Which college majors offer the best long-term return on investment?
As the cost of college continues to rise and doubts about the value of higher education increase, many Americans are questioning whether a bachelor’s degree is still a worthwhile investment.
An in-depth analysis of Texas public college students reveals that graduates generally earn significantly more than individuals without a degree, even in fields like liberal arts.
Conducted by the Postsecondary Commission, a nonprofit organization focused on education, the study followed approximately 29,000 students who enrolled in bachelor’s degree programs during the 2008-09 academic year. Researchers then tracked the graduates’ “cumulative net value-added earnings” over the subsequent 15 years.
This metric compares the total earnings of graduates over a specified period with those of individuals without bachelor’s degrees, while also deducting educational expenses such as tuition, room and board, and lost income during college.
On average, college graduates earned nearly $87,000 more over the 15-year period compared to high school graduates, even after factoring in college costs.
While engineering and architecture majors experienced the highest returns, even liberal arts majors, who typically have lower earning potential, outperformed their peers without bachelor’s degrees by approximately $35,000, according to the study.
“Individuals pursuing a bachelor’s degree, regardless of their field of study, are likely making a wise financial investment,” said Michael Itzkowitz, president of the HEA Group, a higher education consulting firm, commenting on the findings. “This financial gain is expected to grow over time as these graduates progress in their careers.”
The study conducted by the Postsecondary Commission is specific to Texas students, and results may vary in other states due to regional economic disparities that may necessitate different levels of job training, Itzkowitz pointed out. However, the analysis demonstrates that even fields of study with lower average salaries can offer economic advantages for college graduates.
“This study is comprehensive in its approach, accounting for opportunity costs by considering the expenses foregone while attending college compared to those who enter the workforce immediately after high school,” he added.
Additional Benefits of Different Degrees
While earning a bachelor’s degree can significantly boost earnings, the analysis also evaluated the long-term financial impact of associate’s degrees and other certificates.
Most associate’s degrees resulted in positive returns, with the construction trades field offering the highest payoff of approximately $72,000 over 15 years post-credential attainment.
On the other hand, certain two-year programs such as culinary services and logistics led to net losses of around $13,000 and $15,000, respectively.
Certificate programs also yielded varied outcomes. Construction trade certificates had the highest return, generating roughly $48,000 over 15 years. However, seven certificate fields, including social sciences and information technology, resulted in net losses during the same period.
