First, let’s take a look at the value of college from an economic (earnings) and “opportunity” angle. When you search the Web for answers to the query “Is college worth it?” you get the usual avalanche of responses. I chose two from the “About 465,000,000 results [found in] (0.32 seconds).” The first is by Jill Schlesinger, business analyst at CBS News. Her article’s thesis states:
As the Class of 2014 throws their caps into the air during this graduation season, many graduates must now face the stark reality of a mound of education debt. Given the still-tough job market, many families continue to wonder whether college is worth it. The answer is yes, with a caveat.
What’s the caveat?
… don’t go into hock up to your eyeballs — and parents, please don’t raid your retirement accounts and borrow against your home — to do so.
That makes sense, obviously, but easier said than done, in my view. Anyway, what are some of Schlesinger’s worth-it points?
– … the unemployment rate for young college graduates stands at 8.5 percent, much lower than the 22.9 percent for high school graduates.
– … household income of young adults with college loans is nearly twice that of people who didn’t attend college ($57,941 vs. $32,528).
– … a new study from the Federal Reserve Bank of San Francisco shows that the average US college grad can expect to earn at least $800,000 more than the average high school graduate over a lifetime …
– … Priceonomics blog pegs the 30-year wage premium at $200,000 of extra income ($6,667 a year) compared to that of a high school graduate’s salary.
– Researchers at Georgetown predict that in the next six years, the share of jobs requiring post-secondary education will likely increase to 64 percent by 2020 …
Need more convincing? Let’s extract the main pro-college points from Anthony Carnevale’s testimonial about college’s worth.
Anthony’s opening salvo is blunt and forceful:
Those who make the “skip college” argument often bolster their arguments with official state and national Bureau of Labor Statistics (BLS) data suggesting that the U.S. higher education system has been turning out far more college grads than current or future job openings require.
To a public wary of paying steep tuition bills in a depressed economy, it all sounds alarming and — with the backing of national and state government BLS data — authoritative.
There’s just one problem with the official BLS statistics: they’re wrong.
He provides a detailed rationale for his position on that and then goes on to categorize his reasons for a college education. Here are the bullet points. You can take in all the details yourself.
– There is a better explanation for the puzzling official data that suggest we are producing too many college graduates: Official education demand numbers have serious flaws.
– Technology drives ongoing demand for better-educated workers … Wage data show that employers have tended to hire workers with postsecondary credentials for these more complex positions — and pay a wage premium to get them.
– Spate of media stories on value of college fuels needless fears … Stories on the value of college tend to follow the business cycle, and when the cycle is down, journalists often find it easy to write a story that bucks the conventional wisdom.
– College is still the best safe harbor in bad economic times … while it is true that the sticker price cost of going to college has risen faster than the inflation rate, the college wage premium has risen even faster, both in terms of the cost of going to college and the inflation rate.