My alma mater, a private midwest college with a strong arts program, recently announced that it is raising tuition to $30k a year. While this is quite high, other private schools in the area also announced tuition hikes… The University of Chicago raised tuition to 4% to $55,416 for 2011-2012 and beyond.
At least the students at The University of Chicago have high odds to earn back their extremely high tuition fee… but what about the others of us who are not Ivy League material? Is it worth it to pay $100k – $250k for a college degree?
We were raised to think YES, but some are now arguing the opposite. In The Atlantic, Professor X returns to further on his original controversial article “In the Basement of the Ivory Tower: University education for everyone is a destructive myth.” Professor X is a professor at a “college of last resort,” he calls it. In 2008, he wrote:
“I wonder, sometimes, at the conclusion of a course, when I fail nine out of 15 students, whether the college will send me a note either (1) informing me of a serious bottleneck in the march toward commencement and demanding that I pass more students, or (2) commending me on my fiscal ingenuity—my high failure rate forces students to pay for classes two or three times over.
What actually happens is that nothing happens. I feel no pressure from the colleges in either direction. My department chairpersons, on those rare occasions when I see them, are friendly, even warm. They don’t mention all those students who have failed my courses, and I don’t bring them up. There seems, as is often the case in colleges, to be a huge gulf between academia and reality. No one is thinking about the larger implications, let alone the morality, of admitting so many students to classes they cannot possibly pass.”
According to the US Department of Labor, in October of 2009, over 70% or high school graduates were enrolled in some form of college. This number has seen a huge increase since the US Department of Labor began keeping statistics in the late 50?s. The previous year saw an all time high of college student enrollments. In October of 2008, nearly 40% of all people between the ages of 18 and 24 were enrolled in college, either 2-year or 4-year programs. But just because enrollments are going up, doesn’t mean academic quality of the student body is increasing…
“…I was teaching many students who weren’t prepared to do even high school work. I was expected to coax critically reasoned research papers from students who possessed no life of the mind at all: young and not-so-young men and women who didn’t read and thought not a whit about ideas. I couldn’t shake the sense that the college simply wanted to enroll as many students as possible – and that colleges in general had become more focused on the bottom line than in my day.” — Professor X
I’m torn over my opinion on whether “everyone” should get a college degree. On one hand, I look at people like myself and my sister — both not Ivy qualified — but that are thriving with a college education. While my high school report card had a few As from my art classes and electives, most of my academic grades were Cs and low Bs. Perhaps I shouldn’t have gone to college… but I did, and without my college degree I’d never be where I am today. But I also work in a field for an industry that often only seriously considers Stanford and Harvard grads, so without a college degree I’d be totally screwed.
My sister, however, is pursuing an entirely different field — outdoor recreation. Yes, her major is Outdoor Recreation. She has a learning disability and while she’s quite bright, my parents, especially my father, didn’t think she should go to college. She proved him wrong, first going to a college with special help for learning disabilities, and recently transferring into a regular state school with other “normal” kids. And she’s doing as well as those other kids. Does she need a college degree to work at a rock wall gym? Probably not. But having the college degree is going to give her options later in life that she wouldn’t have without it.
Meanwhile, there are also a lot of kids out there who just shouldn’t be in college. My sister, while she struggles with academics, is extremely motivated. She studies all the time. She likes to prove everyone wrong about her abilities. There are a lot of kids who just don’t care, who are in college because that’s what their parents want them to be doing… and it’s a better option than working full time at the supermarket straight out of high school.
The problem is that — for many kids — our elementary schools, middle schools and high schools are failing them academically. My roommate is a middle school teacher in a California public school, and unlike the other teachers, she grades her class very harshly. The town she teaches in is filled with Asian and Indian students, so it turns out they are brilliant at memorizing and regurgitating information, but not the best at writing papers with original ideas. She fails some of her 6th graders for poor report writing. She teaches history, not English. It’s tough love.
But most teachers don’t want to play the tough love card, or they’ve given up because it’s too difficult, esp for the pay they receive. My roommate spends a large amount of her “free time” carefully grading papers, commenting on these papers, and teaching her students how to write. She’s a rarity in the school system, and since she’s still fairly young and new to teaching she often gets pink slipped and loses her job… just because teachers are kept on for being at a school the longest, not for actually teaching.
For all students, though, there is always an option that is a stretch for your abilities, and with that comes a higher cost that may or may not be worth paying. For the student who just doesn’t like to be educated, there are community colleges and private schools willing to take just about everyone. For the bright, there are the highly-prized private schools of all sizes that accept only a handful of students that apply, and have a price tag that makes you wonder why anyone applies. For all of these students, would it be better to “round down” academically vs. rounding up?
Writing in April in the Journal of Labor Research, three researchers argued that “an exclusive focus on the economic outcomes of college graduation, and from prestigious colleges in particular, neglects a host of other employment features.”
Mining a sample of nearly 5,000 recipients of bachelor’s degrees in 1992 and 1993, who were then tracked for nearly a decade, the authors concluded that “job satisfaction decreases slightly as college selectivity moves up.”
Surely, if you (or your parents) are paying $200k for a degree, that creates an added sense of stress and expectations for your post-diploma career. If you had to take out loans to pay for the degree, this stress is much greater. But at least for folks with Ivy-league or equivalent degrees, the career and graduate school options are wide open. There’s still a lot of employers out there who won’t look at you if you don’t have a degree from a prestigious school. I’m even hiring for an internship position at my company — to work under me in my department — and my boss has told me that I should try to hire for this role from an elite school. So perhaps the excess cost is worth it.
But, back to the many kids out there who don’t even want to be in school, who are forced into higher education because — what else would they do? Late last year, a great article was written about this in The Washington Post titled “some say bypassing higher education is smarter than paying for a degree.”
“You’ve been fooled into thinking there’s no other way for my kid to get a job . . . or learn critical thinking or make social connections,” hedge fund manager James Altucher says.
Altucher, president of Formula Capital, says he sees people making bad investment decisions all the time — and one of them is paying for college. College is overrated, he says: In most cases, what you get out of it is not worth the money, and there are cheaper and better ways to get an education. Altucher says he’s not planning to send his two daughters to college. “My plan is to encourage them to pursue a dream, at least initially,” Altucher, 42, says. “Travel or do something creative or start a business. . . . Whether they succeed or fail, it’ll be an interesting life experience. They’ll meet people, they’ll learn the value of money.”
An Ivy League alum and hedge fund manager, Altucher is wealthy enough to support the anti-college experiment for his kids. But it turns out that he learned the hard way about just how expensive — and wasteful — higher education can be. Graduating with a computer science degree, he paid his way through college working 60 hours a week on top of his course load, graduating $10k in debt, and then ultimately teaching himself how to become a hedge fund manager, with some hard real life lessons investing his money, losing it, and getting it back.
Is the cost of four or even five years of college more valuable than four to five years of trial and error at the game of life? Here’s a fact that makes that $200k tuition seem absolutely absurd… $200,000 earning 5 percent a year over 50 years would amount to $2.8 million. Or, as Altucher advises, give your kids $10k to start a business instead of paying for their schooling. They’ll learn much more than they would in the university environment in terms of how to make money in real life.
This isn’t just for those elite school type kids… for the teens that are in college because they aren’t sure what else to do, that maybe isn’t the best use of their money. According to a report in the Chronicle of Higher Education, 31 percent of loans made to community college students are in default. (The same report found that 25 percent of all government student loans default.)
On the other hand, Education Department numbers show that a college degree can equal more income over the course of one’s life. In 2008, the median annual earnings of young adults with bachelor’s degrees was $46,000; it was $30,000 for those with high school diplomas or equivalencies. This means that, for those with a bachelor’s degree, the middle range of earnings was about 53 percent more than for those holding only a high school diploma.
As the Washington Post piece notes, if you’re an engineering major, that college degree may very well be worth it. If you’re an anthropology major, well, probably not.
The unemployment rate among those with bachelor’s degrees is at an all-time high. In 1970, when the overall unemployment rate was 4.9 percent, unemployment among college graduates was negligible, at 1.2 percent, according to the Bureau of Labor Statistics. But this year, with the national rate of unemployment at 9.6 percent, unemployment for college graduates has risen to 4.9 percent — more than half the rate of the general population.
While I was fortune enough to have my parents pay for my college tuition, looking back it would have probably made sense for me to go to the state school I was accepted to — for about $10k per year, vs the private school in Chicago I had my heart set on for $28k a year. If I had graduated with debt, I wouldn’t have had the opportunity to take so many risks, work for such low pay (or no pay at times) and eventually work it all out. If I had loans to pay back I’d be stuck living at home and working whatever job would pay the most withing a commutable radius.
And whoever says you can’t be successful without a college degree has forgotten that the most successful people today have gotten there without a degree… But what about the lessons offered by the success stories that have unspooled along a different path? Dropouts are the toast of the dot-com world. The non-degreed billionaires’ club is headed by Microsoft’s Bill Gates (Harvard’s most famous quitter) and Apple’s Steve Jobs (left Oregon’s Reed College after a single semester), add: Michael Dell (founder of Dell Computers, University of Texas dropout), Microsoft co-founder and Seattle Seahawks owner Paul Allen (quit Washington State University) and Larry Ellison (founder of Oracle Systems, gave up on the University of Illinois). David Geffen, co-founder of DreamWorks, bowed out of several schools, including the University of Texas. Redskins owner Daniel Snyder dropped out of the University of Maryland. Barry Gossett, chief executive of Baltimore’s Acton Mobile Industries, builders of temporary trailers, also left Maryland without a degree.
Perhaps for many of us, it’s better to attack the real world, versus spending tens of thousands of dollars on a degree that proves, well, that we need others to teach us what we could be teaching ourselves.