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Financial Impact of Educational Attainment by Race/Ethnicity

ByBlake Decker

in our previous blog post, we began a multi-part series looking at estimated lifetime earnings to see general trends across the spectrum of education levels ranging from “less than high school diploma” to “professional degrees.” Overall, data from the Center on Education and the Workforce (CEW) at Georgetown University showed that bachelor’s graduates earn approximately $1.1 million more than high school graduates ($2.8M vs $1.7M) over the course of a lifetime. This post continues this series by reviewing median lifetime earnings disaggregated by race/ethnicity categories, as all estimated earnings are for Americans only.

Tab 1: Median Lifetime Earnings

  • The first visualization below shows a line chart that represents estimated lifetime earnings by five race/ethnicity categories for Americans: Asian, Black, Hispanic, White, or Other. The last group includes people groups such as American Indian/Alaska Native, Native Hawaiian, and more than one race.
  • With just a high school diploma, lifetime earnings range from a median of $1.36 million for both Asian and Black adults to $1.69 million for white adults. Tracing the lowest earnings line across the graph shows that Black adults earn the least at each increase in educational attainment until surpassing Hispanic adults at the professional degree level.
  • On the upper-end of the distribution, white adults earn slightly more than Asian adults until the master’s degree level, when Asian adults jump to almost $4M in median lifetime earnings. 
  • The largest percentage difference between highest and lowest median lifetime earnings is at the master’s and professional degree levels, where Asian graduates ($3.98M) earn 47% more than Black graduates ($2.71M) with master’s degrees, and 47% more than Hispanic graduates ($5.27M vs $3.58M) with professional degrees.
Note: Hovering over data points shows tooltips with additional information. Click the tab headings to move between visualizations.
Tab 2: Increase from HS/GED to Bachelor’s Degree
  • In the second visualization above, we see the percentage increase in median lifetime earnings by race/ethnicity group when looking at the difference between the two education levels: HS diploma and bachelor’s degree. 
  • Asian adults experience an estimated 114% increase from a median of $1.4M for a HS diploma to $2.9M for a bachelor’s degree, while lifetime earnings for white adults increase by 74% ($1.7M for HS diploma versus $2.9M for a bachelor’s degree). 
  • Black adults (67%, $1.36M for HS diploma versus $2.27M for bachelor’s degree) and Hispanic adults (66%, $1.39M for HS diploma versus $2.31M for bachelor’s degree) are essentially equal to the estimated overall percentage increase when comparing lifetime earnings for HS graduates versus bachelor’s degree-holders.

So What?

As seen previously in the CEW’s data on overall lifetime earnings, increases in educational attainment improve financial outcomes for all individuals. However, as we can see in the data above, the degree to which those increases occur can differ across race/ethnicity groups. Of particular interest is the widening gap between highest and lowest earnings as educational attainment levels increase. Below a bachelor’s degree level, the gap is approximately 23% for each educational level, while the gap is 29% for bachelor’s degrees, 47% for master’s degrees, 26% for doctoral degrees, and 47% for professional degrees. The task for policymakers, as well as education and business leaders, is to wrestle with the key drivers responsible for the phenomena observed in these data. We will continue exploring other ways in which lifetime earnings may differ based on other variables and characteristics in future blog posts in this series.