Study: College Graduates Are Better Protected Against Worst Effects of Recession: News of the Day

by Press Staff

Years of research have demonstrated that a college education has the power to promote upward economic mobility. With the coincidence of the Great Recession and the rise in college costs, however, many have questioned the value of advanced degrees. A new analysis of federal data released by the Pew Charitable Trusts yesterday shows young adults with bachelor's degrees are faring much better than their less-educated counterparts. From the USA Today:

Findings, which complement multiple studies showing that a college degree significantly increases a young adult's chances of gaining economic security, suggest that the advantage held true through the recent economic recession...

Among findings:

  • Jobless rates were most severe for young adults with no college degree. Employment rates before and after the recession declined 7% among bachelor's degree holders, 11% among associate's degree holders and 16% for those with only a high school diploma.
  • All groups saw wage drops during the recession, but the falloffs stabilized most quickly for bachelor's degree holders. Average weekly wages dropped 5% for bachelor's degree holders, and twice that (10%) for workers with high school diplomas only. Associate's degree holders took the steepest hit, 12%.
  • College graduates continued to be employed in relatively high-status jobs at higher rates than their less-credentialed counterparts, and declines in the proportion taking jobs that did not require a college degree were modest — 3% vs. 6% for associate's degree holders.

This study provide strong evidence that even under the pressures of the most recent economic downturn, a four-year college degree has provided protection in the labor market for recent college graduates.

For this reason, Democrats in Congress have worked to put college within reach for every American and help students manage their loans. Under the College Cost Reduction and Access Act, legislation written and championed by Rep. George Miller (D-CA), senior Democrat on the committee, Congress made historic investments in student aid at no new cost to taxpayers. Democrats continued that historic investment in the Student Aid and Fiscal Responsibility Act, passed along with the Health Care and Education Reconciliation Act of 2010.

As our economy continues to recover it is critical to keep higher education within reach for students and families. Congress must be steadfast in its commitment to providing meaningful student aid programs to every eligible student, address the doubling of student loan interest rates for need-based loans for more than 7 million students this summer and ensure every eligible student can receive their full Pell grant.