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ERIC Number: ED559317
Record Type: Non-Journal
Publication Date: 2014-Apr
Pages: 17
Abstractor: ERIC
Educational Attainment and Earnings Inequality among US-Born Men: A Lifetime Perspective
Mitchell, Josh
Urban Institute
Since the onset of the Great Recession over six years ago, restoring full employment has been the most urgent labor market priority. As the economy slowly recovers, long-term labor market challenges will receive renewed attention. Among the most significant is the growing earnings divide between different types of workers and the potential role of education in providing greater economic security. This report takes advantage of a novel dataset, which tracks individuals over time, to better understand the historical relationship between education and earnings. Using survey data linked to longitudinal administrative earnings records, the authors follow a large, representative sample of men born in the United States between 1940 and 1974 over the course of their careers. They examine how earnings inequality for these men has evolved over time with a particular emphasis on earnings differences by level of educational attainment, age, and year of birth. The authors also compare inequality as measured on an annual and lifetime basis. Lifetime earnings measures may be a better indicator of wellbeing in the long-run. They are also relevant for policy discussions surrounding the value of promoting higher education. The analysis yields several important findings: (1) When you are born matters; (2) The trajectory of earnings inequality has shifted; (3) The increase in earnings inequality reflects both absolute gains for highly-educated workers and absolute losses for lower-educated workers; (4) The biggest winners are those with advanced degrees; (5) Across cohorts, there is virtually no change in earnings for those with some college but less than a four-year degree; (6) Across cohorts, lifetime earnings inequality has increased more than annual earnings inequality; (7) Earnings inequality experiences also changed greatly "within" education groups; and (8) Given the growth in both within-group and between-group inequality, it remains unclear how advantageous it would be for more men to attend college. This report proceeds as follows. In the Data section, the authors summarize the data used in this report. In the following section, they describe patterns of annual earnings inequality across education groups. The authors then report analogous results for cumulative earnings inequality, followed by analysis of within-group inequality. They then discuss calculations of the lifetime value of a college degree before concluding. A Data Appendix is included.
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Publication Type: Numerical/Quantitative Data; Reports - Research
Education Level: Higher Education; Postsecondary Education; High Schools; Secondary Education
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: Urban Institute