Holding a Four-Year College Degree Brings Blacks Close to Economic Parity With Whites

New statistics from the Census Bureau confirm the powerful economic advantage that accrues to African Americans who hold a four-year college degree. Current figures for the year 2004 show that blacks with a college diploma now have a median income that is 95 percent of the median income of similarly educated whites. Blacks with a doctorate actually have higher incomes than similarly educated whites. These are extraordinary achievements that have been consistently overlooked by most commentators.

New figures released in late March by the U.S. Census Bureau unequivocally show that possession of a four-year college degree not only greatly increases the incomes of African Americans but goes almost all the way to close the economic gap between blacks and whites.

Here is the set of statistics showing how improved educational attainment advances the incomes of highly educated blacks as compared to those with lower levels of schooling. The first point to note is that blacks with a four-year college degree now earn on average twice the income of blacks who have no better than a high school diploma.

But the new government figures show that even greater value from a four-year college degree occurs when we compare incomes of blacks with varying levels of educational achievement. African Americans with a two-year associate's degree improve their income by only 41 percent over blacks with just a high school diploma. But blacks with a four-year college degree outperform blacks with a high school diploma by 99.5 percent. In 2003 blacks with only a high school diploma had a median income of $18,396. The median income of blacks with a bachelor's degree was $36,694.

How a College Degree Breaks
the Back of Race Discrimination

But the important issue is the impact of a college education on the black-white income gap. Here the story is complicated. The overall median black family income in the United States is 63 percent of the median white family income. This very large gap in the income ratio has remained virtually unchanged for more than 30 years. Through both good economic times and recessions, there has been little fluctuation in the overall racial income gap. But, one asks, what is the effect of the increase in the number of blacks going to college on the overall black-white income gap? Doesn't this make a difference? The simple answer is, no. It turns out that the much greater earnings produced by more blacks who have completed college make little difference to the median income figure (the person in the middle) because only 17.6 percent of all black adults over the age of 25 have completed a four-year college education.

But now look what happens when we put aside the overall black-white income gap and confine our view only to college-educated blacks and whites. In 2003 blacks with a bachelor's degree had a median income of $36,694. This is 95 percent of the median income of whites with a bachelor's degree, which stood at $38,667.

Corporate America is strongly committed to diversifying its work force and particularly its management ranks. Thus, there is a strong demand in the business sector for highly educated African Americans. This demand tends to narrow the income gap between the races for those who hold a college diploma.

Unfortunately, the encouraging news we report, on the narrowing of the income gap between college-educated blacks and whites, is tempered when we break down the figures by gender and work experience. Separating the statistics by gender, one finds that the superior performance of black women is responsible for most of the good news. In 2003 black males with a bachelor's degree had a median income of $41,916, which was only 82 percent of the $51,138 median income of similarly educated white males. Thus, a very large racial income gap persists for black men who nevertheless have beaten the odds and earned a college degree.

On the other hand, black women with a bachelor's degree had a median income of $33,142, which was 110 percent of the $30,082 median income figure for white women who held a college degree. It is clear then that the strong income performance of black college graduates is largely due to the earnings performance of black women while higher education has failed to produce similar income gains for black men in comparison to white men.

This is not to discount the value of a college degree for black men. African-American men with a bachelor's degree or higher still earn on average nearly double the income of black men with a high school diploma.

Income Gap Among Educated,
Full-Time Workers

The statistics showing the strong earnings performance of black women with a college degree compared to white women with a similar educational background are somewhat misleading. The strong performance of black women is largely explained by the fact that black women college graduates are far more likely to hold full-time jobs than white women college graduates. In 2003 only 48 percent of white women college graduates who had some income held full-time, year-round jobs. Nearly 68 percent of black women college graduates worked full-time. Under these circumstances, it is not surprising that the median income figure for black women college graduates is higher than for white women with a college degree. If we adjust the figures and compare the incomes of white women college graduates who worked full-time with those of similar black women, the traditional racial burden persists. We find from the figures that black women have a median income that is 93 percent that of white women.

The Racial Income Gap for Graduate Degree Holders

The Census Bureau also computes median income figures for blacks and whites with master's and professional degrees. In 2003 blacks with a master's degree had a median income of $44,134. This was 88.3 percent of the median income of whites with a master's degree.

Once again, in percentage terms black women fared much better against their white counterparts than did black men. Black and white women with a master's degree had almost identical median incomes, with blacks holding a slight edge. Black men with a master's degree had a median income that was only 82 percent of the median income of white males with a master's degree.

Expectedly, the black-white income gap actually increases for holders of professional degrees. In 2003 blacks with a professional degree had a median income of $61,627. This was only 80 percent of the median income of whites with a professional degree.

It is clear that the economic opportunities for whites with a professional degree continue to be far superior than they are for blacks with a professional degree. White professionals — lawyers, dentists, accountants, and engineers, to name a few — are far more likely to serve economically well-off and better established white clients and therefore are in a position to charge higher fees and earn greater incomes. On the other hand, many whites are still reluctant to seek out the services of black professionals. Therefore, many blacks with professional degrees perform services for an exclusively black clientele and in all likelihood are not able to charge fees comparable to those of white professionals. These factors may explain to some degree the large and often persisting income gap between white and black professionals.

There is also a substantial income gap between blacks and whites who hold doctoral degrees. But this time the racial gap is in favor of blacks. In 2003 blacks with a doctorate had a median income of $72,743. This was 111 percent of the median income of whites with doctoral degrees, which stands at $65,278. The high demand for black academics at American colleges and universities produces a good job market with high wages for blacks with doctoral degrees.

A final consideration: Favorable statistics on the black-white income gap for college graduates always must be viewed in light of the fact that black college graduates make up only a small portion of the entire black population of the United States. According to the latest count, there are 36.4 million people in the United States whom the Census Bureau classifies as black. Of these, 3,854,000, or less than 11 percent, hold a four-year college degree. Therefore, one must always keep in mind that the encouraging economic figures we report here apply to only one in every nine African Americans.

More News & Views