Introduction to College Education and Wage Gaps

College yields higher earnings post graduation for all Illinois students, but disparities persist among graduates from low-income families, even if they have the same college degree, as peers from more affluent families.

Study Findings

This is a key finding of a new study. It was done by the Illinois Workforce and Education Research Collaborative. There are also disparities when it comes to Black, Latino, and women workers. State Education Superintendent Tony Sanders said he was not surprised. “It’s something that is certainly a societal issue,” he said. “It’s something we need to really begin to tackle.”

Data and Methodology

The report uses data from the High School to Careers initiative that tracks students from high school into adulthood. The study includes students who graduated from high school between 2008 to 2012. The state also used that data to create a tool that students can use to explore career paths. Sarah Cashdollar, a researcher with the collaborative, said this report answers the “million dollar” questions for Illinoisians. “I think people are increasingly questioning, ‘is the American dream still achievable?’” she said. “Does someone born into a low-income family have real opportunity for upward mobility, and if so, is the best route still a college education?”

Earnings and Education

The study found that college graduates tend to earn more on average than those without a degree. About 72% of students from the highest-income families earned a bachelor’s degree or higher degree, compared to 25% from the lowest-income families, according to the study. Students from the highest-income households earn about $15,000 more annually than those from the lowest-income households, and the earnings gap between racial and ethnic groups is even wider — about $18,300 between Asian and Black graduates.

Persistence of Disparities

These differences persisted even when students from low-income households earned a more advanced degree or worked in a lucrative industry. The study doesn’t attempt to answer why these disparities exist, but other research points to differences in the type of universities students attend, learning opportunities, and social networks and connections, Cashdollar said. Also, there is a lot of research about workplace discrimination, she said.

State Response and Future Plans

Sanders said the state has many programs to help low-income students get into, pay for, and succeed in college. He hopes people continue the conversation around pay disparity. “The importance of this study is to demonstrate that college remains the most viable option if you want to break generational poverty. College is the path to do that,” he said. Cashdollar said she hopes the study will help young people make decisions about their future. “We’re not saying that everybody needs to get a four-year degree or even a college degree. It’s not necessarily right for everyone, but whatever they do, it should be informed.”

Conclusion

In conclusion, while college education remains a key factor in achieving higher earnings, disparities among graduates from different socio-economic backgrounds and racial groups persist. It is crucial for policymakers, educators, and the community to address these disparities and ensure equal opportunities for all students to succeed.

FAQs

• Q: Does college education still lead to higher earnings in Illinois?
  • A: Yes, according to the study, college graduates tend to earn more on average than those without a degree.
• Q: What are the earnings gaps between different income and racial groups in Illinois?
  • A: Students from the highest-income households earn about $15,000 more annually than those from the lowest-income households. The earnings gap between racial and ethnic groups is about $18,300 between Asian and Black graduates.
• Q: What are the state’s plans to address these disparities?
  • A: The state plans to release a follow-up study that takes a deeper look into low-income students with high-paying careers and aims to identify “promising pathways” to improve resources for Illinois teens.