Educational Attainment and the Evolution of Cumulative Earnings across 45 US Birth Cohorts 
Educational attainment strongly predicts earnings and labor market participation, yet data constraints have historically limited research on lifetime earnings gaps across education groups. This paper leverages newly available administrative longitudinal data to conduct the first comprehensive analysis of long-term cumulative earnings across 45 US birth cohorts and education levels. The authors examine both 20-year cumulative earnings—decomposing contributions from the intensive margin (earnings when employed) and extensive margin (years worked)—and earnings dispersion within education groups. The findings reveal how shifting labor supply and demand have generated divergent earnings trajectories for successive birth cohorts across education levels and genders.
Key Findings
- Men with an advanced degree experienced the strongest earnings growth across birth cohorts, while those with a sub-baccalaureate education—and bachelor’s-degree holders outside the 1951–1965 cohorts—saw largely stagnant earnings.
- Women at all education levels, but particularly those with a bachelor’s or advanced degree, experienced robust earnings growth.
- Increases in years worked, driven partly by Social Security retirement age changes, represent a critical earnings growth source for less educated workers in late career (ages 45 to 64).
- Differences in long-term labor market attachment can generate substantial compounding inequalities both within and across education groups. These dynamics are obscured by cross-sectional data.
- Earnings inequality rose both between and within education groups across cohorts. These cohort-to-cohort differences emerged at labor market entry and remained stable throughout the career cycle.
Implications
The paper documents intensifying lifetime earnings stratification by educational attainment, with economic gains increasingly concentrated among the most educated workers. Rising within-group inequality, particularly among men with a bachelor’s or advanced degree, further indicates that higher education’s economic returns have become more dispersed. Critically, both widening education premiums and growing within-group inequality emerge when newer cohorts enter the labor market. This pattern suggests that early-career mechanisms, such as skill specialization, occupation choice, and initial sorting across industries and firms, are key drivers of long-run inequality trends. Because initial earnings disparities persist throughout workers’ careers, interventions targeting human capital development and early-career opportunities may have lasting effects on lifetime earnings inequality.
Abstract
Educational attainment profoundly shapes cumulative earnings trends across US birth cohorts. Between the 1933 and 1977 cohorts, men with an advanced degree experienced rising earnings in both the early-career (ages 25 to 44) and late-career (ages 45 to 64) stages, while those with a sub-baccalaureate education―and college graduates outside the 1951–1965 cohorts―saw minimal earnings growth. Women experienced broad-based gains, with larger increases among those with a bachelor’s or advanced degree. For less educated men, extended work life represented the primary growth margin in the late-career stage. While gaps between education groups widened, within-group dispersion rose across cohorts, particularly among men born between 1933 and 1957. These cohort-to-cohort changes emerged at labor market entry and persisted throughout the career cycle, indicating that the conditions in which careers begin critically shape long-run inequality dynamics.