With Utah’s colleges and universities just weeks from starting classes, the state’s institutions of higher education have solidified their plans — at least for now — to maximize learning and minimize the spread of the coronavirus on campus. Yet, colleges aren’t the only ones who have to make tough decisions; students do too.
Students have to consider whether they will feel safe attending in person, and if they don’t, whether it’s worth paying tuition without the typical social opportunities that the on-campus experience brings. Moreover, they have to weigh the pros and cons of “remote learning” — which all of Utah’s major universities will be employing to some degree.
With deadlines looming, about one-third of recent high school graduates nationwide have expressed serious reservations, indicating that they may defer or cancel their college attendance this fall.
Since workers with more education, on average, strongly out-earn those with less, these choices will have implications for students’ careers — and for Utah’s economy — for years to come. Yet what is true on average can sometimes mask underlying differences. Besides the benefit, on average, to more education, it’s also true that where you live can affect how much you earn, as local labor markets, the cost of living and the cost of college all play a part.
It turns out that’s particularly true in the Beehive State. A recent study published by my organization examined differences in earnings for workers in all 50 states, in over 100 large cities, as well as in rural areas of the seven large regions in the U.S. It found that workers with two-year associate degrees came much closer to closing the pay-gap with four-year college graduates in some parts of the country than in others. But Utah and its two largest metro areas fall substantially below the national averages relative to earnings for college-educated workers.
Authored by economist John Winters, “What You Make Depends on Where You Live” looks first at national earnings. It finds that, on average, workers in the U.S. earn 55 percent more than those with just associate degrees and 85 percent more than workers with just high school diplomas. But these education “premiums” are markedly lower in Utah. On average, Utahns with bachelor’s degrees earn just 44 percent more than those with associate degrees ($88,860 versus $61,746 for full-time, full-year workers) and 69 percent more than those with high school diplomas.
What’s more, college-educated workers in Utah’s two largest Metropolitan Statistical Areas — Salt Lake City and Ogden — see particularly low returns to education. In the Salt Lake City area, college educated workers earn, on average, $87,218, less than the national average of $92,608, while associate degree holders earn $65,541, considerably greater than the national average of $59,707 for these workers. Ogden’s workers have a similar — though less extreme — pattern, with associate holders earning $61,942 and workers with bachelor’s degrees earning an average of $87,460.
In the rural areas of the Rocky Mountain region, additional earnings associated with more education are even lower, in part because this region has the highest pay for high school educated students in the country. Like other areas throughout the western regions of the country, rural Utah and its cities offer plentiful jobs in oil, gas, and mining industries, often with strong salaries for non-college educated workers.
Of course, these lower-than-average premiums from a college degree don’t mean that young people shouldn’t invest in more education and training, and our report found that tuition at Utah’s colleges is particularly affordable. Much depends on whether students desire the traditional college experience or a white collar job, as well as what major or program they choose and, frankly, whether they work hard and take advantage of the opportunities that their institution provides.
But it does mean that earning a traditional four-year college degree — especially in some parts of Utah — makes less sense than it does in other parts of the country.
Clearly, information on earnings differences between two- and four-year degrees matter so that students can make more knowledgeable decisions about their future.
So what should we be saying to young people today about these pending decisions? Surely we should encourage them to study hard and take advantage of the resources in whatever program they enter, whether it leads to a two-year degree, a technical certificate or a bachelor’s degree. We might also ask them not only what they want to be when they grow up, but where they want to live.
In the end, high schoolers must take geography into account when they make decisions about what kind of higher education or post-secondary training to pursue.
Michael J. Petrilli
Michael J. Petrilli is president of the Thomas B. Fordham Institute.