Grad school has its benefits. People with advanced degrees tend to earn bigger paychecks than those who have only an undergraduate degree. They’re also more likely to land a job — and less likely to end up on their parents’ couch.
But those perks come at a cost. For some it might mean temporarily giving up a paycheck, something they’ve gotten used to in the working world. And graduate students, who often reach this next milestone without the help of mom and dad, account for about 40 percent of the $1 trillion in outstanding student loan debt, according to the New America Foundation.
Ideally, people will come out with the potential to earn a much bigger paycheck and to reach a point in their careers that wouldn’t have been possible without the advanced degree. The jobless rate for people with master’s degrees was 3.4 percent in 2013, compared to 4 percent for people with a bachelor’s, according the Bureau of Labor Statistics. Median annual earnings were $69,100 for people with master’s degrees and $57,600 for those with a bachelor’s. But the payoff varies.
“The general conclusion about graduate degrees is that they do improve earnings,” says Anthony Carnevale, director of the Georgetown University Center on Education and the Workforce. “There’s almost no doubt about that.”
Still, he points out: “That doesn’t mean there aren’t some turkeys in the mix.”
Indeed, outcomes vary by major. Working as an engineer? Getting a graduate degree will probably lead to a big raise. For a journalist, not so much.
Communications majors don’t see any change in pay, on average, after getting a master’s degree. But income doubles after that person gets a PhD. Engineers, on the other hand, see a steady bump with every degree.
In the end, a person’s pay will depend on the demand for that job, the level of difficulty of the degree and whether a master’s is needed to advance in the