This post is the first of a two-part series on the role that higher education may play in increasing racial and ethnic disparities in income and wealth. Today’s post examines the attainment rates of college education among different demographic groups.
Does a college education level the playing field for people with different socio-economic backgrounds? Despite generations of generally rising college graduation rates, higher education hasn’t significantly reduced income and wealth disparities across all races and ethnicities, according to a recent issue of In the Balance.
While there has been notable progress among Asians, “shortfalls among Hispanics and blacks in both the quantity and the effectiveness, or quality, of postsecondary degrees point toward widening income and wealth gaps in the future,” wrote William Emmons and Lowell Ricketts, who are the lead economist and lead analyst, respectively, for the St. Louis Fed’s Center for Household Financial Stability.
“Thus, rather than promoting economic equality across all races and ethnicities, higher education unintentionally has become an engine for growing disparities,” said the authors.
College degree attainment has increased for all groups but at different rates, Emmons and Ricketts found.
Breaking down rates by birth year, the following figure displays the share of adults aged 25 years or older with at least a four-year college degree in 2015. The birth years are grouped by generations:
“Clearly, millennials of all races and ethnicities are more likely to have a college degree than people of their own race or ethnicity born in the first half of the 20th century,” Emmons and Ricketts wrote. “It’s also clear, however, that the increase in attainment rates has slowed or even reversed recently.”
To show the disparities, the authors looked at differences in college-degree attainment rates between nonwhite groups and whites by birth year. (See figure below.)
“Asian men and women born near the end of the baby-boom period and later are much more likely than whites of the same age to have a college degree,” the authors wrote. “Conversely, Hispanic and black men and women born after the baby boom have fallen further behind their white counterparts.”
Compared with their same-race or same-ethnicity counterparts born before 1946, Hispanic and black millennials have fallen about 10 percentage points further behind whites, the authors found.
Thursday’s post will look at how the gains from college education differ across races and ethnicities.