The Economy Goes To
College:
The Hidden Promise of Higher Education
in the Post-Industrial Service Economy
Anthony P. Carnevale and Stephen J. Rose
April 13, 2015

Overview
• College-educated workers make up only 32 percent of
the workforce, but now produce more than 50 percent
of the nation’s economic output.
• The dramatic increase in the economic value
generated by college-educated workers is directly
linked to the rise of a college-educated service
economy.
• The mass production of standardized goods and
services has been replaced by more complex consumer
demands.

Two main drivers in the shift to a high-wage service economy
• We have shifted consumption from goods to services.
• The production of goods has dropped below 15 percent.
Source: Georgetown University Center on Education and the Workforce analysis of data from the U.S. Department of
Commerce, Bureau of Economic Analysis, 1947-2011.

Between 1967 and 2007, manufacturing jobs declined
Source: Georgetown University Center on Education and the Workforce analysis of U.S. Department of Commerce,
Bureau of Economic Analysis, Input-Output Accounts, 1967-2007. *Values may not sum to total due to rounding.

Business services employed more people between 1967
and 2007
Source: Georgetown University Center on Education and the Workforce analysis of data from the U.S. Department of
Commerce, Bureau of Economic Analysis, Input-Output Accounts and U.S. Census Bureau, Current Population Survey,
1967-2007.

• Today, farmers account for only 5 percent of the
value added in food production. Almost 20
percent of the value added in the food network
comes from the bankers, insurance firms,
advertisers, and other business services involved
in bringing final food output to the table.
We have changed how we produce what we consume

• There has been a large decline in low-skill jobs that
require a high school education or less.
• There has been a substantial growth in managerial
and professional jobs requiring college degrees.
Occupations

From 1967 to 2012, more college educated workers
joined the workforce
Source: Georgetown University Center on Education and the Workforce analysis of data from the U.S. Census
Bureau, Current Population Survey, 1967-2012. * Values may not sum to total due to rounding.

Conclusion
• The largest increases in high-skill jobs occurred in
exports, business services to individuals, housing and
government.
• Low-skill employment between 1967 and 2007
declined overall except in the food industry.
• Middle-skill jobs decreased overall except clothing,
housing, investments, and government

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