In a commencement address at the University of Baltimore on Monday, Federal Reserve Chair Janet Yellen told graduates that they were entering the strongest job market in nearly ten years, but that technology and globalization were making it more essential than ever to complete college and pursue graduate education in order to compete, the Baltimore Sun reports:
“Economists are not certain about many things. But we are quite certain that a college diploma or an advanced degree is a key to economic success,” Yellen said in remarks at the commencement[.] … People with a college degree are more likely to find a job, keep it and earn a higher salary, she said.
Yellen said the increasing demand for people with college and graduate degrees reflected the need for higher technological skills and the impact of globalization, which allows goods and services to be produced anywhere. She said those trends are likely to continue. …
Yellen also noted the widening wage gap between workers with college degrees and those with a high school diploma. Annual earnings for college graduates last year were on average 70 percent higher than those with only a high school diploma. In 1980, that difference was only 20 percent, she said.
Yellen’s comments concur with several recent reports on the entry-level job market showing that recent college graduates enjoyed the best job prospects and starting salaries since the Great Recession, though at least one analysis has warned that too many graduates are underemployed, working in roles that don’t require a degree.
On the other hand, the proportion of jobs that do demand a college education has increased substantially, with employers requiring college degrees for many positions that once were open to high school graduates—and this is as true among small businesses as among larger firms. Employers are also demanding more candidates with liberal arts educations as soft skills become increasingly valuable.
While growing numbers of college graduates have fueled economic growth in the US for decades, Harvard economist Dale Jorgensen believes college is no longer the driver of growth it once was, and in contrast to Yellen’s advice, argues that the bulk of job growth in the coming years will benefit less educated workers.