Higher education can be expensive, and you might wonder whether pursuing a master's degree will be worth the expense, especially if you are relying on loans to fund your education. According to a Bureau of Labor Statistics, individuals with a master's degree make more money in their lifetime and have lowered risk of unemployment. Although the data shows that master's degrees are generally worth the investment financially, you should consider your own interests and make sure that the degree you ultimately earn is in something that you will be able to use toward your career.
Earning Potential
A study conducted by the U.S. Census from 1998 to 2000 shows that workers with a master's degree can expect to earn over $2.5 million during their working life. This is more than double the earning potential of a high school graduate, who can expect to earn $1.2 million. Those with bachelor's degrees collect approximately $2.1 million during their working life, whereas those with a professional degree can make around $4.4 million. Statistics from 2009 from the Bureau of Labor Statistics 2009 show that individuals with a masters degree earned an average of $1,257 per week. This is much greater than the median weekly earnings for all workers, at $774 per week.
The Impact of Demographics on Earning Potential
Research from the U.S. Census shows that demographics has a big impact on earning potential. White (non-Hispanic) workers earned more on average than black and Hispanic workers, regardless of educational attainment. The same research noted that while Asian and Pacific islanders could expect to earn less than whites at most educational levels, the earning potential of both groups was the same among workers who had received a master's or other graduate degree.
Degree Type
The annual earnings for people with master's degrees varies widely depending on the subject studied. PayScale data from January, 2011, indicates that the average annual salary of individuals with master's degrees in social work or teaching professions is less than half the annual earnings of individuals with master's degrees in fields such as engineering and computer programming or development. This finding is not surprising given the traditionally low salary levels in teaching and social work.
Potential for Unemployment
Obtaining a master's degree significantly reduces an individual's likelihood of becoming unemployed. Data from the Bureau of Labor Statistics indicates that the average unemployment rate for all workers was 7.9 percent in 2009. Individuals who did not achieve a high school diploma experienced an average unemployment rate of 14.6 percent for that year. The unemployment rate among those with master's degrees, on the other hand, was 3.9 percent, significantly less than those with bachelor's degrees (5.2 percent), but slightly higher than those with a professional degree (2.3 percent).
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