Labor Market Inequality, Debt, and the Consequences of Sub-Baccalaureate Higher Education

U.S. young adults in the 2000s and 2010s entered a national labor market that was highly stratified by education. While the socioeconomic consequences of a four-year bachelor’s degree are well documented during this period, less is known about the consequences of seeking a sub-baccalaureate credential. I analyze the employment, earnings, and student debt outcomes associated with several sub-baccalaureate experiences differentiated by enrollment, credential level, and for-profit attendance using data from the National Longitudinal Survey of Youth-1997 Cohort. Using fixed-effects regression models, I find that certificates and associate degrees are associated with employment advantages relative to a high school diploma. However, young adults with some two-year college and no credential or a certificate have no higher earnings than those with a high school diploma. Sub-baccalaureate credentials can also be costly, as those who attend a for-profit college have more student debt than those who do not. Results shed light on labor market inequality among a large but understudied segment of higher education and underscore the importance of considering debt alongside labor market outcomes in analyses of the socioeconomic consequences of higher education.