Salary Survey Extra: The salary oomph of formal education
Salary Survey Extra is a series of periodic dispatches that give added insight into the findings of our most recent Salary Survey. These posts contain previously unpublished Salary Survey data.
A popular topic in the run-up to the 2020 presidential election in the United States has so far been the problem, weighing heavily against the potential prosperity of many, of crippling amounts of student loan debt. It costs a lot of money to get a college education, and almost nobody has the means to pay for it out-of-pocket.
It’s also gone almost without saying, for many years, that a college education is an essential prerequisite to successful and comfortable adult living. Hence, just like many of today’s adults learned from their parents that a home mortgage is an acceptable form of debt, most people view a college education as being something worth borrowing money to finance.
And yet, in the tech industry, as in many other industries, it’s not critical to attend college before entering the workforce. It’s certainly valuable, but it’s not the only way to learn about computers and information technology (IT).
There are quite a number of specialized schools and other programs — including certification programs — that teach IT skills. Many cost considerably less than getting a four-year (or even a two-year) college degree. Some are even free.
There are, of course, numerous intangible benefits of pursuing formal education to its uppermost echelons. And probably almost everyone who embarks down that road has loftier aims than to just increase the likelihood of a hefty eventual salary.
It’s worth at least looking at the state of things, however, to take a guess at whether money spent on IT education equates to money earned in the IT workplace. We asked Salary Survey respondents to identify the highest level of formal education they’ve completed. The breakdown, with U.S. respondents separated from those chiming in from other nations, is as follows:
United States — What is the highest level of formal education you have completed?
Bachelor’s degree: 39.6 percent
Master’s degree: 22.7 percent
Two-year college degree: 12.9 percent
Technical training (no college degree): 10.6 percent
Currently in school: 6.2 percent
High school diploma: 5.2 percent
Doctorate: 1.9 percent
Professional degree (such as for law or medicine): 0.8 percent
No formal education prior to entering the workforce: 0.1 percent
All Non-U.S. Countries — What is the highest level of formal education you have completed?
Bachelor’s degree: 43.8 percent
Master’s degree: 30.2 percent
High school diploma: 7.1 percent
Technical training (no college degree): 6.4 percent
Professional degree (such as for law or medicine): 5.4 percent
Two-year college degree: 5.1 percent
Doctorate: 1.4 percent
Currently in school: 0.3 percent
No formal education prior to entering the workforce: 0.3 percent
We’ve chosen not to consider the salary data from groups smaller than two percent of their respective survey populations. That leaves us with the following:
AVERAGE ANNUAL SALARY INDEXED BY HIGHEST LEVEL OF FORMAL EDUCATION
|UNITED STATES||ALL OTHER COUNTRIES|
|Highest Level of Education||Salary||Highest Level of Education||Salary|
|Bachelor’s degree||$104,620||Bachelor’s degree||$47,390|
|Master’s degree||$120,440||Master’s degree||$55,780|
|Two-year college degree||$80,170||Two-year college degree||$60,440|
|Technical training||$98,170||Technical training||$59,480|
|High school diploma||$92,070||High school diploma||$46,480|
|Currently in school||$70,800||Professional degree||$38,120|
|Insufficient data: Doctorate, professional degree, no formal education prior to entering the workforce||Insufficient data: Doctorate, currently in school, no formal education prior to entering the workforce|
2020 Salary Data
It would seem clear that you don’t have to attend a college or university to make your way in the IT realm. The sample size is small, but U.S. IT workers whose furthest foray into higher education was either completing high school or completing technical training (typically one or more certifications) are doing just fine for themselves.
Outside the United States, the best educational value available, at least in terms of future earning potential, would appear to be either a two-year college degree or post-high school technical training. And though nearly 75 percent of non-U.S. IT workers who participated in the survey have either bachelor’s or master’s degree, there’s no clear indication that those pristine academic credentials provide assurance of earning power.
In the United States, on the other hand, it seems clear that advanced degrees do lead to substantially higher incomes. While the average annual salary of a U.S. bachelor’s degree holder is only marginally more impressive than that claimed by the admittedly smaller class of survey respondents who completed some form of post-high school technical training, holding a master’s degree is a status clearly preferred (and compensated accordingly) by U.S. employers.