Stability of Employment With High School Diploma vs Undergrad Degree vs Grad Degree Research Paper

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Stability of Employment

Education has long been associated with earnings potential. As a person completes higher levels of education, it makes sense that their level of pay also increases. One issue with this trend is that some jobs do not require the higher levels of education because the tasks required do not warrant it. There is also the class structure that it puts in place with intelligence rather than wealth being the commodity that decides at what rank a person should be. The crux of this study is to determine how much education matter for the earnings potential of a small isolated group of individuals. The researcher wondered how much an undergraduate college degree mattered, and whether achieving an advanced degree was worth the added expense. A group of 27 participants answered a survey regarding these questions. The study found that level of education mattered to a great degree and cost of education did not matter to the person attaining the degree because it afforded them a better life style. This was seen as an investment.

Table of Contents

Abstract 1

Table of Contents 2

Statement of Problem 3

Background 3

Rationale 4

Literature Review 5

Methodology 10

Results 11

Conclusion 12

References 16

Appendix A: Chart of Weekly Average Pay by Level of Education 18

Appendix B: Questionnaire 19

Appendix C: Statistical Printout 20

Stability of Employment with High School Diploma vs.

An Undergrad Degree and vs. A Grad Degree

Statement of the Problem


Many problems exist in the United States which are presently under review, but none eclipse the current job market and what individuals feel the present level of incompetence is at the federal and state governmental levels. Due to the extent of the 2008/2009 financial collapse, many people lost their jobs as the initial causes for the crash snowballed into every sector. It can easily be gleaned from the extant information that the housing market crumbled first due to poor regulation of loans and loan speculation, which caused Wall Street firms to buckle. The reason that this happened was because investors were making poor decisions concerning large funds that were financed by inflated loan values. The crisis began hitting other sectors of the economy when banks began calling loans and people began defaulting on them, and the "housing bubble" began collapsing under its own weight. People started to lose jobs because financing became scarce and companies were worried that they would lose money. One of the methods used to ensure solvency is to lay off, terminate or cause workers to except early retirements and this is what happened. Thus, the jobless market expanded, and when many of these people were able to find work it was for less money than their previous employment. The term "underemployment" became a phrase that many are now familiar with.

Of course this is only one of many explanations for a complicated issue, but the fact that many employees were underemployed became a concern. Many of these people had gained college degrees and then experience with a particular company or industry, and they had seen this go for naught when the company or industry found that too many people were employed to sustain the businesses. Also, this meant that white collar workers found themselves unemployed at a higher rate than normal. The reason for this is that white collar workers generally earn higher wages, so they were cut first when the crisis began. However, when the most difficult days of the crisis had ended in 2009, it was found that "the disparity between white-collar and blue-collar unemployment [was] stunning: 4.5% among college graduates versus 10.8% for those with a high-school diploma, and 14.3% for those without one" (Gold, 2010). This level of disparity between levels of education had not been present previously, even though there has always been some level of difference, and this became a worrisome trend.

The disparity between levels of education has become a larger problem in the United States, as have many of the income inequalities, and there seems to be few solutions that are workable. It is understandable that a person who earned a college degree in a field will start at a higher wage, but, at some point, if two people with different levels of education have the same job, they should equal out over time. This does not seem to be the case. As far as this study is concerned, it must be noted that the question is not whether a person with a higher level of education should make more money or not, but whether they do. So, the problem is that a disparity exists and it is necessary to determine, in a small local sphere, how great that disparity is.


The disparity of income according to level of education is well documented, but it was necessary to determine how that affected local communities. Taking a small sample size and averaging the income level over this population to determine if it meets national levels or not is the reason for this particular study. Since this is a random sample of a typical suburban area, it should either equal or come close to the national sample. If the disparity is seen in this area, then programs can be put in place that will best solve the issue for this area.

Literature Review

For this literature review and further study, people with a high school degree, undergraduate degree (bachelor's and associates) and graduate degree (master's or doctorate) are considered. The review takes a relatively comprehensive view of the material discussing income disparities at all of these levels.

There has always been a profound difference between people who have attained a college education and those who have not. In past centuries when many people stopped their education after grade school or with some high school and then went to work when they were deemed old enough, college was reserved for the wealthy and the otherwise privileged (Kennedy & Vaughn, 2004). Youth and young adults who came from families that either had agrarian or artisan level jobs were likely going to follow in the same profession. There was much less movement between professions than there is now, and there was almost no assistance, government or otherwise, for students to procure a higher education.

This fact has changed as more people are now able to receive a degree, and the number of degree available has increased dramatically over the past several decades. Mastracci (2004) found that "Although the proportion of the population earning a 4-year college degree has increased over time, nearly three-fourths of the nation's population never earns one. Over one-fourth of the population never enrolls in formal schooling again after obtaining a high school diploma." Thus, even though higher education is more available to the entire population than it ever was, many opt out of completing their degree even if they, at some point began to get one. The reasons for this are as myriad as the number of people entering the labor force, but it is not understood, by much of the population why the degrees are needed in the first place.

Although it is true that advanced degrees and years of schooling are needed for some professions (doctors, engineers, etc.), there is no need for a degree in many that now require one. A researcher made this same point when she found that "many occupations essential to the economy do not require a 4-year degree, including many service-sector jobs and skilled trades" (Mastracci, 2003). Therefore, it would seem that the inflation in the need for education is false to begin with which means that there is no need for a wage disparity, in many professions, between people who have earned a college degree and those who have not. Unfortunately, it does exist.

Researchers have found, for a matter of fact that there exists a startling disparity between workers who have earned an undergraduate degree or higher and a person who has not. According to the chart in Appendix A, after an adjustment for inflation the real disparity is $450 a week between people with a college degree and those who have a high school degree and no college (Strachan, 2011). These are 2006 figures, but there is an even greater degree of separation currently. Wheeler (2005) found the same issue pre-2006 that Strachan found several years later, but another researcher noted that "over a work-life, individuals with a bachelor's degree working full time, year round, earn about one-third more than individuals who do not finish college and earn almost twice as much as individuals with a high school diploma" (Aughinbaugh, 2008). The data that proves the disparity is apparent to the weakest observer, but the cause is what has been debated so vigorously.

The two primary positions in the discussion are reserved for those who are looking at "between-sector dispersion" in the same industry (Wheeler, 2005), and those who see it as a technology gap that affects all industries due to the…[continue]

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