Typical young workers with college degrees now outearn their high-school-graduate counterparts by a record-high $22,000 per year.
According to new data from the Federal Reserve Bank of New York, the median annual wage for a full-time worker ages 22 to 27 with a high school diploma is $30,000. For a full-time worker with a bachelor's degree, it's $52,000.
The difference marks a pay gap of $22,000 — the highest on record with the New York Fed, which tracks earnings going back to 1990.
The findings are part of the new report on recent college graduates. The report also looks at unemployment, underemployment and wages for workers with different college majors.
In terms of median wages, every major analyzed by the New York Fed outearned the high school diploma. Of course, there are always exceptions, and some whose educations stopped after high school wind up making more money than college grads. A Georgetown University study found that 16% of workers with only a high school diploma earn more than half of workers with bachelor's degrees.
Overall, though, the return on investment for a college degree is substantial — worth upwards of $800,000 or more in increased earnings over a lifetime.
Perhaps unsurprisingly, the new report shows that some college majors — like those in the STEM fields — fare much better than others in terms of earnings. The difference in earnings among majors highlights a massive income gap of its own.
Highest-paying college majors
The New York Fed compiled data on earnings by major for recent grads and for mid-career grads. Recent grads are defined as 22 to 27 years old, and mid-career grads are between 35 and 45.
For both recent and mid-career grads, engineering majors dominate the top earning positions.
Highest-paying majors for recent grads:
- Computer engineering: $74,000
- Chemical engineering: $70,000
- Aerospace engineering: $70,000
- Electrical engineering: $70,000
- Computer science: $70,000
Unsurprisingly, the further along someone is in their career, the more they earn.
Highest-paying majors for mid-career grads:
- Chemical engineering: $111,000
- Computer engineering: $110,000
- Aerospace engineering: $110,000
- Electrical engineering: $107,000
- Mechanical engineering: $104,000
Lowest-paying college majors
On the other hand, college graduates with certain majors barely earn more than people with only a high school diploma. Here’s a look at the lowest-paying majors, according to the report. Liberal arts majors dominate this list.
Lowest-paying majors for recent grads:
- Family and consumer sciences: $32,000
- General social sciences: $34,000
- Performing arts: $34,000
- Social services: $35,000
- Anthropology: $36,000
Lowest-paying majors for mid-career grads:
- Early childhood education: $43,700
- Elementary education: $45,400
- Social services: $50,000
- General education: $50,000
- Family and consumer sciences: $51,000
Employment by college major
The Fed’s report also dives into the unemployment and underemployment rates. The underemployment rate shows which majors are likely to result in recent grads taking “non-college" jobs. The Fed defines the term as positions that generally do not require a college degree.
The majors with the lowest unemployment rates — and several are below 2% — highlight the subject areas that are currently in highest demand.
Here are the majors with lowest unemployment rates for recent grads:
- Medical technicians: 0.7%
- Early childhood education: 1.4%
- Construction services: 1.6%
- Elementary education: 1.7%
- Biochemistry 1.7%
Curiously, several majors with low unemployment rates are among the ones that pay the recent grads the least.
The majors with the highest underemployment rates for recent grads include:
- Criminal justice: 71.1%
- Performing arts: 70.2%
- Anthropology: 61.3%
- Leisure and hospitality: 59%
- Miscellaneous technology: 59%
Overall, median wages for early grads range from $32,000 to $74,000, for another income gap of $42,000. This pay-gap-by-major far exceeds the difference in earnings between college and high school grads.
The gap only widens over time: Mid-career bachelor’s degree holders earn between $43,700 and $111,000.
The $67,300 question then becomes not only will you go to college — but what major will you choose?
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