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May 15, 2009

HR Fact Friday: College Degree Pay Holds in 2007 as Earnings Fall

Filed under: Compensation — Tags: , , , , 8:54 am

Earnings growth slowed or declined in 2007 among workers at most education levels, while falling sharply from the prior year for men with only a high school degree, according to figures released April 27, 2009 by the Commerce Department’s Census Bureau.

Among all full- and part-time workers ages 18 and older, those with a bachelor’s degree earned $25,895, or 83% more per year than workers with a high school diploma, about the same difference as in 2006, the agency said in releasing annual data on educational attainment of the U.S. population.

Earnings increased 0.7% in 2007 for both groups of workers, to $57,181 and $31,286 respectively, down for gains of 3.8% and 5.5%, respectively, the preceding year, according to a BNA analysis of the data. By comparison, average annual earnings of all workers grew 1.6%, to $42,064, slowing from a 4.6% increase in 2006.

By gender in 2007, the most recent year for which figures are available, average annual earnings grew more slowly or declined from the previous year for both men and women at almost all education levels, except for male high school dropouts, whose pay rose 3.8%, up slightly from 3.7% in 2006.

Earnings of women with only a high school education rose 4.3% to an average of $24,234, while those of their male counterparts fell 1.4% to $36,839. On the other hand, women with a bachelor’s degree experienced a 0.4% decline in average annual earnings to $43.127, while their male peers realized a 1.5% gain to $70,898.

As a result of the different trends for men and women in the two educational groups, the pay gap between high school and college degree holders widened in 2007 among men but narrowed among women.

Men with a bachelor’s degree earned $34,059, or 92% more than men with only a high school education, up from 87% in 2006, while the pay disparity among women shrank to $18,893, or 78% from 86%.

In 2008, 87% of the U.S. population ages 25 and older had completed high school, and 29% had a bachelor’s or higher degree, with women outnumbering men by 29.4 million to 28.4 million, the Census Bureau said.

The Census Bureau derives the data from its annual social and economic supplement to the current population survey of 100,000 households.

Source: The Bureau of National Affairs, Inc, May 2009

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