College is an investment for the future, it is expensive and time consuming but it is well worth it.  In December of 2007 the United States fell into a great recession, and there were too few good jobs available for new college graduates.  This left many graduates with high levels of debt and no efficient way to pay it off.  This posed a challenge to the value of a college degree and whether or not it is worth it for high school graduates to try and earn a bachelor’s degree.  This really is no challenge because 84 percent is the average wage difference between a person with a bachelor’s degree and someone with no more than a high school diploma (Carnevale 2015).  Earning a bachelor’s degree is the best option for a high school graduate, so how is the value of a bachelor’s degree measured and what major should a student choose to be financially best off?  Is the value of a bachelor’s degree declining, if so how can this be stopped and if not then how can it be kept that way?

Picking a major can be one of the hardest decisions a college student makes but determining the value of each major is essential when making this tough decision.  There are a lot of factors that go into measuring the value of a major.  These are; median earnings, earnings variation for all graduates, earnings by gender and race, the likelihood that a person with a specific major will obtain a graduate degree and the earnings return that a graduate degree holds, the industries that employ the most workers with various majors, and employment status.  There are about 171 different majors in University’s and College’s in the United States, these majors can be placed into 15 major groups.  These groups are; Agriculture and Natural Resources, Arts, Biology and Life Science, Business, Communications and Journalism, Computers and Mathematics, Education, Engineering, Health, Humanities and Liberal Arts, Industrial Arts and Consumer Services, Law and Public Policy, Physical Sciences, Psychology and Social Work, and Social Science. To fully understand if a bachelor’s degree is worth while one must understand how to measure the value of the three best majors a student can choose and the worst major a student can choose based on the data given from the publication, The Economic Value of College Majors (Carnevale 2015).  

The most valuable major a student can choose is a petroleum engineering degree.  This ranks at the highest value for any major to be chosen.  To determine the value, we have to look at multiple figures and take everything into account.  The largest factor favoring this major to be the most valuable are the earnings.  The median earnings are $120,000, the 25th percentile is $82,000, and the 75th percentile is $189,000.  This means that a student majoring in petroleum engineering has a 25 percent chance to make up to $189,000 when they graduate.  There’s room for $69,000 of earnings increase just between median salary to the 75th percentile, this shows that there are potential earnings increase beyond the 75th percentile as well.  Another large factor is that 97 percent of students that have graduated with a petroleum engineering degree are employed.  And 95 percent of petroleum engineering degrees are working full time.  Lastly 33 percent of students who major in petroleum engineering will go on and get a graduate degree but they will only receive a 7 percent boost in their wage.  At the 75th percentile that is a $13,230 pay increase per year (Carnevale 2011).  The statistics prove why the petroleum engineering major is the most valuable major a student can choose. 

The second most valuable major is pharmacy pharmaceutical sciences and administration.  The largest determining factor again are the earnings.  The median earnings are $105,000, the 25th percentile are $83,000, and the 75th percentile are $120,000.  In the health major group, the next highest median earnings are $40,000 less than pharmacy pharmaceutical sciences and administration.  Moreever, the 25th percentile earnings of $83,000 are higher than all of the 75th percentile earnings in the health major group.  98 percent of all pharmacy pharmaceutical sciences and administration majors are employed after graduation.  48 percent of pharmacy pharmaceutical sciences and administration majors went on to obtain a post graduate degree giving them an average earnings boost of 13 percent.  The 13 percent earnings boost equates to $15,600 more a year to the 75th percentile earnings (Carnevale 2011).  This data helps prove why the pharmacy pharmaceutical science and administration major is the second most valuable degree to have.  

The third most valuable major a student can choose is a mathematics and computer science major.  Less than 0.5 percent of students in the mathematics and computer science major group choose the major of mathematics and computer science.  Furthermore, this adds a ton of value to the degree because of how scarce the degree is in the job market.  The earnings are another great value to this degree, the median earnings are $98,000, the 25th percentile are $75,000, and the 75th percentile are $134,000.  The earnings of the 25th percentile at $75,000 are very close to those of the median earnings in the mathematics and computer science major group.  The percent employed however is the lowest out of the major group at 90 percent, this is what makes this major fall short to come in third place (Carnevale 2011).  This degree is still highly sought after and a extremely valuable degree to have and the scarcity of it puts it over that threshold making it the third most valuable major.

Seeing data of the most valuable degrees means nothing unless you have more data to compare.  Counseling psychology is the least valuable degree a student can choose with a median earnings of $29,000, 25th percentile of $21,000, and a 75th percentile of $42,000.  This degree does not have much room for earnings increase compared to the best valued majors, there is only a $13,000 difference between the median earnings and those in the 75th percentile.  Of the 14,715 people with a counseling psychology degree, 70 percent of them have gone to obtain a graduate degree on average boosting their earnings by 67 percent.  This earnings boost adds $28,140 to a graduate in the 75th percentile (Carnevale 2011).  Although this is a great earnings boost, there are many majors that a student can choose that will give them the same or greater earnings without needing a graduate degree.

After seeing how all the different numbers play against each other we can see how the values of majors are determined therefore finding the value of different bachelor degrees.  The value is not just determined by the earnings (although they play a major role), but also by the scarcity of the major, the opportunity for an increase in earnings, the graduate degree earnings boost, and the employment rate.  In 2009 a survey asked college students whether the education they got was worth the cost?  These students who were asked this question were up against a very weak labor market, still 79 percent said yes, and two thirds of those who dropped out without earning any credential said yes as well (Rose). 

With the growing number of bachelor degree holding laborers entering the workforce, it is important to know if the the value of a bachelor’s degree is declining or not.  Determining if the value of a bachelor’s degree is declining or not factors in how the costs of college varies with the potential earnings for a graduate and the unemployment rate (Abel).  

During the recession a large number of graduates were trying to enter the job market but no jobs were hiring.  Companies needed experience, not just a degree. This left many graduates unemployed or underemployed.  After the recession hit in December of 2007 the unemployment rate went from 5 percent to 9.5 percent in June of 2009 (“The Recession of 2007–2009.”).  The recent graduates were often overqualified for the jobs they could find, making them underemployed.  About 48 percent of the employed United States college graduates are in jobs that require less than a four-year college education.  Eleven percent of employed college graduates are in occupations requiring more than a high school diploma but less than a bachelor’s degree.  37 percent of college graduates are in occupations that require no more than a high school diploma.  The proportion of overeducated workers has grown substantially, in 1970 fewer than one percent of taxi drivers and two percent of firefighters had a bachelor’s degree.  Now more than 15 percent have degrees in both professions (Vedder). 

Countless news stories have shown that education costs are very high and the debts associated with them are just as astronomical.  The news stories say this is stopping many from attending college, although total college attendance is higher than ever.  This is because the price of a college education is often misrepresented.  News sources report that a college education cost $60,000 annually for tuition, fees, and room and board, yet they fail to mention how few schools actually charge this amount and how few students actually pay this amount.  Less than 10% of four-year college students pay total out-of-pocket expenses over $40,000 a year.  At public four-year colleges and universities, the net price was $2,910 and at private four-year schools it was $13,380 (Rose).  These are the average costs that most students are incurring, not these ridiculous figures that the media keeps portraying.

The media also led a lot of misconstrued information about debt and student loans.  Almost 35 percent of students do not owe anything when they graduate, about 65 percent of graduates owe on average $26,000.  Only one in 250 graduates owe over $100,000 of debt.  Most students who do incur high debt have gone to law or medical school.  These graduates are willing to incur this debt because of their salaries associated with their degrees.  Some commentators will point out that student loan debt is now over $1 trillion, passing total credit card debt.  This may be a worrisome figure, but the debt is for an education that is an investment that leads to a significantly higher income in the future (Rose). 

The other costs that goes into obtaining a bachelor degree are the opportunity costs.  Opportunity cost can be defined as the value of the next highest valued alternative use of that resource (Henderson).  The out-of-pocket expenses are only a small part of the total cost of college when the opportunity costs are considered.  Because attending college full time requires delayed entry into the workforce the opportunity cost of this time being spent in college are the wages a high school graduate could earn in four years.  Someone perusing a bachelor’s degree would give up nearly $96,000 in wages.  This opportunity cost added on top of the out-of-pocket expenses, increasing debt, and unemployment rates start to question if the value of a bachelor’s degree is declining (Abel). 

The recession made it clear that just having a bachelor’s degree wasn’t enough for that short time period.  Over the past ten years a lot has changed and the value of a bachelor’s degree has increased even after the number of graduates has risen.  This means higher potential earnings for recent graduates.  On average a bachelor degree holding worker will make 84 percent more than those who only posses a high school diploma.  The job market has seen quite an increase in workers with a bachelor’s degree, the concentration has grown from 28 percent in 1992 to 34 percent in 2013.  The increased concentration of degrees makes them less scarce making them less desirable for employers.  In the research done by Abel and Deitz we can conclude that the potential earnings for workers with a bachelor’s degree has decreased.  But the potential earnings for a worker with a high school diploma has also decreased.  As a result, the bachelor degree earnings has still remained near its all time high (Abel). 

The potential earnings for college graduates have been held stagnant and slightly decreased during the 2007 recession (as well as those with just a high school diploma).  The costs of obtaining a bachelor’s degree are steadily increasing.  These increasing tuition costs are quickly offset with the decreasing opportunity cost of attending college, which is driven from the falling wages of high school graduates.  It can be concluded that the value of obtaining a bachelor’s degree is not declining yet.  If the potential earnings continue to fall and the tuition costs continue to rise eventually the value will start to quickly decline (Abel).  

Determining the value of a college education goes into great depth.  The value is determined by the major a student may choose, the cost of college, the scarcity of degrees in the job market, the opportunity cost of college, and many other factors.  The most valuable degree a college student can choose is a petroleum engineering degree and the numbers back up that value with great strength.  The least valuable major a student can choose is a counseling psychology degree and the numbers prove that value.  Even if a student were to obtain a degree in counseling psychology they would more likely be better off than a student who only has a high school diploma.  No matter what degree a student chooses they still posses more skills then that of a high school graduate and this alone puts them on a higher pedestal. 
