Is It Worth It? Postsecondary Education and Labor Market Outcomes for the Disadvantaged

Ben Backes, Harry Holzer, and Erin Dunlop Velez

For young people growing up in disadvantaged families, obtaining a college degree is the surest way to achieve upward mobility for themselves and their families. Yet, in spite of these incentives, young economically disadvantaged students lag substantially behind their middle- and upper-income counterparts in achieving postsecondary credentials, and minorities continue to lag behind white students. While rates of college enrollment have risen for all groups in recent years, college completion rates, especially among minorities and the disadvantaged, remain low, and gaps in postsecondary attainment between income groups in the U.S. have grown in recent decades.

This paper examines a range of postsecondary education and labor market outcomes, with a particular focus on minorities and/or disadvantaged workers. Findings include the following:

  1. Gaps in secondary school achievement can account for a large portion of the variation in postsecondary attainment and labor market outcomes between the disadvantaged and other students, but meaningful gaps also exist within achievement groups.
  2. Earnings of the disadvantaged are hurt by low completion rates in postsecondary programs, poor performance during college, and not choosing high-earning fields.

Infographic: Who Completes College?

Principal Economist
Harry Holzer
AIR Scholar