In the discussion of which demographic factors influence one's lifetime earnings, there are always the usual suspects: race, ethnicity, English-speaking ability, gender, geographic location, and of course, education. A new report (PDF) out today from the U.S. Census, in fact, confirms that each of the preceding factors plays a role in determining income.
That's not surprising. But what may surprise the lay observer is how much more influential one of those factors--education--is than the others. The earning gap between the two extremes in level of education--those who attended only elementary school and those with professional degrees--is approximately $72,000, exhibiting five times the influence than the second most important determinant of income, gender. "Thus, from this simple evaluation of relative impact, it is clear that the demographic factors supplement, but do not displace education as a critical component in understanding variation in earnings," the report concludes. The chart below offers a snapshot of relative effects of education, gender, and race and ethnicity on income.
The findings from the Census Bureau provide some context for education system's supposed "boy problem." It's been know for years that women are outpacing men in earning college degrees--36 percent of 25- to 29-year-old women have bachelor's degrees, 8 percentage points higher than men, according to Pew. This is happening, in part, because college degrees are seen as more important for the career success of women than they are for men. More than three-fourths of American say that women need to go to college in order to succeed, while only 68 percent thought the same for men, the same Pew study found. While the wage gap between the genders persists--and while some groups, such as non-Hispanic white males and Asians of both genders, benefit more financially from education than other demographics--American women of all races know that they can close that gap by staying in school.