Higher education has long been touted as the path to economic success and a way to level the playing field. Yet, could higher education also be worsening inequality in America?
During a recent Dialogue with the Fed event, Assistant Vice President and Economist William R. Emmons discussed trends in income and wealth premiums for those with bachelor’s degrees and those with postgraduate degrees. He also examined the role that race and ethnicity play in successfully obtaining a college degree.
When looking across race and ethnicity, “college may even have become an engine of inequality,” he said.
Citing previous research, Emmons noted that gains in the attainment of bachelor’s degrees have not been equal among different demographic groups.
“College graduation rates, first of all, have increased for all races and ethnicities ... but there are some gaps, some disparities,” he said. “For example, (college degree) noncompletion rates among Hispanic and Black students are still higher than for whites and others, which includes the Asian group.”
Another disparity is that the gaps in college degree attainment by race and ethnicity across generations are rising, Emmons pointed out.
“The increase in the (bachelor’s degree) attainment rate for Black and Hispanic students has been rising, but not as fast as that for white students,” he said. “So that in itself is an indicator that college is not fulfilling its promise of bringing everyone along at the same rate.”
He also noted that access to elite institutions remains very uneven among different demographic groups, as does the level of success when someone enrolls in an elite institution.
“Precisely because college is becoming important for so many reasons, these gaps undermine the narrowing of income and wealth gaps that we are increasingly concerned about and aware of,” he said.