Degrees of Success: How Higher Education Translates into National Wealth

Michael L. Mathews, Chief Information Officer at Oral

Michael L. Mathews, Chief Information Officer at Oral

The ultimate value of education is evident over time versus one degree or one college at a time. Too often, people focus on the single value of a tuition bill, one degree, or one college. This perspective is anticipated when considering how to invest on a short-term basis. However, when considering the value of investment over time, you will find no greater investment than in educating a family, a community, a city, a region, or an entire nation.

Evaluating the cost of a single college degree is like determining the value of one bumble bee that produces honey: the value of both is difficult to see. According to the most recent data, a single person obtaining a bachelor’s degree will earn $2.8M more in their 35-year work career than someone without a college degree. The significance of that one person’s earning potential is difficult to measure. However, against the backdrop of an entire community, city, region, or nation. The same is true of that one bumble bee comparison until you step back and discover that bees are an essential part of our agriculture, pollinating many fruits, nuts, and vegetables; their existence directly impacts food security. In fact, one out of three bites of our daily food is possible because of bumble bees. Imagine evaluating the value of bees by staying focused on the one that just bit you or landed on your plate of food.

The same principle of measuring the whole of education reveals the incredible value of educational investment for a society, whether it is a family, city, region, or nation. Enough evidence shows that any community’s wealth, productivity, and success are directly linked to education. We will use a few simple examples that illustrate this reality. The value of education is cumulative over time, and the overall value a society places on education.

In the Trillion Dollar World of Endowment Funds infographic shown below, you can see that the wealth within a country, when measured by its ability to have philanthropy (endowment funds) for its communities and stakeholders. You will quickly notice that most entities holding the endowment funds are educational institutions. You will also note that the majority are in the United States. Over time, education will define a country's outcomes versus viewing the value of investment one degree at a time. Many educational institutions mentioned within the infographic have existed for 100-225 years.

These prevalent educational institutions continue to show their growth over time, versus one college degree at a time. However, it takes one degree at a time to begin the journey that education ultimately produces. One degree at a time helps a single person earn a living that allows them to give back to the place they now feel has invested in their own personal wealth. It is unsurprising, then, that many of these wealthy people who supported their educational institutions by earning their academic degree(s) give back, as they feel that the academic institution(s) invested in them a far greater value than they gave. There is a beautiful value at both ends of the education ecosystem. Remember that each individual who graduated with a college degree has an average of $2.8M more to invest during their lifetime.

Harvard University alone has more financial resources than the entire GDP of countries like Serbia, Bolivia, El Salvador, and Slovenia. When just one educational institution produces that much wealth, it speaks to the value of education investment over time. Now factor in the millions of graduates of the 3,900 colleges and universities in the United States who each made between $1 million to $3.6 million more in their careers, based on when they graduated college. Lastly, for icing on top of the education cake, factor in the tens of thousands of education graduates who developed patents and inventions that propelled trillion-dollar businesses like Apple, Google, Amazon, and Microsoft, among others. With less than 4% of the world's population, the United States has invested in education and individually borrowed against the future to become one of the world's most educated and wealthy societies.