Wednesday, September 22, 2010

Riding recessions with a college degree

The safest way to ensure economic stability is to earn a college degree. That's what we have been hearing since a very young age. Data released by the Department of Labor solidifies this point. I also came across a very interesting article in the Wall Street Journal detailing the trends and data.

It's not only that the college educated earn more over their lives, a staggering $1 million more on average, as compared with folks who do not hold college degrees, but that they are far more likely to keep their jobs.

The gap widens even further in times of recession. Not only in terms of amount of income, but also in the unemployment rate. The unemployment rate for workers 25-and-older with a bachelor's degree or higher was 4.6% in August 2010, for example, compared with 10.3% for those with just a high-school diploma. That's a huge 5.7-percentage-point gap. This is more than twice the gap that was seen during pre-recession times in 2007.

Laid-off college graduates are also finding work faster. Their median duration of unemployment was 18.4 weeks as of August, compared with 27.5 weeks for high-school grads. Three years ago, that figure was roughly the same for both groups—9.5 weeks and 9.6, respectively. And among the worst-off 25-and-older workers, the 5.2 million who have been out of work six months or more, only 19% are those who graduated from college, even though that group makes up a third of the work force.

All these statistics drive home the fact that ultimately, the safest way to survive and sail through a recessionary era is to invest time, money and heart towards a solid college education. It not only will ensure a stable job, but also help in case you end up having the misfortune of losing one.

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