Demographics, Education: Premium pay for Masters degrees falls

Salaries for Master’s Degrees: Income Gap Narrows With Raises for Bachelor’s – Bloomberg

From population demographics, the cohort of young new workers in their 20s is now becoming smaller than previous cohorts. For the past few decades, thanks to the Baby Boom and the Baby Boom Echo, new workers had to compete with each other for good jobs – that meant acquiring more education, often at name brand and elite universities, to stand out from the crowd.

Today, the pattern has flipped, and employers must compete for a smaller pool of workers. This means demand for Bachelor’s degree graduates is hip again. The Master’s degree was often not required for the work skills – it was instead a way to distinguish oneself from many other young people seeking good jobs.

The U.S. went through a higher education bubble during the past decades (about 1970 onwards). Remember, in 1965, only half of U.S. adults had graduated from high school. Today, among the younger cohorts, over 40% have a college degree.

The times are changing due to population demographics. The above is a sign that changing demographics are already here and having an impact.