College pays off, according to new research

An analysis of the incomes of 5.8 million Americans found that completing a college degree is a good investment, according a study published in the American Educational Research Journal.

The study used U.S. Census data to compare the earnings of college graduates to people who had only finished high school, as well as the costs of college, and found that a college degree earned a rate of return on investment of 9-10% annually throughout a person’s career.

The findings come as skepticism about the value of a college degree grows amid rising college costs, a decline in college enrollment  and a changing economy, according to a news release from the American Educational Research Association.

“Our cost-benefit analysis finds that, on average, a college degree offers better returns than the stock market,” said study co-author Liang Zhang, a professor at New York University. “However, there are significant differences across college majors, and the return is higher for women than men.”

Women do not have higher overall earnings then men; rather, the gap between the pay of high school graduates and college graduates is greater for women than men.

Engineering and computer science majors had the highest median returns, exceeding 13%, followed by business, health, and math and science majors, with returns ranging from 10-13%, according to the study.