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Where you live after graduation also affects its value, according to a May 2020 study by the Thomas B. Fordham Institute, a conservative nonprofit think tank.

“In general, college degrees are a good investment, but the return on investment when it comes to cosmopolitan areas is phenomenal,” said John Winters, associate professor of economics at Iowa State University who conducted the study.

In cities, undergraduate graduates earn an average of $ 95,229, an 86.2% premium compared to an employee with a high school degree and a 55.7% premium compared to an associate degree.

According to Winters, this is mainly because cities have a higher concentration of jobs in areas that often require a four-year degree, such as engineering, finance and marketing. Workers in these areas earn higher wages, which translates into a higher return on investment for deals.

However, Winters’ results also mean that having a four-year degree is less important if you want to live in a smaller metropolis or rural area. Undergraduate graduates in non-urban areas have a median income of $ 67,893, which is a premium of 46.4% compared to high school diploma holders and a premium of 29.6% compared to associate degree holders.

Degree does not guarantee equal opportunities

In some ways, college degrees can exacerbate income and racial inequalities, such as student debt and the ability to repay that debt, says Marshall Anthony Jr., a senior policy analyst at the Center for American Progress, a public policy research organization.