1 Illustrating the increased earning potential from your AA degree SSAC2007.LB2328.YS1.1 Calculating Difference in Wages for a Book- keeper (with AA Degree) vs. a Cashier (No College Degree) What’s the Difference? Prepared for SSAC by Yilin Sun - Seattle Central Community College © The Washington Center for Improving the Quality of Undergraduate Education. All rights reserved Supporting Quantitative Concepts Number skills: Sum Number skills: Subtraction, addition multiplication Number sense: Comparison Contrast Visualizing data: Bar graphs Core Quantitative Issue Number Operation

2 Slide 3 The Problem Statement Slide 4 Background information Slides 5-7 Creating a Chart of Income Comparison Steps Slides 8-9 Creating Bar Graphs Slides End of Module Assignment Slides 13 Pre-Post Tests Overview of Module This module will provide you with opportunities to learn and use Excel to create a spreadsheet comparing the income between two jobs over a period of ten years. You may be amazed at what you will discover.

3 LiYa’s Dilemma What are the differences in annual income between the two jobs and over a period of ten years? Is it worth getting a college degree assuming she’ll have to work part-time to pay for her tuition and other related educational cost? LiYa is a 21-year-old ESL student at a community college. She is not sure if she wants to go to college as she already makes $11/hour as a cashier in a local grocery store. She works 40 hours a week mostly on weekends and evenings. Her annual wage is about $21,120 with no benefits. She is thinking about becoming a bookkeeper and the counselor tells her that the average wage for an entering level book-keeper/accounting clerk in Washington state is $17.03 an hour and the annual average salary is $35,420 with full benefits based on the US Department of Labor 2006 statistics ( It will take her two years to earn an Associate of Applied Science (AAS) degree. The tuition and fees for a two-year degree program in Seattle area typically cost about $2,850 per year for a full-time student. She may have to give up her cashier's job or work part-time while studying full-time for two years.

4 A newspaper column that appeared on Labor Day, 2007, includes the following information about average wages in the U.S. from Elaine Chao, the U.S. Secretary of Labor: With the new school year starting, students need to be aware that high school dropouts make about $522 per week for full-time work and their unemployment rate is about 7.1 percent. Meanwhile, workers with a high school diploma average $704 weekly, and this segment of the work force has a 4.4 percent unemployment rate. Workers with associate degrees average about $846 per week, and this group’s unemployment rate is 3.5 percent. But workers with a bachelor’s degree or higher average $1,393 per week and have an unemployment rate of 2.1percent. -Elaine Chow, “Take a bow work force,” St. Petersburg Times, Sept 3, 2007, p. 15A © 2007, Distributed by McClatchy-Tribune Information Services Background

5 Create a Chart of Income Comparison Step 1 Open a new Excel worksheet, in Cells B3, B4 and B5, type Hourly Rate, Weekly (40 hrs), Annually In Cells C2, D 2, and E2, type Cashier, Book Keeper, Difference. In Cells C3 and D3 type $11 and $ To get the weekly wage for Cashier, in Cell C4, multiply the value in C3 by 40. To get the annual wage for Cashier, in Cell C5, multiply the value in C4 by 48. Do the same for the Book Keeper’s weekly and annual income. To calculate the difference between the hourly rates of the two jobs, in Cell E3, subtract the value in Cell C3 from the value in Cell D3. Copy Cell E3 and paste it in Cells E4 and E5 to get the differences for the weekly and annual income. You will build a table like the one below. = cell with a number in it = cell with a formula in it

6 Create a Chart of Income Comparison Step 2 The next step for you is to build the table to illustrate the difference in income over ten years between the two jobs. In Cell B9, type Number of Years, and enter 1 through 10 in Cells B10 through B19. In Cell D8, type Total Income Over Ten Years. Type Cashier, Book Keeper and Difference in Cells D9, E9 and G9. In Cell D10, multiply Cashier’s annual income $21,120 by the value in Cell B10. Then, copy the content in D10 and paste it in Cells D11 to D19 to get the total income over ten years. Apply the same procedures for Book Keeper. To calculate the difference in total income over the years, in Cell G10, subtract the value in D10 from E10 and paste it to Cells G11 to G19. You will get the table like the one below. If you would like help creating formulas for this spreadsheet, see Slide 7.

7 Steps to create Excel formulas To perform subtraction in Excel, you need to create a subtraction formula. For example, if you subtract the value in Cell C3 from the value in Cell D3, your formula will be “=D3-C3”. To perform multiplication in Excel, you need to create a multiplication formula. For example, if you’re multiplying the value in Cell D4 by 40, you will type “=D4*40”. The symbol * is called asterisk. To add the values in consecutive cells, you need to use the SUM formula. For example, to add the values in consecutive cells D1, D2,D3,D4, D5, your formula will be “=SUM(D1:D5)”. The colon tells Excel that you will be adding D1 to D5 including all the cells in between. To perform addition, i.e., to add values in two cells, you need to create an addition formula. For example, to add the values in D1and D2, the formula will be “=D1+D2”. Perhaps this is your first time trying to perform numerical operations on an Excel worksheet. Here are suggested steps for you to follow:

8 Instructions for Creating a Column Graph- Income Difference of the Two Jobs Open your completed spreadsheet. Click on your spreadsheet and highlight the three cells: Cashier, Book Keeper, Difference Click on the chart wizard in the middle of the tool bar. Under Chart Type, choose ‘Column graph’, then choose the top right “Column Graph” option. On the next screen, click ‘Next.’ On the next screen, type in the title Income Difference in Ten Years. Change Series with the proper names, e.g., Cashier, Book Keeper, Differences. Click “Next” then, ‘Finish.’ Last, right-click on the chart you have made. Be sure to save your chart. The final graph will be like the one on the left. Chart of Income Differences of a cashier and a Book-keeper in Ten Years $115,776 We can also use Excel to show the difference in total income over ten year that was calculated in the spreadsheet in slide 6 in a chart.

9 Income Difference in Ten Years Assume LiYa spends two years in college earning her AA degree. The cost to her would be her cashier’s wage at $21,120 per year and her tuition and fees at $2,850 per year. The cost of attending one year college would be: $21,120 + $2,850 = $23,970. The total cost for two years of college would be: $23,970 × 2 = $47,940. However, after graduation, within 10 years, she would earn $115,776 more in her new job. Subtract the cost for the two-year college education from the additional salary she would earn as a Bookkeeper: $115,776 - $47,940 = $67,836. We get the net gain of $67,836 from her new job as a Bookkeeper. Is it worth getting a college degree? Are there other benefits for getting a college degree in addition to income?

10 Jose came to Seattle two years ago and has been working as a custodian making $8.5/hour. He works 40 hours a week from 8pm to 4 am, five days a week. He is thinking about becoming a Para Educator. He went to the college Career Center and learned that a Para Educator earns 13.85/hour. It will take him two years to get an AA degree in Early Childhood Education. Use the spreadsheet you developed for Liya’s choice to advise Jose if he should get an AA degree in Early Childhood Education. End of Module Assignments - Question 1: Making a decision for Jose = cell with a number in it = cell with a formula in it

11 End of Module Assignments - Question 2: Work with a partner and use an Excel spreadsheet to create a chart to calculate the weekly, monthly and annual income of the two jobs. Now, look at the slide 8 of a Column Graph showing the income difference between a book-keeper and a cashier. Create a similar graph to illustrate the income difference between Jose’s current job as a custodian and a Para Educator. (See slide 7 for steps to build a column graph.)

12 End of Module Assignments - Question 3: Write a short essay to summarize the findings and your advice to Jose if he should get a college education.