Adolescent Disadvantage and the Economic Value of College Degree Attainment

Background and Purpose: In 2019, roughly 5.1 million (21%) adolescents, ages 12 to 17, lived in poverty (National Center for Children in Poverty, 2021). However, the COVID-19 pandemic has contributed to rising rates of poverty (Shrider et al., 2021) and significantly widened socioeconomic inequities, particularly among historically disadvantaged groups (Perry et al., 2021). Although students’ background socioeconomic status is a key determinant of their future income (Reardon, 2011), college degree attainment is commonly considered to be a pathway for upward social mobility. Individuals with higher levels of education generally have higher wages (Day & Newburger, 2002). However, some research suggests that college degree attainment benefits those from higher family income backgrounds but not those in the bottom quintile (Pew, 2012). This study aims to better understand the relationship between adolescent disadvantage and the benefit of college degree attainment in terms of immediate wage increases and wage growth over time.

Methods: Data were from the Maryland Longitudinal Data System (MLDS), Maryland’s statewide repository for individual-level education and workforce data that are longitudinally linked across state agencies. Our cohort consists of all students in 6th grade in 2007-2008 who did not transfer out of Maryland public schools, went on to graduate from high school, and had at least one quarter of post-high school wage data (n=33,460). The analytic sample is 51% female; 35% Black, 65% non-Black; and 48% economically disadvantaged, measured using eligibility for free/reduced price meals. This study used multilevel repeated measure or growth curve modeling, which estimates individuals’ initial wages and their estimated growth for each increment of time thereafter.

Results: Overall, attainment of an associate’s degree was associated with an immediate 15% boost in wages but a decrease in wage growth over time compared to similar individuals who did not enroll in college, while the attainment of a bachelor’s degree was associated with an additional immediate 34% boost in wages and an increase in wage growth over time. However, wage trajectories varied by race. Upon attaining a bachelor’s degree, Black individuals had an immediate boost in wages that was 15% larger than the boost for similar White individuals, but their subsequent growth was 8% lower. Wage trajectories also varied by gender. Upon attaining a bachelor’s degree, females had an immediate boost in wages that was 13% larger than similar males, and a 6% greater increase over time. Finally, post-college degree wage trajectories did not vary by experiences with disadvantage. High school graduates who had experienced disadvantage saw similar boosts and growth in wages upon attainment of associate’s and bachelor’s degrees, compared to similar students who had not experienced disadvantage.

Conclusions and Implications: When examining the population as a whole, both associate’s and bachelor’s degrees were associated with significant immediate boosts to wages, with bachelor’s degrees also related to subsequent growth in wages over time. However, relationships varied by race and gender; experience with disadvantage was not associated with differences in post-degree wage trajectories. A discussion highlighting educational and workforce policies and interventions to help ameliorate social inequities will follow.