Archive for ‘graduate school’

June 17, 2014

Proliferation of master’s degrees produces wasteful ‘credential inflation’

by Grace

The master’s degree is the fastest-growing college credential in this country, but is that a good thing?

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Eight percent of the population now holds Master’s degrees, the same percentage that held bachelor’s degrees (or higher) in the 1960s, reports Vox. Master’s degrees in education were by far the most popular, holding at around a third to a quarter of all such degrees from 1971 to 2012, though MBAs had taken the top spot by 2010. In fact, the increase in the number of MBA degrees is astonishing: Only 11.2 percent of master’s degrees were in business in 1971, but in 2012, they were a whopping 25.4 percent.

This “credential inflation” is “in large part driving the student loan crisis”.

The rise of the master’s degree is likely a product of credential inflation. As more and more people acquire bachelor’s degrees, those who wish to make themselves stand out go on to get the MA. And as Vox points out, while a Master’s degree does have a positive impact on earnings, the overall debt of people with undergraduate and Master’s degrees has grown markedly in the past decade. In fact, as we recently noted, graduate student debt is in large part driving the student loan crisis.

The recently expanded loan forgiveness program is “tailor-made for graduate students”.

Students who took out big loans for graduate school and those with higher incomes stand the most to gain financially under President Obama’s expansion of the federal government’s loan forgiveness program.

Lawyers, doctors and other highly trained professionals who utilized federal loans throughout their post-high school education could walk away with most or all of their graduate school debt forgiven by the federal government under the program, say experts.

Is this good for our economy?

… But we shouldn’t want an economy that favors people with polished résumés over people with good ideas. This data is not a good sign for our economic health.

It seems to be another case where excessive government intervention has created inefficiencies resulting in unintended consequences

Public support for higher education helps to create unnecessary barriers in many fields where advanced degrees are now required credentials. … Neal McCluskey argues that “cheap college has almost certainly fueled credential inflation, not major increases in knowledge or skills.”

ADDED 6/17/14:

Advanced degrees don’t generally improve student achievement levels.

A number of studies have shown that teachers with advanced degrees don’t, necessarily, produce higher student achievement than teachers who hold only a bachelor’s….

One study from the Center for American Progress reported “that states waste money by giving salary increases to teachers as a reward for getting a master’s degree, spending nearly $15 billion annually on such pay hikes”.

———

Randy Olson, “College degrees awarded per capita in the U.S.A.”, Randal S. Olson, June 12, 2014.

Walter Russell Mead, “The Rise of the Master’s Degree”, The American Interest, May 22, 2014.

Susan Ferrechio, “The surprising winners of Obama’s student-loan program”, Washington Examiner, June 12, 2014 .

Tyler Durden, “Unintended Consequences Of Obama’s Student Loan Policies”, Zero Hedge, June 13, 2014.

Ida Lieszkovszky, “Liberal Think Tank says Advanced Degrees Don’t Make Better Teachers”, StateImpact Ohio, July 18, 2012.

October 9, 2013

Second-tier status can mean second-tier salary for grad school

by Grace

The decision to go on to get a graduate degree should be made with specific career goals in mind.  Among other factors, a school’s reputation affects post-graduate job opportunities and salary.  From a MarketWatch story titled “10 things grad schools won’t tell you” comes this advice.

“Our second-tier status may hamper your career — and your pay.”

“The name of your school matters a lot,” says Katie Bardaro, lead economist for PayScale.com, a website that compiles compensation data. Indeed, salaries can be much higher for grads of top schools, especially for people getting M.B.A.S and law degrees, says Bardaro. Data from PayScale shows that the median pay for M.B.A. grads two years after graduating from the University of Pennsylvania Wharton School is $125,000 a year, growing to $167,000 by the time they were 10 years out of school. M.B.A. grads from the less highly regarded University of Massachusetts Boston Campus earn a median $62,300 annually two years out of school, and that pay grows to $75,400 when they’re 10 years out. The University of Massachusetts didn’t respond to requests for comment.

People considering graduate school who don’t want to attend or can’t get into or afford a brand-name school should look for schools with notable alumni in their industry, says Bardaro. Such alumni might bring cachet to a school that isn’t necessarily Ivy League, says Bardaro. And if the program has a strong track record of placing people in a certain industry, that could also boost the student’s chances of finding a well-paying job, she says.

When my husband was deciding where to go for his MBA, one of the most important factors was a school’s reputation for helping its graduates find employment in specific sectors and locations.  Given the recent devaluation of an MBA, today it’s even more important to determine carefully the return on the time and money for a business school education.

Here is some advice from Megan McArdle.

… When young people ask me whether they should get an MBA, I give them the same advice that I got in the late 1990s: unless you can get into a top 10* (or have a very specific job that you know you can get by attending a regional program), then don’t. You’re too likely to end up with massive debt and no very good prospects for paying it.

Related:

September 11, 2013

Harvard Business School gives itself a ‘gender makeover’ to ‘foster female success’

by Grace

Here is the problem, at least as perceived by many:

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As a way to close this gender salary gap, Harvard Business School set out to give itself a gender makeover, changing its curriculum, rules and social rituals to foster female success“.

It is an ambitious plan, intended  “to change how students spoke, studied and socialized”.

But in 2010, Drew Gilpin Faust, Harvard’s first female president, appointed a new dean who pledged to do far more than his predecessors to remake gender relations at the business school. He and his team tried to change how students spoke, studied and socialized….

Am I the only one who thinks this sounds a little creepy?

… The school saw itself as the standard-bearer for American business. Turning around its record on women, the new administrators assured themselves, could have an untold impact at other business schools, at companies populated by Harvard alumni and in the Fortune 500, where only 21 chief executives are women. The institution would become a laboratory for studying how women speak in group settings, the links between romantic relationships and professional status, and the use of everyday measurement tools to reduce bias.

Many of us are familiar with the gender wage gap, including the part about women often feeling they have “to choose between academic and social success” and that business schools see their graduates “part by gender after graduation, with more men going into higher-paying areas like finance and more women going into lower-paying ones like marketing”.

But I didn’t realize that a typical HBS female student had to “be taught how to raise her hand”.  Who knew that these best and brightest examples of high-achieving women were such wallflowers?  Apparently they need coaching on how to participate effectively in classes where men tend to take over discussions.

… Reach up assertively! No apologetic little half-waves! …

Women at Harvard did fine on tests. But they lagged badly in class participation, a highly subjective measure that made up 50 percent of each final mark. Every year the same hierarchy emerged early on: investment bank and hedge fund veterans, often men, sliced through equations while others — including many women — sat frozen or spoke tentatively. The deans did not want to publicly dwell on the problem: that might make the women more self-conscious. But they lectured about respect and civility, expanded efforts like the hand-raising coaching and added stenographers in every class so professors would no longer rely on possibly biased memories of who had said what.

Marianne Bertrand from the Chicago Booth School of Business recently gave a presentation that included a list of “documented robust gender differences in a set of psychological attributes”.

–Women are more risk averse
–Women negotiate less/women do not ask
–Women perform more poorly in competitive environments and shy away from such competitive environments
–Women lack in self-confidence (while men tend to be overly confident)

Even if the environment can be modified to promote more women into corporate leadership roles, Bertrand points out that policy responses will only be effective if we can confirm that these are learned behaviors.

… Innate or learned? nature vs. nurture?  …

Related:  Women who graduated from highly selective colleges more likely to drop out of workforce (Cost of College)

April 8, 2013

Gloomy outlook for radiologists

by Grace

“The times of graduating from medical school and driving a Porsche are done,” according to a radiology resident witnessing the gloomy outlook for his medical specialty.

At St. Barnabas Hospital in the Bronx, a dozen radiologists in training, including Dr. Luke Gerges, 28, are suddenly stranded on an expensive road to nowhere. All received termination notices recently because their hospital is ending their residency program next year as part of a plan to replace its radiologists with a teleradiology company that reads diagnostic images remotely.

“Those days of raking in the dough with radiology are gone,” said Dr. Gerges, who is four years beyond medical school and $300,000 in debt. He said he chose a specialty he loves without caring that big salaries were waning, but never imagined it would be this hard to finish his postgraduate training and get a job.

An unsustainable growth in costs has led to the remote reading of radiology images.

Starting in the 1980s, the advent of technology like M.R.I.’s and CT scans, combined with a fee-for-service system, created ballooning demand for imaging and drove the compensation of radiologists to unsustainable heights, he said. “That led to a sense of entitlement in some people’s minds,” he said. “And that led to this development of offshore remote reading of cases.”

By 2001, with the supply of radiologists limited by a 1997 Congressional cap on all Medicare-supported residencies, nighttime demand was unmanageable for smaller emergency rooms. So-called nighthawk radiology services began pooling the diagnostic imaging loads of several hospitals and transmitting them electronically to American radiologists stationed overseas or working from home.

Though outsourcing to India grabbed headlines, the big growth in teleradiology was domestic. Now the nighthawk companies, staffed by recent radiology graduates, are competing for the daytime work, too.

According to one hospital spokesman, remote reading may actually improve the quality of care as well as cut costs.

Other specialties are also seeing restricted growth.

Few specialties have been immune to the same factors depressing radiology: deep Medicare cuts, cut-rate competition driven by technology, doubts about the health value of many tests and procedures and new measures to tilt public money to primary care.

Meanwhile, nurse practitioners are projected to nearly double in number by 2025.

January 22, 2013

The MBA is no longer considered such a good deal

by Grace

First, the advice was, “Don’t go law school!”.  Now, it’s also, “Don’t go to business school!”  With stagnating salaries and surging debt levels, the MBA is no longer considered a certain path to financial success.

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The reasons are twofold according to Megan McCardle.

It strikes me as a real problem that more people are paying a lot for degrees that don’t necessarily boost their earning potential. It’s a symptom of two worrying economic trends: the relentless push for ever more educational credentials, and the stagnant labor market.

The MBA has been devalued, as pointed out in the Wall Street Journal.

A weak economic climate is only partly to blame for the M.B.A.’s plight. The changing nature of B-school programs, evolving corporate needs—as well as the perceived value of the degree—have all helped dilute the M.B.A.’s allure.

Formerly, the traditional M.B.A. was mainly the product of a full-time, two-year program. But beginning in the early 1990s, many schools created part-time and executive M.B.A. programs, with lower-ranked schools often following in the footsteps of academic leaders. Online degrees also gained in popularity.

As a result, the number of M.B.A. degrees granted has grown faster than the population, says Brooks Holtom, a management professor at Georgetown University’s McDonough School of Business.

“An M.B.A. is a club that is now not exclusive,” he says. “You should not assume that this less exclusive club is going to confer the same benefits.”

A change in hiring patterns indicates bachelor’s degrees are more in demand.

It is unclear how many M.B.A.s the market really needs. Recently, more companies have indicated that “they are moving away from an emphasis on M.B.A.s” and are instead hiring more undergraduates at lower salaries that they can then train in-house, says Camille Kelly, vice president of employer branding at Universum, a firm that advises companies on how to attract and retain the best employees. Companies, she says, “still will do M.B.A. hiring, but it won’t be to the same extent they have in the past.”

Advice from McCardle

… When young people ask me whether they should get an MBA, I give them the same advice that I got in the late 1990s: unless you can get into a top 10* (or have a very specific job that you know you can get by attending a regional program), then don’t. You’re too likely to end up with massive debt and no very good prospects for paying it.

Related:  ‘paper value of an MBA might be overstated’ (Cost of College)

July 9, 2012

Winners and losers in recent college student loan legislation

by Grace

Recent legislation saves $7 billion for some college students but creates $20 billion in extra costs for others.

Last-minute legislation to keep the subsidized Stafford student loan interest rate at 3.4% for at least one more year is estimated to save students approximately $7 billion, but the cost of other less publicized changes will cost them “roughly $20 billion”.

College students are facing a roughly $20 billion increase in the cost of their federal loans, despite a much-heralded deal in Washington to contain the expense of higher education.

Starting Sunday, students hoping to earn the graduate degrees that have become mandatory for many white-collar jobs will become responsible for paying the interest on their federal loans while they are in school and immediately after they graduate. That means they’ll have to pay an extra $18 billion out of pocket over the next decade.

Meanwhile, the government will no longer cover the interest on undergraduate loans during the six months after students finish school. That’s expected to cost them more than $2 billion.

These changes have received little attention as lawmakers instead focus on preventing a spike in interest rates on federal student loans. They are the fallout of earlier political battles and compromises over broader issues such as the federal budget and the national debt ceiling….

Another recent change cut the Pell Grant maximum eligibility period from eight to six years.

Related:  A roundup of pending federal college financial aid changes

January 2, 2012

No, no, no! – $200,000 in debt after a degree in communications

by Grace

It almost never makes sense to incur $200,000 in student loans so you can graduate with a master’s degree in communications.

In a story about young women dropping out of the work force to go to school, this anecdote about one student going for her master’s degree in strategic communications caught my eye.

“I was working part-time at Starbucks for a year and a half,” said Laura Baker, 24, who started a master’s program in strategic communications this fall at the University of Denver. “I wasn’t willing to just stay there. I had to do something.”…

… Including the loans that financed her undergraduate education at Wartburg College in Waverly, Iowa, she will complete her master’s program next year owing about $200,000 in debt.

“I have to have faith that I will eventually get a good job that pays enough to pay my living expenses and pay back my loans,” she said, “and hopefully make me happy in the process.”

To pay off a $200,000 student loan you need a $200,000 annual salary

According to this Georgetown University report on the economic value of college majors, the median salary of a worker with a master’s in communications is about $65,000.  Mind you, that average is for all levels of experience, so a new graduate just beginning her career should expect to earn less.  When Ms. Baker begins to pay down her $200,000 student loan after she graduates next year, her monthly payments can be expected to be about $1,775.  Here’s the cautionary language that accompanies the calculation results for that $200,000 loan amount at the FinAid loan calculation website.

It is estimated that you will need an annual salary of at least $213,044.40 to be able to afford to repay this loan. This estimate assumes that 10% of your gross monthly income will be devoted to repaying your student loans. This corresponds to a debt-to-income ratio of 0.9. If you use 15% of your gross monthly income to repay the loan, you will need an annual salary of only $142,029.60, but you may experience some financial difficulty.This corresponds to a debt-to-income ratio of 1.4.

Bad news recap

  • When she graduates, the best case scenario will be a job paying about $65,000, which translates into an estimated monthly take-home of $4,165.
  • Monthly student loan payments will be $1,775, meaning 43% of her take-home pay will go towards her student loan.  This is considered a financially risky profile.
  • Of course, this doesn’t take into account any other debt a new employee typically incurs, such as a car loan or credit cards.  And she should forget about qualifying for a mortgage until she’s in her forties.

I expect Ms. Baker plans to defray some of her loan payment expenses by taking advantage of the Public Service Loan Forgiveness (PSLF) or the Income-Based Repayment (IBR) federal programs.  But given the size of her debt, it’s likely the bulk of her loan obligations would remain intact.

If she were my daughter, I probably would have counseled her to stay at Starbucks for a while longer.

Marriage ‘penalty’ - Another thought comes to mind.  I would be quite concerned if my son were contemplating marriage to someone who owed $200,000 in student loans and whose main marketable achievement was a degree in communications.

Is this young lady another “Occupy” protestor in the making?

$200,000 in student loans - today's communications major may be tomorrow's 'Occupier'

December 29, 2011

Hybrid learning breaks down geographic barriers for Northeastern University

by Grace

Northeastern University is expanding its brand of co-op business education across geographic regions by investing heavily in hybrid education, with its first branch campus in Charlotte, NC.

The goal is to offer master’s degrees in industries like cybersecurity, health informatics and project management, matching programs with each city’s industries and labor needs, through a mix of virtual learning and fly-ins from professors based in Boston (tuition will be the same as at the main campus).

And it’s not doing it on the cheap

Northeastern, which is spending $60 million to support the expansion, is perhaps the most ambitious of a handful of brick-and-mortar institutions looking to broaden their footprint in new markets and with new methods of instruction….

Northeastern has hired 261 tenured and tenure-track professors in the last five years, about twice as many as in the previous five, and plans to add 200 more in the next three years — all of whom will be based at the home campus in Boston.

Examining traditional assumption that face-to-face is always better than online

“This is a time of huge transition in an industry that hasn’t changed much since the Middle Ages,” said Charles P. Bird, a former vice president of Ohio University who helped develop the institution’s online offerings and now works as a consultant. “Higher education is going from traditional face-to-face delivery, and the unexamined assumption that that is good, to thinking about delivering a high-quality online experience, whether fully online or hybrid.”

Drexel University has struggled with a similar enterprise it began in 2009, perhaps miscalculating the importance of local relationships.

“Bill Gates says place is going to matter less and less for universities in the future, but I think that’s wrong,” said Mr. Aoun, Northeastern’s president. “I think a successful university has to be part of a community.”

Savings for students, and the question of quality

Tuition costs for Northeastern’s new hybrid master’s are the same as those for its Boston campus program, but the savings for students will be in time, convenience, and living expenses.  I remember years ago when my husband was planning his return to school to pursue an MBA.  Since online was not an option, we had to price out the potential costs in terms of my lost income and moving expenses.  Today, that equation is quickly changing.

An important question that remains unanswered is about how the quality of online education compares with face-to-face.  Northeastern, ranked 56 on BusinessWeek’s list of business schools , would seem to have a good chance of serving up a high quality experience with its hybrid approach.

September 29, 2011

Is data analytics the new ‘plastics’?

by Grace


In “The Graduate”, recent college graduate Ben receives advice from an old family friend.

Mr. McGuire: I just want to say one word to you -just one word.
: : : Ben: Yes sir.
: : : Mr. McGuire: Are you listening?
: : : Ben: Yes I am.
: : : Mr. McGuire: ‘Plastics.’
: : : Ben: Exactly how do you mean?
: : : Mr. McGuire: There’s a great future in plastics. Think about it. Will you think about it?
: : : Ben: Yes I will.
: : : Mr. McGuire: Shh! Enough said. That’s a deal.

Is data analytics the new plastics?  If so, even traditionally math-phobic marketing students may be forced to confront mathematics and statistics courses.

Faced with an increasing stream of data from the Web and other electronic sources, many companies are seeking managers who can make sense of the numbers through the growing practice of data analytics, also known as business intelligence. Finding qualified candidates has proven difficult, but business schools hope to fill the talent gap.

This fall several schools, including Fordham University’s Graduate School of Business and Indiana University’s Kelley School of Business, are unveiling analytics electives, certificates and degree programs; other courses and programs were launched in the previous school year….

Data analytics was once considered the purview of math, science and information-technology specialists. Now barraged with data from the Web and other sources, companies want employees who can both sift through the information and help solve business problems or strategize. For example, luxury fashion company Elie Tahari Ltd. uses analytics to examine historical buying patterns and predict future clothing purchases. Northeastern pizza chain Papa Gino’s Inc. uses analytics to examine the use of its loyalty program and has succeeded in boosting the average customer’s online order size….

Fordham this fall will introduce a required analytics course—Marketing Analytics —for M.B.A. students on its marketing track. “Historically, students go into marketing because, they ‘don’t do numbers,’”said Dawn Lerman, director of the business school’s Center for Positive Marketing. But these days, with so much data available surrounding consumer behavior, “you can’t hide from math and statistics and be a good marketer.”


Three more words:  21st Century Skills

ADDED:

As the use of analytics grows quickly, companies will need employees who understand the data. A May study from McKinsey & Co. found that by 2018, the U.S. will face a shortage of 1.5 million managers who can use data to shape business decisions.

August 11, 2011

Nose under the tent – top business school goes online

by Grace

The University of North Carolina’s Kenan-Flagler Business School is taking its brand online.

While online programs are still mostly seen as the purview of for-profit schools, like the University of Phoenix and Capella University, UNC is hoping to change that image.

The business school this Monday launched an online M.B.A. program with 19 students, dubbed MBA@UNC, that will offer the same core curriculum as its regular full-time M.B.A. program. It is the first online program of its kind from a top-20 U.S. business school….

UNC officials say that admissions standards for the new program are just as high as for an on-campus M.B.A. UNC students in the class of 2012 had a median Graduate Management Admission Test score of 700 and a grade point average of 3.3.

The cost is $89,00, just under the $98,000 for the on-campus program.  Meanwhile, other top schools seem to be in a wait and see mode.

So far, other top schools, including Harvard and the University of Chicago, say they don’t have formal plans to create their own programs.

While the Anderson School of Management at the University of California, Los Angeles, has offered “a handful” of hybrid or fully online versions of short electives in recent months, they’re still “experimental at this stage,” said Carla Hayn, senior associate dean for the fully employed M.B.A. and executive M.B.A. programs. “We’re wading very gently into these waters.”

Ms. Hayn said “there are other aspects to education”—such as networking and learning to read social cues, “that are kind of hard to get online.”

UNC Makes Risky Online Bet

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