Chart Detail

Impact of increasing education and experience on hourly wages of individuals in the middle fifth of the income distribution, selected years, 1979–2007 (2011 dollars)

Change
1979 1989 1995 2000 2007 1979–2007
Education
Less than high school 22.4% 14.8% 12.2% 11.7% 9.8% -12.6
High school only 41.6 43.6 39.4 37.4 35.5 -6.1
Some college 21.5 25.6 31.3 32.5 32.4 10.9
College degree 9.4 10.6 13.5 14.2 16.7 7.3
Advanced degree 5.1 5.5 3.7 4.2 5.6 0.5
Average potential experience (years) 17.8 17.3 18.2 19.1 20.0 2.2
Average hourly wages $14.99 $15.14 $14.74 $16.11 $16.35 9.1%
Average hourly wages, 1979 weights* $14.99 $14.60 $14.00 $15.36 $15.33 2.3%

*Hourly wage controlling for changes in education and experience.

Source: Authors' analysis of Current Population Survey Annual Social and Economic Supplement microdata

Updated May 22, 2012

Documentation and methodology

Underlying data are from Current Population Survey Annual Social and Economic Supplement microdata; see Appendix A for details. Households are ranked in the same way as in the Congressional Budget Office data—by household income divided by the square root of household size. Fifty age/experience “cells” are created (five educational categories by 10 potential experience categories). Average hourly earnings are calculated for each cell. To get the counterfactual wage growth that would have happened without education and experience upgrading, we hold the 1979 cell weights (i.e., the shares of total hours worked in each year by a given cell) constant, but allow the within-cell wage growth to occur. Data are inflated to 2011 dollars using the CPI-U-RS.

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