‘Better’ college does mean bigger income: reportBy Yoon Min-sik
Published : July 12, 2023 - 18:05
Backing what many in South Korea already believe as a fact, a recent research found a correlation between university rankings and income levels of graduates.
The study, conducted by a joint team of researchers from Seoul National University and the Korea Development Institute, analyzed the wage levels of 21,178 South Korean adults aged between 25 and 59, classifying them into five groups based on the rankings of their alma mater institutions.
The researchers found that the average income increased in accordance with university rankings, with the top-tier group earning an average of 8.62 million won ($6,680) more in annual salary than their peers from the bottom tier.
The income disparity between different ranking groups tend to widen as the graudates progress in age. The top-ranked group earned 24.6 percent more than the bottom-ranked group when they first entered workforce, but the gap posted a peak at 50.5 percent when they reached ages 40-44.
After 44, however, the discrepancy significantly drops. The income gap between the highest and lowest groups shrinks to just 1.1 percent among those aged 55-59.
“Most graduates of top-ranking universities secure jobs at larger companies where employees tend to have longer tenures and experience more significant wage growth,” researchers said.
They attributed the sudden drop in income gap after 44 to many employees at major conglomerates quitting between middle and higher managerial positions.
The study also found that people whose fathers received a high level of education were more likely to attend prestigious universities.
“We’ve found that until a certain age, there is a considerable wage gap based on the rankings of universities (that people graduated from), which is closely related to the types of jobs they get,” the researchers noted.
They added that additional studies are needed to determine how much of the wage gap can be attributed to the university’s prestige, and how much is due to each individual’s abilities.
The study, titled “University Ranking and the Lifetime Wage Gap,” was published in the Korean Journal of Economic Studies, published by the Korean Economic Association.
Universities were grouped into five, based on the state-commissioned college entrance scores required for admission from 1998 to 2000. Sixteen institutions were named in the top tier, including the so-called "SKY" university league of Seoul National University, Yonsei University and Korea University.
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