Where college graduates earn the biggest salary premium in the United States

For many people across the U.S., going to college is the inevitable next step after graduating high school. But it’s not just an unquenchable thirst for knowledge behind that trend — there’s also the expectation that bagging a college degree will open the door to high-paying jobs, with seven in ten Americans believing that college-educated people have higher earnings compared to high school graduates.

Of course, plenty of young professionals straight out of high school have jobs that rake in the big bucks — but by and large, the typical college graduate in the U.S. will make $1.2 million more over their lifetime than someone who hasn’t been to college, and is 3.5 times less likely to experience poverty. Male graduates, in particular, will have the highest salaries. 

This got the team here at Career.io pondering: where in the U.S. will college graduates make the biggest salary premium over a local worker who hasn’t been to college? And where will male and female graduates outearn their counterparts without a degree the most? 

For every state and the 1,000 most populated cities in the U.S., we used Census data to calculate the percentage difference between the median earnings of local college graduates and high school graduates over the age of 25.

Key insights

• In California, college graduates make 96.56% ($37,181) more than workers without degrees — the biggest salary premium of any state. 

• Meanwhile, college graduates in Hoboken, New Jersey, earn 305.63% ($81,478) more than local workers without degrees, the biggest salary premium of any city. 

• In contrast, the typical college graduate in Gary, Indiana, earns $18,750 less (-50.22%) than someone who hasn’t been to college, the biggest negative premium of any city. 

• Female graduates earn the biggest salary premium over their non-degree counterparts in Edina, Minnesota (390.29% or $54,059); male graduates do so in Johns Creek, Georgia (341.92% or $89,444). 

College graduates in California earn 96.56% more than high school graduates 

Whichever U.S. state you live in, if you’ve got a bachelor’s degree on your resume, it’s likely you earn more than the average person in your state who hasn’t been to college. That’s because our research reveals that the typical degree-holder in every state makes a substantial salary premium over their non-degree-holding counterparts, with California coming top overall. In the Golden State, college graduates earn a staggering 96.56% (or $37,181) more than high school graduates. 

Here, the one thing that unites both college graduates and non-degree holders alike is that things are much too expensive, with the high cost of living driving out workers from eye-wateringly pricey metropolitan areas like Los Angeles and San Francisco. After California comes New York (where a typical graduate earns 91.47% or $34,190 more than someone without a college degree) and New Jersey (with a price premium of 90.89% or $36,532). 

Women with degrees in New Jersey make 105.27% more than their counterparts without degrees

Women make up more than half of the college-educated workforce in the U.S., but where are college-educated female workers outearning women who haven’t got a degree the most? New Jersey comes top in that respect, a state in which the average female employee with a bachelor’s degree earns $33,170 more than a female high school graduate (a 105.27% salary premium).  

According to the Institute for Women’s Policy Research: “A growing share of employed women in New Jersey are in managerial or professional occupations. About 45 percent of women hold these positions, which tend to require a four-year degree and often have higher wages and employment benefits.”

Male college grads, meanwhile, earn the biggest salary premium (102.91% or $43,953) over their high school graduate counterparts in California, where 70% of managerials and professionals working in Silicon Valley’s Big Tech firms are men. After that comes Maryland (a 91.27%, or $42,951 premium). Here, workers, male and female alike, with a bachelor’s degree can expect to rake in lifetime earnings of $3.1 million, one of the highest totals of any state in the country. 

The city in each U.S. state with the highest salary premium for college graduates

Next, we mapped the city in every state where college graduates earn the biggest salary premiums over high school graduates. Novi in Michigan is one such city where the salary difference is particularly stark: here, the average college graduate earns some $57,703 (or 258.19%) more than someone without a degree. In late 2023, the state’s governor announced that Novi would be creating 200 “high-paying” jobs in engineering, a field that typically requires a bachelor’s degree. 

Palo Alto comes top in California, where we found that degree holders earn $81,503 (or 256.03%) more than workers without degrees. Palo Alto has long been an area associated with the highly educated; in the 1950s, more than one in three local men had a degree at a time when only 7% of American adults had completed four years of college. Astonishing salaries are common in Silicon Valley, too, of which Palo Alto is a major part: in 2022, the Valley’s top 5% of earners averaged close to $700k in salaries.

Hoboken, New Jersey, and Silicon Valley cities are home to the highest salary premiums

When ranking the top 10 overall cities with the highest graduate premiums, two other Silicon Valley locations appear alongside Palo Alto: Cupertino, where college graduates earn 232.50% (or $96,295) more than their non-degree-holding counterparts, and Mountain View (226.96% or $90,928). While the high-tech careers that the Valley is known for tend to require advanced industry skills, as it happens, tech giants like Google and Apple aren’t asking for degrees as much as they used to. 

Head and shoulders above the rest, however, is Hoboken, New Jersey, where the average college graduate earns a staggering 305.63% premium (or $81,478) more than a worker without a degree. In particular, the alumni of the city’s Stevens Institute of Technology earn more on average than any other college in New Jersey, including the prestigious Princeton University. 

The situation couldn’t be more different in other cities across the U.S. In Gary, Indiana, the average degree holder earns $18,750 less than a worker without a degree, which translates to a negative premium of -50.22% — the largest of any city in the U.S. The most common job groups in Gary are Office & Administrative Support Occupations (3,251 people), Material Moving Occupations (2,092 people) and Sales & Related Occupations (1,895 people).

In one Georgia city, male college graduates make 341.92% more than men without degrees

In Johns Creek, one of the most affluent cities in Georgia, men with college degrees earn 341.92% (or $89,444) more than male workers without them. Here, life sciences and healthcare are the biggest target industries. Newton, Massachusetts, also sees male college graduates earn a healthy premium (310.04% or $104,699) over men without degrees, a city home to two of the wealthiest men in America (both of whom have college degrees). 

Turning our attention to female graduates, Edina in Minnesota ranks as the city with the highest salary premium (390.29% or $54,059) over women without degrees. Here, women earn the biggest bucks in agriculture, forestry, fishing, hunting and mining, an industry in which the median salary for women is a quarter of a million dollars. 

College degrees don’t guarantee big earnings… and you don’t need a degree to earn big

Our research reveals that in some places, someone with a degree has the potential to earn the salary of their counterpart without a degree several times over. It doesn’t tell us that getting a degree is a surefire way to make lots of money; even at the most elite universities in the U.S., certain majors are associated with annual salaries of less than $30,000.

It also doesn’t tell us that not going to college will forever haunt your earning potential. Some of the biggest and most well-paying companies in the world, for instance, are beginning to loosen their requirements for a college degree. Take Google, where employees can rake in hundreds of thousands of dollars a year in compensation; the number of Google job posts that required a bachelor’s degree decreased from 93% to 77% between 2017 and 2021. At Apple, they went down by 18%.

In a country where 51% of people have to drop out of college because they can’t afford it and where 34% of young adults can’t go at all because of the high costs, that can only be good news. 

Methodology

To determine where college graduates earn the biggest salary premium in the United States, we focused on the 1,000 most populated U.S. cities and each U.S. state. 

For each city and U.S. state, we used the U.S. Census American Community Survey (2022) to discover the median earnings in the past 12 months (inflation-adjusted) for the population aged 25 years and over among High School Graduates, High School Graduate Males, High School Graduate Females, Bachelor's Degree Holders, Bachelor's Degree Holding Males and Bachelor's Degree Holding Females.

 We calculated the percentage difference in earnings for each location between high school graduates and bachelor's degree holders. We repeated this analysis for male and female high school graduates vs. bachelor’s degree holders of the same gender. 

After that, we ranked the cities, cities per state, and states based on having the highest salary premium (%) for bachelor's degree holders.

The analysis of this data is correct as of February 2024.

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