Equal Returns, Unequal Outcomes: How Education Reproduces the Racial and Gender Earnings Gap

<p>Education is widely assumed to function as "the great equalizer" — a mechanism through which inequality of birth is overcome. This study tests that assumption by examining whether the returns to education close racial and gender earnings gaps or reproduce them. Using pooled data from the General Social Survey (2016–2024, N = 6,151) and a survey-weighted interaction model, I distinguish between equal returns (credentials raising earnings by the same proportion for all groups) and equalizing returns (credentials closing the gap between groups). I introduce the concept of credential suppression: the labor market suppression of a credential's value by suppressing the value of the person who holds it, along lines of race and gender. Results show that Black men with bachelor's degrees earn amounts statistically indistinguishable from white men with only a high school diploma. Returns to education are not significantly differential for Black men and, where differential for white women and Black women, are not compensatory enough to overcome baseline penalties of 49 to 67 percent. The earnings gap persists within the same fields of study and survives controls for family background. For Black men, a bachelor's degree would need to return 2.5 times what it returns for white men to reach parity. It returns less. These findings challenge the premise underlying both the Supreme Court's decision in Students for Fair Admissions v. Harvard (2023) and Executive Order 14173 (2025), which ended affirmative-action requirements for federal contractors: that neutral treatment of credentials produces neutral outcomes. Equal returns do not equalize. They reproduce the gap at every education level.</p>