You Snooze, You Lose? Returns to Interrupted and Delayed College Education in the US

Postsecondary is frequently not acquired straightforward, but through detours and along with initial phases of labor force experience. This circumstance raises the question of the role of timing of higher education for the returns on the labor market. It is further a fortunate situation for separating the role of work experience and education for labor market returns. Since educational detours are more often taken by minorities and young adults from lower social origins, this question also has implications for social inequality in postsecondary education.

The research question is whether delayed entries into and interruptions of educational careers of varying type and duration affect employment outcomes upon labor market entry. The situation of graduates and college-goers never completing is analyzed separately applying propensity score matching. The labor market outcomes studied are whether a job could be found which offers medical insurance, the logarithmized wage and occupational outcomes measured as Hauser and Warrens 1997 version of the Socio Economic Index (SEI). Results show that graduates with a B.A.-degree are not affected by their educational pattern. For incomplete college, the timing matters more. While there are small penalties for interruptions in general, small bonuses can be gained if the time out of the education system was spent with full time work. The dataset analyzed is the US National Longitudinal Study of Youth 79 (NLSY79).