Learning and Earning: Working in College

LEARNING AND EARNING:

WORKING IN COLLEGE

JONATHAN M. ORSZAG

PETER R. ORSZAG

DIANE M. WHITMORE

C

OMMISSIONED BY UPROMISE, INC.

AUGUST 2001

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Executive Summary

Ð'* Students are increasingly likely to work while in college. Since 1984, the fraction of

college students aged 16 to 24 who also work full- or part-time has increased from 49

to 57 percent. Not only are students more likely to work today, but they are more

likely to work full-time: the share of students working full-time while going to school

full-time has nearly doubled, rising from 5.6 percent in 1985 to 10.4 percent in 2000.

In 2000, 828,000 full-time students worked full-time, compared to 366,000 in 1985.

Ð'* Working students can be categorized into two groups: those who primarily identify

themselves as students but who work in order to pay the bills, and those who are first

and foremost workers who also take some college classes. Almost two-thirds of

undergraduates who work consider themselves "students who work"; the other third

consider themselves "workers who study."

Ð'* In the 1995-96 school year, employed students worked an average of 25 hours per

week. Students at four-year colleges are more likely to work a smaller number of

hours per week. On average, working college students earn roughly $7.50 per hour.

Ð'* The empirical evidence suggests that the effects of working while in college varies by

the type of job held (e.g., full-time vs. part-time work) and its relation to the academic

environment (e.g., an on-campus vs. an off-campus job).

Ð'* Part-time student employment may have beneficial effects: for example, an oncampus

research position may spark a student's interest in further academic programs

or provide important work experience that will improve future labor market

prospects. Working part-time as a student generally appears to supplant only nonproductive

activities, such as watching television. In addition, students who work

fewer than 10 hours per week have slightly higher GPAs than other similar students.

Ð'* However, full-time employment may impair student performance. For example, 55

percent of those students working 35 or more hours per week report that work has a

negative effect on their studies. Students working full-time also reported the

following liabilities: 40 percent report that work limits their class schedule; 36

percent report it reduces their class choices; 30 percent report it limits the number of

classes they take; and 26 percent report it limits access to the library.

Ð'* Students who work full-time are also more likely to drop out of school. For example,

the available evidence is consistent with a roughly 10 percentage point differential in

graduation rates between full-time and part-time workers. In 2000, nearly 830,000

full-time college students worked full-time. Because of the adverse effects of such

full-time work, tens of thousands of these college students are likely to drop out of

school and fail to receive a college degree.

Ð'* Working a limited number of hours (e.g., 10 hours a week) at an on-campus job

appears to have positive impacts on student performance, while working a significant

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number of hours (e.g., 35 hours or more per week) has adverse consequences. It is

unclear at what point student employment moves from being beneficial to being

counterproductive. But the difference between graduating from college and not

graduating from college may involve a change in work schedules that would have a

modest impact on student earnings relative to the lifetime gains from completing

college. For example, reducing hours worked by 10 hours (from 35 hours per week

to 25 hours per week) would reduce a student's annual earnings during the school

year by roughly $2,250. Such potential earnings pale in comparison to the lifetime

gains from completing college.

Ð'* Since full-time work appears to have negative effects on student enrollment rates and

perhaps also on academic performance, it is therefore of particular concern that fulltime

work among full-time college students has risen sharply over the past 15 years.

For these students, the research suggests that, if possible, it may be prudent to find

other ways of financing college so they can complete their degrees, maintain their

academic performance levels, and thereby reap the long-term benefits of a college

education.

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Learning and Earning:

Working in College

Jonathan M.