Transcripts

Dollars & Degress...Do They Add Up To Real Worth?

SUSIE GHARIB: Have you ever wondered if you`re being paid what you think you`re worth? Does graduating from an Ivy League school mean you`ll earn more or is it more important to have a master`s degree or a Ph.D., instead of a bachelor`s degree? Our home economist Brett Graff has been looking into how our salaries are figured these days, and she says it`s nowhere near as simple as that.

BRETT GRAFF, HOME ECONOMIST: According to the National Association of Business Economists, 35 percent of U.S. companies reported raising salaries in the first three months of 2005. So if you work within the 65 percent that reported payrolls unchanged, you might be wondering, how can I grow my paychecks? Well, for starters, you can shop around geographically. The U.S. Labor Department says that accountants and auditors, perhaps expectedly, earned about $51,000 in Birmingham, Alabama, and more than $62,000 in Hartford, Connecticut. But in Santa Rosa, California, their median wage was close to $78,000. Computer programmers, meanwhile, made over $83,000 in San Francisco, more than $64,000 in Chicago, and -- who knew -more than $106,510 in Huntsville, Alabama. Or you can invest in your education. New research shows that a practical degree in say computer science is worth more money in the labor market than a fancy one in philosophy.

PAUL HARRINGTON, PROF. CENTER FOR LABOR MARKET STUDIES, NORTHEASTERN UNIVERSITY: The lifetime earnings gain associated with a degree at the baccalaureate level for someone from an elite college relative to someone who doesn`t go is only 1 to 2 percent.

GRAFF: So, what are firms looking for then?

HARRINGTON: There`s really three things. One is lots of work experience when you`re young to get acclimated to the basic behavioral skills you need to succeed in the job. Two, strong literary proficiencies -- reading, writing and math. And then three, specific occupational skills.

GRAFF: But what about those of us who are mid-career and unhappy?

HARRINGTON: The strategy they want to undertake is really moving -- is building on the work experience and the education they have and trying to figure out what`s an alternative area that I can move building on the educational experience I have and maybe engaging in some additional educational activities. It`s very tough to start over again and say I`m really going to change my career because you have to start at the bottom.

GRAFF: The U.S. Labor Department says that by the year 2012, the economy will create the highest number of jobs, 6.2 million, in professional occupations. There will be openings for 623,000 registered nurses, 207,000 lawyers, 969,000 chief executives and 191,000 doctors. Want to be in sales? We`ll need 22,000 more real estate brokers and they`ll be 73,000 job openings for security and commodity brokers. But what about our admiration for risk-taking billionaires, such as Microsoft founder Bill Gates who dropped out of Harvard? Well, remember Professor Harrington? He points out that everyone who enters the labor market is a risk-taker. Like these students, betting that their educational investments of time and money will reap financial rewards. Brett Graff, NIGHTLY BUSINESS REPORT, home economist.