Does the Attained Level of Education Affect the Income Situation of Households?

Abstract

An increasing number of inhabitants with higher levels of education provide conditions for formation and development of knowledge or information society. In this society, the significance of education is increased and the utilization of scientific findings becomes the key source of the society's competitiveness. However, does the attained education affect the income situation of a household? The paper provides results of an analysis focusing exactly on relationship between attained level of education and the income situation of households in the Czech Republic, mainly those ones living at risk of poverty. The source for the analysis of the effect of achieved level of education on the income situation of households are the results of a survey conducted by EU-SILC (European Union Statistics on Income and Living Conditions) in 2005-2009. The level of education of a household was determined based on the level of education of the household member with the highest income - the head of household. The income situation is determined by mean and median values, differentiation and development between 2005 and 2009, representing the period of economic development but also economic crisis. The results of analysis of households categorized by education level and their risk of poverty clearly show that the most vulnerable group comprises households with primary education or no education. At the same time, when analyzing the mean disposable income per member in households at risk of poverty; it was found that the households with lowest income are rather surprisingly the ones headed by a person with the highest level of education (tertiary). The connection of income inequality and poverty of economically weak households and attained level of education has been proven; however, we can conclude that a higher level of education of the head of a household is no guarantee of a lower risk of poverty and more and more attention should be paid to the applicability of university graduates in practice.