Do you need a college degree to succeed? Here's what the data shows.
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College was once widely viewed as a pathway to success, but today only about 1 in 4 Americans say a bachelor's degree is necessary to secure a well-paying job, according to a new survey from the Pew Research Center.
Fifteen years ago, about 3 in 4 people told Pew that a college degree was extremely or very important to get ahead in life. The shift comes as higher education costs continue to soar, with some universities now charging close to $100,000 per year for tuition and other costs.
At the same time, employment opportunities and earnings for young men without college degrees have improved in the last decade, reversing some of the economic damage that eroded the group's fortunes starting in the 1970s.
"Things are looking up for less-educated young men," Richard Fry, senior economist at Pew, told CBS MoneyWatch. Americans' changing views about college could be based on "not just improving labor markets and outcomes for less educated young men, but it's also clear that there is concern about borrowing for college."
Young men with only a high school degree have seen a slight rebound in their earnings since 2014, Pew found. The median annual income for men 25- to 34-years-old without a college degree was $45,000 in 2023, a 15% increase from $39,300 in 2014 when adjusted for inflation, according to Pew's analysis of Census data.
Generation gap
But while less educated young men are doing somewhat better than they were a decade ago, they still haven't caught up with the earnings of older generations of men at the same age in the 1970s. In 1973, young men without college degrees were earning almost $58,000 a year. That means the typical income for this group remains 22% lower than half a century ago, according to Pew.
"If you were a high school-educated young man in the early 1970s, it was more likely you were a member of a trade union, the manufacturing employment was much greater. So, in short, starting in the 1980s things shifted away from opportunities for less educated young men," Fry noted.
"In the grand scheme of things, young, less educated men aren't where they were 50 years ago," he added.
Young women without college degrees have, in some respects, fared better than young men, partly due to their expanding job opportunities. Their earnings have bumped up from about $35,000 annually in 1973 to $36,000 today. But young women with college degrees still earn far more, at about $65,000 per year, Pew found.
More income and wealth for college grads
When asking if a college diploma is important to secure a "well paying" job today, Pew didn't define the term, leaving that open to a person's interpretation, Fry said.
But the data from Pew's analysis clearly shows that the typical college graduate today not only earns far more than their counterparts with only a high school education, but also is able to amass much greater wealth as well. In other words, a college degree opens the door to a lifetime of higher earnings, which, in turn, helps unlock ways to build wealth such as jobs with 401(k) plans and stock equity plans.
That's not to say that young workers without a college degree can't also earn higher incomes or build wealth. For instance, people who go into trades like plumbing or welding typically earn higher incomes. The median annual pay for plumbers is $61,550 — significantly higher than the typical $45,000 in annual income for high school grads, according to the Bureau of Labor Statistics.
But that's still far below the $77,000 median annual income for young male college grads and below the $65,000 median income for young women with college degrees.
Young college grads also have roughly quadruple the wealth of their less educated counterparts, Pew found. People between the ages of 25 and 34 with a bachelor's degree have an average net worth of about $120,000, versus about $31,000 for those with just a high school education.
"Higher education generates higher wealth," Fry said. "Wealth tends to come from two places: home equity and stock equity or retirement assets. Families with college-educated heads have a higher homeownership rate. And college-educated adults are more likely to have access to 401(k)s and 403(b)s," referring to employer-sponsored retirement programs.
Is college worth the money?
Half of Americans told Pew college is worth the money only if you don't have to go into debt, Pew found. Only 22% see the investment as worthwhile if you have to borrow to earn the degree.
"I'm a bit surprised at how low it is," Fry said of the 22% share, "but it suggests that how you pay for college is also of concern."
That comes as Americans have accumulated $1.7 trillion in student debt, a burden that has made it harder for some to buy homes or achieve other hallmarks of middle-class life.
Among the most skeptical about the value of college are Republicans, with the survey finding that almost 6 in 10 GOP-leaning respondents said it's less important to have a college degree today versus 20 years ago. About 4 in 10 Democrats agreed with that proposition.
Such views could amount to a red flag for the higher education sector, especially as the share of young, male high school grads who are enrolled in college has declined. And some colleges have closed in recent years due to low enrollment and other financial challenges.
"College administrations and boards and presidents should be concerned with these perceptions of the value of college," Fry said.