With the difficulties new college graduates face repaying student loan debt (now a cumulative $1.5 trillion in the United States), many are questioning whether the cost of higher education is worth the potential reward of a bigger income. After all, two of the richest men in America, Mark Zuckerberg and Bill Gates, do not hold college degrees. While both went to Harvard, neither earned a diploma, and they benefited from on-the-job training as founders of Facebook and Microsoft, respectively.

But Wait! College Does Pay Off

As the cost of college has risen, so has the demand for college graduates along with the economic penalties of not holding a four-year degree. According to 2016 data from the Bureau of Labor Statistics, weekly earnings for high school graduates were $692. Those with a bachelor’s degree earned $1,156, and those with a master's degree earned $1,380.

This is a huge wage gap, and the differential reflects a shift in the nature of the workplace: There are fewer positions involving physical labor like manufacturing and farm work and more knowledge-based jobs, like programming and marketing, where a bachelor’s degree is required or preferred. (For more, read: Are U.S. Colleges Still A Good Investment?)

Not convinced that making twice as much as someone without a degree is worth going to college? Consider the studythat MIT economist David Autor published in the journal Science back in 2014. Autor showed that, after all the costs associated with a college education were factored in, the holder of a degree over a lifetime of earnings came out $500,000 ahead. Not a bad deal for a four-year investment. On average, a public university costs approximately $26,000 (in-state); a private one, $51,000. 

On the flip side, high-school graduates are increasingly being penalized in a knowledge-based workforce. According to CNBC reporting on findings by the Economic Policy Institute, college graduates earned 56% more than high school grads in 2015. This is the largest gap seen since 1973. Unsurprisingly, today’s high-school grads are more than three times more likely to live in poverty than their predecessors.

Not All Degrees Are Equal

But what about holders of two-year associate degrees or people like Zuckerberg and Gates who have some college? Unfortunately, according to the Pew study, two-year-degree holders hardly fare better than high-school graduates with median earnings of $819 per week. 

Of those holding bachelor’s degrees, according to GetEducated.com, the most lucrative majors in terms of income for 2018 are Management Information Systems (average salary $158,000, expected growth 15%), Marketing (average salary $131,180, expected growth 9%), Economics (average salary $101,050, expected growth 6%), Business Management (average salary $97,230, expected growth 6%), Finance (average salary $81,760, expected growth 12%) and accounting (average salary $68,150, expected growth 11%)

What On-the-Job Training Offers

But what about learning on the job. Is real-world experience preferable to an academic education? On-the-job training is often free, or you may be paid. Unfortunately, many formal training programs have fallen victim to corporate spending cuts although there are still fields where hands-on training is available.

Industries in which guilds and unions dominate, such as construction trades like plumbing, carpentry and electrical, have traditionally offered apprentice programs as a means of entry. All three major unions for electricians, for example, offer paid apprenticeships with on-the-job and classroom training. There is similar training for the growth fields of telecommunications installers and green-energy technicians. However, these are not casual commitments. All of these industries require at least 2,000 hours of on-the-job learning, with some requiring as many as 4,000 to 6,000 hours. 

The U.S. government has put a focus on high-tech apprenticeships as a fast track to a middle-class paycheck, with the Department of Labor pledging $175 million in grants in 2016 to develop public-private apprenticeship programs in biotech, healthcare, information technology and high-tech manufacturing. Programs resulting from that funding should start appearing over the next few years.

Chefs and other kitchen staff often start their careers by learning and earning through a combination of hands-on training and classroom work. Although culinary school is an option, it is not a requirement. The American Culinary Federation offers formal, multiyear apprenticeships, while some vocational training programs place students in internships. 

Another option for on-the-job training for white-collar work is sales. Real-estate brokerages and telephone-sales operations typically offer real-world training. (See also Financial Careers Without A College Degree.)

Probably the most extreme form of on-the-job training is entrepreneurship where starting your own business teaches you how to manage employees, cash flow and inventory while simultaneously marketing your new business and negotiating with suppliers and customers.

The Bottom Line

Measured by statistics, the decision to get a four-year degree is clear. Even if getting a diploma means taking on substantial debt, research suggests that over throughout a career, you will still come out ahead financially even if you opt for the most expensive route such as a private college. However, you are an individual – not a statistic – and where your interests, ambitions and aptitudes lie should ultimately determine your approach to higher education and whether your career path begins with academia or with real-world experience. It is possible to become wealthy with only a high-school diploma; it is just a lot less likely. (See Investopedia’s tutorial, All About Student Loans – particularly Earn Credit Card Rewards for Paying Student Loans – if you decide to go the college route, or read: How To Ask Your Employer To Fund Your Education.)