It’s an age old dilemma – youth versus experience. Education versus street smarts. Now Georgetown University has put some numbers on what’s worth more – years of experience learning on the job or going to school and earning book smarts.
It turns out, there are quite a few fields where a fancy degree will earn you more money. A lot of their research supports common sense assertions – an advanced degree in a field like engineering or computers will earn you more money, $78,000 and $79,000 respectively. That tops the average salary for a teacher ($47,000) or a businessman ($69,000) who has worked for years but has only a basic college degree.
But if you stay within the same field, experience almost always wins out over higher education. Across the board, people who have worked longer make more money than recent graduates with advanced degrees. In fact, the only field where an advanced degree will beat out on-the-job training when it comes to salaries is teaching.
But the story changes slightly when you’re talking a basic college degree. We’ve all heard that going to college is worth it – the unemployment rate of college graduates is lower, they make more money, and so on. But that’s not always the case.
According to the Georgetown study, the average salary for a worker with only a high school education but years of experience is $37,000 across the board. In most fields, the starting salary for a college graduate with no experience falls under that level. Of course, over the course of their career, these college grads all end up earning more than high school grads.
However, there are a few fields where a college degree will get you a higher starting salary right off the bat. They are: architecture, business, computers/math, engineering, health and social science.
On the flip side, if you have earned your degree in agriculture, the arts, biology, communications, education, the humanities, law/public policy, psychology or the physical and social sciences… you’re probably going to be making less than the high school graduate in the cubicle next to you with decades more experience.
Some of that is counter-intuitive – who with a degree in law would expect to be making less than a co-worker with no training past high school? But in general, the Georgetown analysis still shows that college degrees carry a wage premium, and that the premium will only increase as the economic recovery continues. They wrote, “Even in the midst of a lackluster recovery, college degrees have retained their value.”
The study didn’t, however, look at how student loan debt plays into the equation. Student loan debt is now the most common type of debt in the U.S., topping $1 trillion. The class of 2014 was the most indebted ever, with the average graduate having some $33,000 to repay. That statistic is having many ripple effects, impacting what careers students choose and whether or not they start businesses.
It seems analyzing whether a degree is worth the money has become more important than ever.
What do you think is more valuable – a degree or experience? Let us know in the comments section below.
More from Yahoo Finance:
Rand Paul defends his war on the Fed
And the money goes to... Oscar nominees are already winners
Are the Girl Scouts making a mistake by selling cookies online?