Master’s degree programs rose in popularity during the pandemic. However, earning a master’s degree isn’t a one-way ticket to having more money in your pocket. How can you decide whether it’s worth the investment? You can start by asking yourself these questions:
Will it increase my employability?
Education Data found that, in general, a master’s degree increases employability by less than 3%. Indeed reports that the unemployment rate difference between bachelor’s and master’s degree holders is only 0.2%. Your field of work may differ, but it’s important to understand those odds before committing. Some careers require a master’s degree, like many in the medical and engineering fields. For other areas, the requirement may be a matter of employer preference. Monster offers a great guide to getting around education requirements in job ads here.
Sometimes, just the intention can raise your employability. Many employers may be willing to interview otherwise qualified candidates who don’t yet have their desired credentials. They may want to know that you plan to get your master’s, and they might even help cover the costs. SHRM’s 2022 Employee Benefits Survey shows that 48% of employers offer undergraduate or graduate tuition assistance as a benefit.
Will it result in a higher salary?
The assumption is that, of course, it will. However, actual data depends on where and how you look. U.S. Department of Labor statistics show workers with a master’s degree actually earned slightly less than workers with a bachelor’s degree (median annual wage of $77,750 for a master’s degree versus $78,580 for a bachelor’s degree). Yes, we thought that was strange, too. While other studies do show an increase, it’s not by as much as you might expect.
Using real-time Payscale data and focusing on Austin, Texas, workers specifically, we found that master’s degree holders made an average salary of $81,000 compared to $70,000 for bachelor’s degree holders, a more expected 16% bump in pay. The National Association of Colleges and Employers found that all reported categories of majors at the master’s degree level show projected increases for the Class of 2023. But by how much? Compared to 2022, engineering grads expect a 2% increase, math and science grads a 5% increase, and business majors a 13% increase. Since the numbers are so varied, research your career path specifically and be sure that the data you pull up is recent and geographically relevant.
How much will the degree cost you?
Now that you’ve crunched the other numbers, it’s time to look at the cost of an advanced degree. CNBC reports that nearly two-thirds of people with an advanced degree regret it. The biggest regret? Student loans (and, most damaging, the interest rates on those student loans). This can lead to a cascading effect, says CNBC’s Kelly Heinzerling, who points out that those with student loans have an average of 21% more credit-card debt than the national average. “They also carry it with them for a long time: The average student borrower takes about 20 years to pay off their student-loan debt, but for professional graduates, it can take over 45 years,” she adds.
So, once again, it’s crucial to determine the cost-benefit of a master’s degree in your specific field, weighing your options carefully. Consider private versus state schools, financial aid options, and, again, whether an employer could cover some or all of the cost.
Still unsure? Talk to your recruiter about your marketability with a master’s degree versus without. They’ll be able to provide more specific feedback than what you’ll find online.