As featured in The Wall Street Journal, Money Magazine, and more!
     

Education Majors Earn Less Regardless of Career

This article was written by in Career and Work. 10 comments.


As I’ve mentioned before, I studied education as an undergraduate. I knew that my career as a public school teacher would limit my potential earnings over my lifetime, though I eyed administration as a potential progression. I diverged into non-profit work, and if I learned anything from my time working at a non-profit, it’s that it can be very psychologically fulfilling work, but rarely financially fulfilling. That’s great for someone who doesn’t need to worry about whether there’s enough money to buy groceries and pay rent or is willing to make great personal sacrifices.

I changed my line of work. At a financial firm, hindsight tells me I could have negotiated a higher starting salary, but it was already a great increase over my salary at the non-profit I had left just a short time prior.

According to new data from the U.S. Census Bureau, undergraduate students who majored in education and have attained at most a bachelor’s degree earn less than other students, even when they pursue a career path that is more lucrative. The bureau calculated and cross-referenced lifetime earnings for each major and each career field by grouping survey respondents into eight age buckets consisting of five years, determined the median annual earnings for each age group, multiplied the number by five, and added the totals together.

It’s an interesting method of calculation, and I don’t know whether I would have chosen the same method. If the purpose of the study is cross-discipline and cross-industry comparisons, the fact that it’s consistent is what’s most important. The bureau’s report acknowledges this: “This estimate is not intended to be a prediction but an illustrative example of the magnitude of differences in earnings based on factors such as education and occupation added up over a work life.”

Using this calculation, an engineering major who works in engineering in architecture throughout his or her life earns a figure of $3.6 million. Again, this is not a prediction of actual earnings, but a representation of the data useful for comparison. Business majors who take on the same work throughout their lives earn $2.9 million. An education major in architecture of engineering earns a full million less than the engineering major, even when pursuing the same career.

Education majors even earn less than business, computer, math, and science majors when pursuing careers in education, $1.8 million versus $1.9 million, though I expect that doesn’t reflect a statistically significant difference. That concentration in education seems to put people at a financial disadvantage for the rest of their income-earning lives. In one case, as the report indicates, education majors working in the service sector, the earnings are less than the average for those with just a high school diploma. I’m sure that’s not a fair comparison, however; a better comparison would be be within the service sector, education majors compared to those with no more education than the high school diploma.

When I was in high school — and this is twenty years ago so my memory may be hazy — those who weren’t sure what they wanted to do with their lives were encouraged to study business in college. I would say engineering is a better choice. Just having any college degree creates flexibility in career direction and increases human capital, but from a financial perspective, some degrees are more valuable. For a high school student, there might not always be an available choice between pursuit of a business degree and an engineering degree. The latter could require more intense coursework, and that might not be appropriate for every matriculating student.

One conclusion I can draw from the survey is advice for potential college students. Unless there is no career you could possibly conceive of pursuing throughout your life, don’t major in education. If you choose to become an educator, you can do so with any college degree without suffering any setback other than taking some extra time to gain certification in most states. There is no setback to teaching without a degree in education, except perhaps if the field you’d like to teach requires specific skills. If you’re so inclined, a double major in your field, like math or science, and in education could help.

The fact is that the role of a teacher is not highly valued in American society. The best teachers could be great at any job, and given the choice, many pursue better paying careers where their talents and skills are remunerated more favorably. From a practical perspective, a degree in most fields other than education offers more earning potential while still retaining the option of pursuing a teaching career without any detrimental effects.

Photo: Renato Ganoza
U.S. Census Bureau [pdf]

Published or updated October 16, 2012. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

Email Email Print Print
avatar
Points: ♦127,386
Rank: Platinum
About the author

Luke Landes, also known as Flexo, is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about him and follow Luke Landes on Twitter. View all articles by .

{ 10 comments… read them below or add one }

avatar jim

I bet people with education degrees make less than high school grads in service jobs simply because they have 4-5 years less experience in the job due to the time they spent in college. Consider 2 people who are 25 years old who work at a restaurant. One starts straight out of high school at age 18 and has 7 years experience and the other was in college till age 23 and is only on the job 2 years.

Reply to this comment

avatar jim

Wait I think I misunderstood. The study says people with Education majors who work in service make $1.3M lifetime and all high school grads average $1.4M. I thought it was comparing HS grads in service jobs versus Education majors in service jobs. All high school grads make more on average cause some jobs that high school grads hold pay OK versus the relatively low paying service fields.

Reply to this comment

avatar qixx ♦1,825 (Half-Dollar)

This could also be why someone with an education degree earns less in other fields. Moving from one field to another you will still have some salary parity. If you made peanuts at one place then you are more likely to accept what another field calls peanuts even though it is a substantial jump over your current/past salaries. If you make $20,000 and someone offers you $40,000 you might not notice that others in that new field make $50,000. You are happy to be making double.

Reply to this comment

avatar Jenna, Adaptu Community Manager

What about education professionals that go on to teach at private schools or colleges/universities? Do they make more money in the long run?

Reply to this comment

avatar Luke Landes ♦127,386 (Platinum)

It looks like the Census does have the data to determine that, but they haven’t broken it down to that level of detail in any of their reports, and the raw data don’t seem to be available. Private secondary schools on average pay less than public secondary schools, and that I know from my own anecdotal research into finding teaching jobs, but I’m not sure about colleges and universities. Professors often have PhDs which would invalidate them for the purposes of this comparison.

Reply to this comment

avatar krantcents

Most people who go into education understand that they won’t earn very much. I think it is more of a problem for the liberal arts majors. If they do not enter a training program or find a way to apply their education, they will become teachers. I think the profession needs people who want to do the job. The wash out rate for beginning teachers is around 50%.

Reply to this comment

avatar Lance @ Money Life and More

I’m not shocked and it is sad but true. Some of my friends’ parents are/were teachers and it can get crazy for what I assume they are paid. One second grade teacher had kids stealings things from their purse. It feels like how kids act has changed from when I was a kid just a decade or two ago.

That said they do get summers off… I’m jealous about that :)

Reply to this comment

avatar Ceecee ♦796 (Dime)

I am surprised by this data—-especially by the fact that even if ed. majors change their line of work they still earn less. I wonder if the salaries are in any way offset by the benefits. Many teachers still have standard pensions, which have all but disappeared in the business world. And, the health benefits are usually very good. And, as Lance pointed out, they do get every summer off, and many work other jobs during that time period.

Reply to this comment

avatar Jacob @ iheartbudgets

Sad but true. And we’ve known this for a while, this census just confirms it. But, though I think earning potential is important, educators can be frugal and still build wealth over time. I really do believe that. I like the suggestions of getting certified instead of a degree. You can save money and still get a job in the career you are passionate about. Heck, if you can graduate college debt free, I say go for it! I really think the key to wealth is not necessarily earning more (though it can help a TON), but spending wisely.

Reply to this comment

avatar Marie at Family Money Values

How much you make doesn’t necessarily determine how much money you end up with. Mom was a grade school teachers with a master’s degree. She taught about 20 years and made more than Dad most of that time. They saved and did well in wealth accumulation.

Teaching is a fast paced, difficult job that deserves higher pay, in my opinion. That said, I would never recommend that one of mine become a teacher – because there is no good career path and the pay is low.

Reply to this comment

Leave a Comment

Connect with Facebook

Note: Use your name or a unique handle, not the name of a website or business. No deep links or business URLs are allowed. Spam, including promotional linking to a company website, will be deleted. By submitting your comment you are agreeing to these terms and conditions.

Notify me of followup comments via e-mail. You can also subscribe without commenting.

Previous post:

Next post: