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The Undereducated American

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The United States has been under producing college-educated workers for 30 years, and is paying for it with increased income inequality.

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The Undereducated American

  1. 1. The Undereducated American By: Anthony P. Carnevale and Stephen J. Rose June 26, 2011
  2. 2. Overview •  Over the past 30 years, the demand for college- educated workers has outpaced supply, resulting in economic output below potential and growing income inequality. •  The current recession and grudging recovery hide the fact that we are underproducing college graduates. •  The demand for college-educated workers is growing much faster than the supply.
  3. 3. Attainment of college degrees, 25-34 year olds in OECD countries Source: OECD, Education at a Glance (2010)
  4. 4. Demand for college-educated workers •  In order to meet increasing technological demands and to reduce income inequality, the U.S. needs an additional 20 million college-educated workers by 2025: –  15 million new Bachelor’s degree holders –  4 million workers with non-degree postsecondary credentials –  1 million workers with an Associate’s degree •  Meeting this goal will result in a labor force in which 52 percent of workers will have a B.A., A.A., or graduate degree, and another 25 percent have some college but no degree.
  5. 5. Wage increases •  Wages for all groups will rise: wages for those with a high school diploma will rise 24 percent; wages for those with an Associate’s degree will rise by 15 percent; and wages for Bachelor’s educated workers will rise by 6 percent.
  6. 6. Change in earnings by attainment level Source: Georgetown University Center on Education and the Workforce calculations from the statistical framework presented in Autor, Katz, and Kearney (2008) "Trends in U.S. Wage Inequality: Revising the Revisionists," The Review of Economics and Statistics.
  7. 7. Conclusion •  Increasing the number of people in the workforce with postsecondary credentials to 20 million has many benefits: –  It creates a more competitive economy and more equitable prosperity –  It boosts GDP by $500 billion and adds over $100 billion in additional tax revenues –  It helps achieve the President’s goal of being number one in the world in terms of degree attainment among the workforce.
  8. 8. For more information: See the full report at: cew.georgetown.edu/undereducated   Email Us | cewgeorgetown@georgetown.edu Follow Us on Twitter | @GeorgetownCEW Find Us on Facebook | Facebook.com/GeorgetownCEW Follow Us on LinkedIn | linkedin.com/company/georgetowncew

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