The Returns to Education in the Sub-Baccalaureate Labor Market, 1984-1990

W. N. Grubb

While the sub-baccalaureate labor market is large and growing, there has been relatively little analysis of its effects on employment. This paper adds to our knowledge by analyzing the Survey of Income and Program Participation for the years 1984, 1987, and 1990. The benefits of sub-baccalaureate credentials-associate degrees and credentials-are generally positive and statistically significant, contrary to the critics of two-year institutions. However, the benefits of completing some postsecondary education but failing to earn credentials are much lower, especially for women; there are substantial variations in returns among fields of study; and individuals who do not find employment related to their field of study also have lower returns. The implications are that better information should be provided to students so they can make rational choices, and state and federal policy should emphasize practices to improve completion rates and placement rates in both two- and four-year institutions. This article is reprinted from the 1997 issue of Economics of Education Review.

MDS-1235 / October 1998

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