Master's Degrees in Social Work and Psychology Face Low ROI Despite High Demand

Master's degrees in social work and mental health counseling are expected to see significant job growth over the next decade, yet graduates often face low returns on investment due to relatively modest salaries. The Bureau of Labor Statistics projects that social work job openings will increase by 74,000 positions annually from 2024 to 2034, while mental health counselor roles are expected to add 48,300 openings per year. However, the median annual wage for social workers is $61,330, and mental health professionals earn below $60,000, according to BLS data. A new study from American University's Postsecondary Education and Economics Research (PEER) Center found that master's of social work programs have an average cost-adjusted return of -2%, while clinical psychology and psychology programs show -5% and -8% returns, respectively. Personal finance expert Robert Farrington warns that students should carefully consider the financial implications of these programs. 'It's going to be how your financial life looks for the next 10 to 20 years after you're done with the program,' he says. 'If you spend a lot of money and [get into] a lot of debt, you're going to have to deal with the consequences of that once you enter that field.' Tiffany Llewellyn of New York University's Silver School of Social Work acknowledges the financial challenges but emphasizes the broader value of these careers. 'There is passion, there is hope [students] hold for our humanity. There is purpose around the impact that students want to have that drives their pursuit of a social work degree,' she says. Llewellyn also notes that salaries can vary significantly by location, with social workers in Hawaii, New Hampshire, Nevada, Rhode Island, and the District of Columbia earning median incomes above $100,000. Despite concerns about low pay, Llewellyn argues that the field offers diverse opportunities beyond traditional roles, including positions in hospitals, schools, private practices, and tech companies. 'I think the concept of social workers being underpaid is outdated, but also dependent on the demographic realities and the perspective someone holds about who a social worker is and what they do,' she says.