for these recent gaps in the "wage premium" for going to college:
- The regional, teaching-focused state universities where many students from low-income families enroll have experienced budget cuts, declining retention, and decline in relative value to students.
- Students from low-income families have been steered toward for-profit universities or two-year colleges since the 1980s.
- High admissions requirements for restricted access to such majors such as computer science, engineering, or finance mean that students from high-income families are enrolling in the most lucrative majors while those from lower-income families are more likely to be enrolled in the humanities.
Together, the authors argue,
The declining relative value of college-going for lower-income students since 1960 has significantly disrupted those students’ upward mobility.
Significantly.
Bleemer and Quincy are clear that the relative decline in the value of degrees for students from low-income families are rooted in a series of policy changes, from growing gaps in funding for research and teaching universities, to the very limited access to the most lucrative majors, to the flow of federal financial aid to for-profit colleges.
Campuses should of course support the personal accomplishments of low-income/working-class first generation students.
It seems that it would also be very supportive of these students and their communities if we educated many more college students about structural social class inequalities from which so many students – especially those who will have the power to shape public policy – benefit, while others work incredibly hard for diminishing returns.
