What Effect Does Education Have on Salary Range?

effect-education-salary-range Credit: Shilad Sen/CC-BY 2.0

Education has a significant influence on potential income. In the general U.S. population, higher levels of education correlate with increased levels of income, decreased unemployment rates and lower rates of poverty.

In 2014, the median U.S. worker earned approximately $43,600 annually. People without high school diplomas only earned $25,400 annually, while workers with a high school diploma or GED earned $34,700 annually. Workers with associate's degrees earned $41,180 annually. The completion of a four-year degree correlates with a large spike in potential income; the median annual income for workers with bachelor's degrees was $57,250. Workers with master's degrees have even higher income levels of $68,900 per year, and the median income for holders of professional degrees and doctoral degrees was $85,230 and $82,730, respectively.

In addition, higher levels of education correspond to reduced levels of unemployment. The U.S. unemployment rate in 2014 was 5 percent, but the unemployment rate among people who did not complete high school was 9 percent. In contrast, worker's with associate's degrees have an unemployment rate of 4.5 percent, and holding a bachelor's, master's, professional, or doctoral degree correlates with even lower rates of unemployment. Moreover, 21.8 percent of workers with high school degrees live at or below the poverty line. In contrast, the poverty rate for workers with at least a bachelor's degree is just 5.8 percent.