Why Don't Students From Low-Income Households See The Same Value In A College Degree?

college life

By Sean Leslie

In 1848, then congressman and former Secretary of the Massachusetts State Board of Education Horace Mann said, "Education then, beyond all other devices of human origin, is a great equalizer of the conditions of men—the balance wheel of the social machinery."

Mann was an evangelist when it came to the belief that access to a quality education could give an opportunity to the less fortunate to advance on the social scale, and he championed the idea that inclusive education would "equalize the conditions of men."

It's a belief that many hold to this day. In 2011, 163 years after Mann first coined the phrase, then U.S. Secretary of Education Arne Duncan echoed Mann's sentiment: "In America, education is still the great equalizer."

This is a nice thought, and a notion that falls in line with what have traditionally been considered American values: that in the United States, with enough hard work and good decision-making, anyone, no matter who they are or where they come from, can be a success.

As president Barack Obama put it, more eloquently, in 2014 at the College Opportunity Summit, "That's an essential promise of America. Where you start should not determine where you end up."

Indeed, a 2011 study showed that workers who receive a college degree earn 84 percent more over the course of their career than workers who attained only a high school degree. (With the cost of college having risen by about 260 percent over the past 37 years—a change from $37,752 to $95,488 over four years, including tuition, room and board, and fees—one would hope for that sort of significant return on investment.)

Is a College Education Really "The Great Equalizer?"

While the 84 percent figure is an encouraging statistic and seems to reinforce the idea that education is still "The Great Equalizer," PayScale's recent research indicates that some college graduates are more equal than others.

According to a survey of 1,280,305 respondents to the PayScale salary survey collected between February 2007 and February 2017, "college graduates that come from wealthy households when entering school have a greater mid-career earning potential post-graduation." Put more succinctly, when you graduate from college, if you come from a rich family, you're probably going to make more money than someone who graduated from college but comes from a poor family. (We defined "wealthy households" as those who reported being in the top 25 percent of income distribution.)



Our survey showed the mid-career median pay for respondents whose household income was in the bottom 25 percent of the income distribution (again, self-reported) when they attended college is $72,700. The mid-career median pay increases to $80,100 for respondents whose household was in the middle 50 percent of the income distribution. And respondents whose household income was in the top 25 percent have the highest mid-career earning potential post-graduation, with a median pay of $99,600. This pattern holds true across job levels.

What can we take away from this data? If your family is richer than average to start with, you're going to be richer than average when you leave college.



But that's not all.

Our study also showed that even after completing college, workers who come from higher household income brackets are more likely to become executives than individuals from lower household income brackets. (Of course, executives are likely to have higher salaries.)

Why Doesn't College Level the Playing Field?

We don't know why this inequity exists. Why does, seemingly, a college degree held by a student coming from a poorer household not deliver the same return on investment as a college degree held by a student coming from a richer one?



Perhaps it's because students from richer households are already set up with connections within their chosen field of employment thanks to their already-wealthy parents? Perhaps it's because of unspoken norms that differ between social classes, norms that are observed and understood by high-earners and the children of high-earners but which poorer students and workers are less likely to recognize and/or adopt.

The extreme and ever-rising cost of a college education may also play a role, as many students who come from low-income households have to work long hours to pay for their education at the same time that they're attending school. A 2016 report by the Washington Post noted:

What [researchers] are finding is that low-income students don't experience college the same way as their affluent peers. The networking, the job access, they just can't be college kids. No time for fraternities or sororities, no intramural lacrosse teams, and forget about the a cappella group. Kids from low-income backgrounds are just trying to hang on and hang in.

A Double-Edged Sword: More Debt and Less Earning Power

Combined with the fact that college continues to become less affordable, our research indicates that students coming from the poorest households—who often have to borrow the largest amount of money to attend college at all—leave university positioned to make less than their wealthier peers, who likely don't have to borrow as much, if at all. This most unkindest cut means that college graduates who are most often saddled with massive loans are least able to repay them. And this, in turn, means the likelihood of these graduates eventually living in the most affluent households is significantly reduced, meaning their children will likely face the same disadvantage, continuing a cycle of inequality.

How Do We Break the Cycle of Debt-Burdened Graduates?

According to a 2016 study, "Nearly two-thirds of Americans are in favor of free college for everyone, and about three-quarters think at least some people should be eligible for free college."

Says the study:

62 percent think tuition at public colleges and universities should be free for all students, and about a quarter of those who oppose making college free for everyone think it should be available to families with incomes below $50,000.

The study also indicates that about 50 percent of Americans are willing to pay higher taxes to guarantee free college for American students.

Indeed, 2016 presidential candidates Bernie Sanders and Hillary Clinton both included a plan for free college tuition in their campaign platforms, recognizing the importance of an educated workforce as it relates to a healthy national economy.

And there may be reason for optimism; as of April 10 of this year, New York became the first state in the nation to offer a "free four-year college education" to its residents who come from homes with a household income of $99,000 or less.

According to NBC News:

There is no age limit for the program; once students receive the Excelsior Scholarship they must be enrolled full-time with an average of at least 30 credits per year and continue to meet the minimum GPA requirement for their program.

With any luck, the steps taken by New York will kick off a national movement, which might be our best bet at truly making higher education "the great equalizer," it was always hoped it would be.

Tell Us What You Think

Did you struggle to pay for college? Did your experience impact your professional future? We want to hear from you! Tell us your story in the comments or join the conversation on Twitter.

Sean

About the Author
Sean Leslie is the Sr. Content Strategist at PayScale.com, and he writes for PayScale about work, salary, work-life balance, combining your passions with your career and whatever else catches his fancy. Sean's a happy husband and father; an erstwhile runner, mountain biker, backpacker and outdoorsman; and though English by birthan adopted and fiercely proud Pacific Northwesterner.

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