College Still Pays Off

July 1st, 2011 at 7:21 am | 6 Comments |

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This is the first part in a FrumForum series on the value of college written by FrumForum’s summer interns.

Recently, there has been a flurry of articles suggesting that the value of a college education is decreasing. James Altucher, one of the crusaders at the forefront of the anti-college movement, has said that college is nothing more than a “scam.” The arguments against the importance of college say that it is too expensive for what it is: that it is impractical and unhelpful in the real world. These arguments are deeply flawed.

The fact of the matter is that it is a rough economy, and not every single graduate is going to be able to find a job worthy of a college grad.  Thus, the horror stories that populate the media about people with Ivy League degrees scrubbing toilets and tending bars.

However, the simple truth is that whether or not it is a tough job market, college grads will come out ahead financially. The data shows that college graduates consistently get more skilled jobs and earn more than non-college grads. Between 1983 and 2008, the inflation-adjusted median wage for people with bachelor’s degrees increased by 34 percent, while the wages for high school dropouts fell by 2 percent.  And, by 2007, 48% of people with bachelor’s degrees were in the top three deciles of income.

The United States Bureau of Labor Statistics reported in 2007 that people with college degrees earn an average of $937 per week, while people with only a high school diploma earn only $583 per week.

Paying for college is an investment in the student, and the value of a degree is such that it greatly increases the probability that he or she will be able to return on that investment.

However, in a further jab at the college system in America, Altucher said that many argue that college teaches you how to network, write, and think, but “personally, [he] didn’t learn how to do any of those things in college.”

Maybe Altucher wasted his time during his four years at Cornell, but it is unfair of him to apply his own experience to every American college student. As a rising college sophomore, I have already made connections through my school that will help me land summer internships and future employment. As an English major, I am not only learning how to write analytical essays but how to think critically as well. These shifts in the way I approach my learning and my future have a value in and of themselves which should not be underestimated.

But, for the skeptics, higher education is not important simply for the education itself, but also for the economic opportunities it presents. College is not a “scam” as Altucher asserts, because the knowledge gained during those defining four years is not worthy only for the sake of crystallized intelligence, but has real implications for monetary success later in life.

Recent Posts by Tessa Berenson



6 Comments so far ↓

  • llbroo49

    Ask Altucher how many non-college grads he has hired to fill professional/ executive positions.

  • Banty

    This anti-college movement, like a lot of these regressive movements we’re seeing nowdays, is taking a small grain of truth, then streeetttccchhhiiinnnggg it to cover quite different concerns.

    Yes, not everyone should go to college (and I would even go as for to say, not everyone smart has to go to college.) Yes, there has been a disconnect between what college costs and what some college grads can actually recoup enough to pay off the college loans. Especially concerning certain for-profit colleges. And I do think there needs to be a re-assessment of Pell grants and similar programs as to what they may be enabling other than a well educated populace.

    But then this little red wagon of truth, gets hitched onto the big SUV of anti-intellectualism,
    “The Bell Curve” incipient racism, and perhaps even a corporatist desire for a working force just well enough informed to perform the tasks, but not quite informed well enough to question the soft but persistent propagandas put out by their employers via PACs, lobbies, certain captured think tanks, and certain media outlets.

  • PracticalGirl

    Tessa:

    A degree can be very important, and you are definitely arguing that position. But I tend to think that the problem is the mentality that college-straight out of high school- is the best decision for all high school graduates. It’s the thing that colleges sell and parents and kids buy. It’s the reason that 80% of high school graduates headed to some form of college last year.

    Still, the facts: 70% of all kids who enter college do NOT have their degree by age 27, and it’s been this way for well over a decade. I don’t think college is a “scam”,but I also think it isn’t necessarily for everybody- and the facts tend to support this . I also wonder- what other business could show a 30% success rate and continue to raise prices (and encourage massive credit to obtain their services) and increase customers? Further, just under 50% of the jobs being created now (and projected to 2018) will NOT require a 4 year degree, yet the message coming from 4 year institutions is “Don’t attend at your peril”.

    It might help your understanding of the sentiment if you’d do a bit of research into what’s really happening within the business of post-secondary education.

  • sinz54

    PracticalGirl: “I also wonder- what other business could show a 30% success rate and continue to raise prices (and encourage massive credit to obtain their services) and increase customers? ”

    ANSWER: Any business in which there are major barriers to entry, enabling existing firms to raise prices without fear of competition.

    How many new universities have been founded in the United States in the last 20 years?
    HINT: A lot fewer than the number of new day-care centers or medical clinics.
    I’ll bet you can’t even name the newest universities in the United States. I couldn’t either, until I did some research.

    If the Federal Government really wanted to do something to make education more affordable and practical, they would stop handing out largesse to public school teachers’ unions and provide seed money to encourage the startup of at least 30 new universities and engineering colleges.

    And those new universities and engineering colleges should be located in those parts of the country with the fastest rising populations (mostly in the South and West). These new universities could charge reduced tuition, which would undercut what Harvard or Yale can charge. I’ll bet a Republican candidate like Romney would go for that.

  • Xunzi Washington

    The best private school in my area, which is ranked regionally in the top 10, costs 20K a year, without room and board. The flagship public college in my state costs 8.5 a year for in-state tuition, without room and board.

    That’s 80K for a very good private and 34K for the flagship public. The arguments claiming that college isn’t worth it always throw out the “200K” number. Where’s 200K coming from? And, of course, this “200K” number also comes with another set of (false) assumptions, like ignoring that not more than a tiny fraction of students actually wind up paying full tuition any way, after scholarships, various discount rates offered by colleges and government subsidies.

    If you are going to argue the point, at least argue it against the scenario that just about all people deal with. In this case, ask:

    1. For wealthier parents: is 80K worth it to send your kid to a good private school?
    2. For not as wealthy parents: is 32K worth it for the flagship public university?

    We should add to this that in my state, if a student graduates with a certain GPA and has a certain ACT score, they get to go to a local community college for FREE. From there, they can transfer to either of (1) or (2), both of which would gladly take the student assuming that student kept up their studies.

    So for the motivated student/parents, now it would be:

    1a. Is 40K worth it to send your kid to a good private?
    2a. IS 16K worth it to send your kid to the flagship?