Is a master's degree still worth it?
Mar 23, 2023
It wasn’t so long ago that pursuing a master’s degree was considered an obvious choice for those who could afford it. Around the year 2010, master’s degrees had already become as common as bachelor’s degrees were in the 1960s, with virtually every field of study having experienced long-term consistent growth. But in the last decade, a confluence of factors has conspired to make us question the necessity of traditional education.
Prospective students today don’t just need to consider the typical financial return on their educational investment — they must also be mindful of the ever-accelerating changes in the job market, including the advent of artificial intelligence and an increasingly skills-based economy. To boot, alternative ways of working like freelancing and flexible work have added even more factors to an already complicated equation. So, it begs the question…
How do I begin to decide?
The Greeks had “know thyself” inscribed above the entrance to the temple of Apollo at Delphi. While that phrase might seem like an impossible injunction — especially for a young person who might have only recently started to ponder their future — setting aside some time for introspection is always a good idea, and something more people are doing today.
In the past, students were trapped in the mindset that “if I don’t go right away after undergrad, I’ll never go back,” says Moschell Coffey, adjunct assistant professor of public service at NYU.
Today, that mindset has shifted and students have become more careful. A master’s degree costs a lot of money and takes time. And someone who had a couple of years of working experience before continuing their higher education is in a better place to know what skills they want to develop and what career they want to pursue. “I say this myself as somebody who went to grad school right away after undergrad,” Coffey says.
While you shouldn’t expect your self-interrogation to result in a five-decade career plan, asking yourself about your interests and strengths can provide a general direction.There are also practical aspects that can set your course. For example, certain fields absolutely require you to pursue a master’s degree, such as becoming a licensed clinical psychologist, a nurse practitioner, or most positions within the United Nations. “You can’t get good jobs in the coaching or counseling field without a master’s degree,” says Anne Angerman, licensed clinical social worker and founder of Career Matters, a company providing career coaching, planning, and assessment tests for professionals to find their best career fit.
Of course, “knowing thyself” goes beyond your professional aspirations. Perhaps, the geographical location might feel equally important as your profession. In this case, investigating labor demand in a specific city can be a starting point; or maybe you prefer to work remotely — then that also narrows your scope.
So what about the money?
While a growing pool of (especially young) people are trying to better balance purpose with a paycheck, money nonetheless remains a necessary consideration for most. So will a master’s degree increase your earnings?
Generally speaking, yes. According to a study in 2022 by the National Center for Education Statistics, from 2010 to 2020, the median earnings of full-time workers aged between 25 to 34 increased consistently as they obtained higher educational degrees. In 2020, the median earnings of holders of a master’s degree or higher were $69,700 — some 17% more than those with a bachelor’s degree only ($59,600).
Similarly, In 2021, the National Association of Colleges and Employers (NACE) reported that earning a master’s degree can boost your salary, compared to earning a bachelor’s degree only. However, not all programs or fields reported a substantial salary increase. Majors like biology, business administration and nursing reported an increase of 86.5%, 51.4%, and 44.4% in differential percentages, respectively. While majors like statistics, finance, and accounting reported a 19%, 15%, and 4% increase, respectively.
Still, the salary gap has been narrowing since 2017. Another NACE report from 2022 shows that, for the fifth year in a row, the gap between the average starting salaries for a bachelor’s and a master’s degree has shrunk, recording an all-time low of 22.5% in 2021. To explain this decrease in salary differences, Shawn VanDerzeil, executive director at NACE, says in the report that in a competitive job market, employers have started to pay more attention to candidates’ skills, abilities, and knowledge, which has opened more positions to bachelor’s degree holders.
The relatively slim bachelor’s-master’s income difference is probably also due to the low salary earned by workers holding a graduate degree within the humanities. In 2019, master’s degree holders in the humanities had one of the lowest median annual earnings, at $60,000 for full-time workers, according to a study by the American Association of Arts and Sciences. In other words, their salary was roughly the same as the national average for those who only earned a bachelor’s. The sole discipline ranking lower in salary was the arts, where master’s degree alumni earned an average of $54,000.
In fact, one 2022 study by The Foundation for Research on Equal Opportunity found that master’s programs in the arts and humanities rarely pay off at all. The study investigated the return on investment (ROI) for various degrees by calculating the increase in lifetime earnings a student can expect from that degree, minus the direct and indirect costs of attending graduate school. Of the 14,000 graduate degrees included in the study, 40% of master’s degrees didn’t produce a positive ROI — and the humanities, as well as the arts, represented a substantial chunk of those programs. To give an idea, while the median master’s degree in computer science or engineering increases net lifetime earnings by over $900,000, a master’s degree in the arts or humanities has a median return of negative $400,000.
While the key takeaway from these figures is that the return on educational investment varies enormously across different programs, it’s disconcerting that so many students in the arts and humanities reach an income ceiling at the bachelor’s level. That’s especially true at a time when the cumulative student debt in the US sits at a startling $1.745 trillion — a figure that has led some experts to call it a debt crisis. The average debt for a master’s degree student is $80,494 and the average borrower takes 20 years to pay off their debt; some professional graduates, however, take over 45 years to repay student loans.
“I think higher education in the US has to reinvent itself,” says Coffey. “Degrees have become too expensive.” Whether pursuing an undergraduate or a graduate degree, students owe hundreds of thousands of dollars in debt, especially among minorities, underrepresented groups, and people of color. “I work with a lot of first-gen students,” she says. “Many of them are the first in their families to ever get a kind of graduate degree. So just navigating the whole landscape of, ‘How do you go about getting into grad school? How do you pay for grad school?’ This is all foreign to them because they don’t have the same type of access to resources. The system was designed, in a way, to exclude them.”
Manage your expectations
Perhaps you’ve already decided that furthering your education is a smart career move and that you can handle the financial burden. That’s great! But do keep in mind that higher education is a journey – and you won’t always know where it will take you.
It can be very tempting to believe that once you obtain a master’s degree, everything will fall into place and you’ll know exactly what you want out of your professional life. Unfortunately, that’s not always true. “I think one drawback is pursuing a master’s degree and thinking you’ll figure out what kind of job you want with it once you graduate,” says Coffey. Going into a program without a clear focus on what you want to gain, what skill sets you wish to improve, and what you hope to do after graduation is a big negative, she adds.
Another part of the equation, and “knowing thyself,” is making sure that you’re actually up for one or two more years of study. After all, spending long hours in classrooms or hunched over your laptop can be draining, so pausing to check your energy levels is always a good idea. Similarly, professionals thinking about going back to school need to consider both the readjustment to student life, as well as the potential cost of spending time away from the job market. “You have to get back into the rhythm of your schooling,” says Aman Shukla, a master’s student in computer science at NYU. “You have to get into that whole schooling kind of mindset that you want to go to class every day, come back, study, go to the library, stuff like that.”
Maybe I’m not up for it… is there an alternative?
Luckily for those who decide that a higher degree is simply too expensive or not worth the effort, a graduate diploma isn’t a prerequisite for an exciting and lucrative career. If you’re trying to holistically improve and advance your knowledge in a particular field of interest, then a master’s degree along with some working experience can make you a strong candidate when entering the job market, says Coffey. But, “if you are just looking to become better at one particular program or skill set, then you don’t necessarily need a one-year or two-year master’s program,” she says.
For example, in the tech industry, you can get certified by boot camps such as Fullstack Academy or Flatiron School. Those are educational institutes offering specialized courses in software engineering, coding, cybersecurity, and product design. While they are generally on the expensive side — typically ranging from $15,000 to $20,000 — they tend to have a high ROI in terms of employability. Keep in mind, however, that these courses aren’t a stroll in the park and will require serious commitment just like any longer program. “Doing some of those classes online is extremely difficult,” says Angerman. “You have to be good at it, and you really have to have the energy.”
So what if you’re not interested in spending any more time in the classroom at all? “There’s always going to be job openings for an electrician or a plumber,” says Angerman. Trade jobs pay very well and typically don’t always require formal education. The trades might offer even more lucrative opportunities today, as the US is currently suffering from a labor shortage in this field, particularly skilled workers, such as plumbers, carpenters, or electricians. “Some people love owning their businesses and setting their own schedules, I see them just as valuable as any other job that we train for in the university,” says Coffey.
Should I be concerned about artificial intelligence?
It’s the question on many workers’ minds: Will the robots take my job? And the conversation has only grown louder in the months since the release of ChatGPT. More broadly, more serious concerns about the future capacities of AI have been around for decades, with predictions ranging from a utopia where humans are enjoying their leisure time on the beach, to an AI hellscape of massive unemployment and a drastically widened gap between the rich and poor.
And there’s a reason for the confusion. For example, research from the World Economic Forum predicts that, by 2025, 85 million jobs globally will be distributed by a new division of labor between humans and machines, where automation will take over previously human-held roles. On the other hand, the very same report states that AI will create 97 million new (human) job opportunities in the same time period.
To Shukla, the master’s student at NYU, the advances of AI isn’t a source of worry. “We still have to understand that these AI devices or models are built by people. So at the end of the day, the controlling knob is still in the hands of a human being,” he says.
The idea that automation and AI will primarily take over mundane tasks is shared by many experts, there among future-of-work expert and author Gary A. Bolles, who said in a recent interview with Welcome to the Jungle that “The problems that we solve in our jobs run across a spectrum: at one end, there are very repetitive problems that can be solved with analytical approaches over and over again; on the other end of the spectrum, there are very unique problems which require truly creative skills to solve.”
To Bolles, creative problem-solving will remain a province of humans for quite some time. But he also points to a need for continuously developing new skills to solve the new issues that AI will bring. Taking that argument further, Dr. Michelle Weise, author of Long Life Learning: Preparing for Jobs that Don’t Even Exist Yet, suggests a future of work in which our increased longevity coupled with advancing AI will render our current educational system obsolete. In an interview with Welcome to the Jungle, she argues that workers will need to continuously reskill and upskill to remain attractive on the job market, and universities will have to revamp their educational model around the central question: “How do we cultivate the best problem-solvers in the world?”
So where does that leave us with regards to decisions about higher education?
Well, while predictions about the future of tech abound, the only thing that’s certain is that we can’t know where the exponential growth of AI will take us. It’s clear AI will come to replace some jobs, but it will also create new ones. So any general advice might be a waste of breath, especially as we’re still in the nascent stages of automation. Instead, those considering a master’s need to investigate its implications in their respective fields, bearing in mind both the potential pitfalls and the many opportunities AI can bring.
Is it time to pursue a Master’s degree?
Investing in a master’s degree can bring many benefits and advantages, including a higher salary, improved employability, and a network of like-minded peers. “You get to meet a lot of people who want to do the same things just in different ways,” says Shukla. Everyone involved in your program may come from a different backgrounds with different ideologies, but they’re all working in the same direction. But before you make that final decision, make sure you’ve done your best to “know thyself” a bit better. Take extra care to interrogate whether you have the determination and energy to get through the program, and what you expect to gain: “If you walk into your master’s program without a career goal in mind, then you are very quickly going to get lost in the program,” Shukla says.
Lastly, it’s important to remember that, while degrees can be important, there are multiple ways to build a solid resume. As Coffey says: “When we’re looking to hire, we’re looking holistically. What skill sets do you have? What experiences do you have? And then, where did you get them from?”
Photo: Welcome to the Jungle
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