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Educational Wage Gap

Educational wage gap should be a matter of public policy concern. It quite clear that individuals with college degrees are productive compared to those who have not gone beyond high school (Görlitz, 2011). The variation in the wages has been polarized with the rising technological advances. The increasing reliance on computer technologies makes it easy for those who have gone beyond high school to apply for technical jobs that require advanced skills. The educational wage differential is a trend which has been witnessed in the US labor market in the last three decades. This trend is a matter of public concern that has made several people acquire degree and a post-graduate degree to allow them to earn high wages.

The United States labor market favors individuals who hold a graduate degree (Konings, Jozef, and Stijn, Educational Wage Gap2015). Such individuals have the requisite skills that match the current technologies employed in the workplace. Therefore, higher education enables workers to receive high earnings and generous benefits. As such, they gain greater autonomy and stability. A post-graduate degree is an important aspect that determines wage differentials in the US labor market. Most workers consider a post-graduate degree a vital financial investment since they are assured of high wages in the labor market. The growing gap experienced between college degree holders and post-graduates have had several implications in the wage structure of the United States (Görlitz, 2011).  This has been attributed to the emerging technologies which require people with advanced skills to use computers. The post-graduate workers also have a direct advantage in the job market. This is because their skills complement the evolving or emerging technologies and the job content. The educational wage gap has resulted in underemployment of the undergraduates. Most of them have been involved in jobs that do not require college degrees.

Therefore, the issue of educational wage gap should be addressed by developing clear job profiles and content. The workers should be made aware of the wages they are expected to earn depending on their levels of education. This should be made clear in the US wage structure. Besides, the wage structure should be designed to allow employees who perform technical jobs to earn higher wages irrespective of their level of education. This will help to reduce the wage disparities witnessed in the workplace.

  • Görlitz, Katja. “Continuous training and wages: An empirical analysis using a comparison-group approach.” Economics of education review 30.4 (2011): 691-701.
  • Konings, Jozef, and Stijn Vanormelingen. “The impact of training on productivity and wages: firm-level evidence.” Review of Economics and Statistics 97.2 (2015): 485-497

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