The Bureau of Labor Statistics of the U.S. Department of Labor is the principal Federal agency responsible for measuring labor market activity, working conditions, and price changes in the economy.
Can STARs shine without a college degree?
Eleni X. Karageorge
Workers often referred to as “unskilled” (individuals with high school diplomas, but not bachelor’s degrees)
experience a fundamentally different wage trajectory than do workers with bachelor’s degrees. In “Skills, degrees,
and labor market inequality” (National Bureau of Economic Research, Working Paper 28991, July 2021), authors
Peter Q. Blair, Papia Debroy, and Justin Heck show how differing wage outcomes over a worker’s career can be
explained by an opportunity gap between those with and without degrees. This opportunity gap suggests that
access to higher paying jobs often depends less on the skills or experience of workers and more on if they
attended college. The researchers argue that these so-called unskilled workers are not unskilled but are “skilled
through alternative routes” or “STARs” because they may have gained skills through their work experience, such
as on-the-job training and military service, or through a certification program.
The authors find that both those with a bachelor’s degree and those who are STARs have little trouble transitioning
between jobs in which the skill requirements are alike. Whether you are a construction worker or an attorney,
finding a job doing the same work somewhere else is not hard. However, if a worker wants to transition into a job
that pays more and requires a different skill, this move upward usually requires a college degree. Workers with
bachelor’s degrees are far more likely than STARs to be able to make that kind of upward jump. Although both
groups of workers can get new jobs at similar skill levels as their previous jobs, STARs experience more difficulty
transitioning to higher paid work.
The authors say that this opportunity gap in obtaining higher paying jobs may explain income inequality by degree
status. This gap does not appear to be driven by differences in knowledge, experience, or skills acquired in
college. Instead, this gap is driven by the lack of access experienced