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The paradox of working while in college

Work interferes with studies but boosts adult earnings, researchers say

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Proof Points

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Working while in college is risky. A 2018 Georgetown University study found that students who worked had lower grades and were more likely to drop out. The risk was especially high for low-income students. Other studies have found the same. The conventional advice to students is to try to work under 15 hours a week if they want to finish their degrees.

This remains true but it isn’t the whole story. A new study from a Rutgers research center also finds that students who work while in college earn higher salaries afterwards. The more a student earns during his college years, the bigger the bump in adult earnings.

“We’re not denying that completing a degree is valuable,” said Daniel Douglas, a senior researcher at the Education and Employment Research Center at Rutgers University, and one of the study’s two authors.  “But the earnings data tells the opposite story, if you’re looking to earn more money after you complete, you should work.”

“The optimal outcome, of course, is for student to both work and complete a degree,” said Douglas, who is also a visiting professor of education at Trinity College in Hartford. “Then they get the premium from work during college and they also get the premium associated with completing a degree.”

For example, a student who earned between $5,000 and $15,000 (roughly equivalent to a standard 20-hour a week part-time job) during the first year of a two-year associate degree program subsequently earned $4,200 more a year, on average, than a student who didn’t work. For students who earned more than $25,000 during their first year, the annual earnings bump was more than $18,000, compared with a classmate who didn’t work. These are average benefits. Not every student reaped them and some earned much more. The researchers calculated similar income spikes for working students in bachelor’s degree programs.

Related: A new way of helping students pay for college: Give them corporate jobs

Even working students who didn’t finish their degrees still earned extra income after they left school. Indeed, the earnings premium from working during college was very similar to the earnings premium from finishing a degree, the researchers calculated.

The study is still a draft paper, meaning that it could still be revised before it is published in a peer-reviewed academic journal. But it was publicly presented in Toronto in May 2019 at the annual meeting of the American Educational Research Association.  Paul Attewell, a sociology and education professor at the Graduate Center of the City University of New York, is the second author.

Previous research has relied on student academic records. But Douglas and Attewell had rare access to student employment records because a large public university system merged its students’ transcript data with state records reporting wage and employment information during and after college. The authors didn’t identify the name of the university but said it was “emblematic of non-elite, mass higher education” in the United States. Scholars familiar with the study confirmed that the students were spread across more than a dozen campuses in New York City.  The researchers focused on more than 160,000 students under 25 who started either a two-year or a four-year degree program between 1999 and 2008 and continued to track their earnings through 2014.

Roughly a quarter of the two-year and a third of the four-year students didn’t work in their freshmen year. (Nationally, according to federal data, about 40 percent of undergraduates don’t work.) Of those who did work in the New York study, the vast majority made less than $15,000. It was very rare for a first-year student to earn more than $25,000. Fewer than 3 percent of associate degree and 1 percent of bachelor’s degree students were working that much.

The big hole in the study is that we don’t know how many hours the students worked or how much they made per hour.  In theory, they could have earned $20,000 through a 15-hour a week internship at Goldman Sachs or flipping burgers for 30-hours a week at Shake Shack. Thus it was impossible for the authors to calculate exactly the number of hours at which the risk of dropping out exceeds the value of working during college. “I wish we had a magic number, but we don’t,” said Douglas.

Instead, the authors found no downside to earning a lot while in school. The more that students worked in college, the more they subsequently earned in the labor force.  “That was the most surprising thing,” said Douglas. “We would have expected there to be some diminishing returns because you’d be less likely to complete the degree, but we didn’t find that.”

Related: Quantifying the risks of working while in college

But getting an education matters too. For example, a student who finished a bachelor’s degree earned almost $9,000 more than a student who dropped out after completing less than 20 credits. At the same time, a working student who earned between $15,000 and $25,000 during freshman year subsequently earned $10,000 more than a student who didn’t work.

Why do working students earn more later? It’s not obvious. Douglas didn’t do a thorough review of exactly what jobs students had but it was clear from his scan of student employment that many students were in low-end retail and service-sector jobs.

“That’s also a lesson. That kind of work is not completely without value,” he said. “These students are establishing a work history and it signals to employers that you show up on time, take direction and have the capacity for work.” (For the record, Douglas worked as a part-time retail clerk in a toy store while he was in college. I did supermarket checkout. But I am confident that my earnings are a lot lower today than my classmates who did not work!)

Douglas said that research partners are also finding strong benefits to working in college in Texas and Virginia. So the phenomenon is not unique to the New York City job market.

One possible interpretation of this study is that establishing a work history is even more important than getting a degree. Among these New York students, the salary bump from working sometimes exceeded the salary bump from completing a degree. “I can’t control what people are going to say about this research,” Douglas said. “That’s a potential conclusion that somebody could draw or an argument that someone could make.” But his preferred interpretation is that students should try for both a degree and incorporating work into college life.

More importantly, advising students to stop working and focus on school is misguided, he says. Instead, he wants college administrators to see this research and realize that they need to help students balance work with studies and see working part time as valuable for students’ futures. He hopes businesses that employ college students will pay attention too. “You don’t want to schedule students in ways that will hurt their studies,” he said. “A lot of the work that students do has just-in-time scheduling and can get in the way of students’ academic progress.”

This story about working in college was written by Jill Barshay and produced by The Hechinger Report, a nonprofit, independent news organization focused on inequality and innovation in education. Sign up for the Hechinger newsletter.

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Jill Barshay

Jill Barshay is a staff writer and editor who writes the weekly “Proof Points” column about education research and data. She taught algebra to ninth… See Archive

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