Archive for ‘Uncategorized’

October 7, 2014

Dangerous jobs pay a risk premium

by Grace


FavData shared the graph on the left that shows the percentage of males holding various types of jobs, indicated by bars shaded yellow.  Click the graph to enlarge for details.

At the top are pre-k teachers (2.3% male) and at the bottom are boilermakers (99.8% male).  Second from the bottom with 99.6% male are “drillers of earth”, an intriguing term for a job with which I’m familiar, at least those drillers who work in the oil industry.  When I worked at drilling sites as a petroleum geologist, I never ran across any female wellsite workers in any category.

How does this tie in with the gender wage gap?

This graph seems consistent with BLS data showing that in 2012 “92% of all workplace fatalities were men”.  The bottom section of the graph shows men dominate jobs that involve risky physical activities handling heavy equipment.  I recall it was not uncommon and almost a mark of honor for an oil well worker to be missing a finger.  Economist Mark Perry sees a link to the gender wage gap.

… Isn’t it realistic to assume that men naturally show greater tolerance than women for risky, physically demanding, dangerous work in extreme outdoor conditions, and women put a higher priority on office work environments that are low-risk, indoors, safe and pleasant? Higher (lower) risk = higher (lower) wages, ceteris paribus, and women on average may be perfectly willing to accept lower wages for lower risk jobs, which would contribute to the unadjusted gender wage gap.


Mark J. Perry, “Washing windows hanging from a rope 12 stories above the ground, I hope he’s getting paid a risk premium”, Carpe Diem, September 9, 2014.

October 1, 2014

Student loan default rate drops, but reporting is fuzzy

by Grace

The default rate for federal student loans dropped from 14.7 percent to 13.7 percent last year.  That’s a good sign, but it is informative to look a little more closely at the reporting.

How the default rate is determined

Default rates are based on the number of students who’ve defaulted on at least one student loan three years after leaving college. It takes at least 9 months of non payment for a default to take place and show up on one’s student loan record and credit report. The default rate has nothing to do with whether borrowers will default later while on repayment plans that can last up to 30 years.

The government “adjusted” the default numbers to protect some colleges from losing federal aid.

… the talk among advocates, reporters, and policy wonks on Wednesday was less about the drop than about the Education Department’s last-minute tweak of its own numbers. That “adjustment,” which spared some colleges whose high rates would have cost them their ability to award federal aid, has reanimated the debate over default rates, long derided as a poor measure of institutional quality.

In news releases and on social media, many said the eleventh-hour reprieve undermined what little credibility the rates had, weakening them as an accountability measure.

For colleges at risk of losing federal aid, the government bureaucrats excluded from their report “any borrower who had loans with multiple servicers and defaulted on only one of them”.  Apparently the rationale for this adjustment is that it is believed borrowers with multiple accounts usually default is because it’s so hard to keep track of all their loans.  Thus, colleges should not be penalized.  Uh, okay.  In any case, considering that the default rate is high even with excluding so-called confused borrowers means other reasons are at play.

 Why students are still defaulting

It’s hard to know the exact reason why students default, but there are three reasons that are pointed to the most: not finishing college, lack of employment post graduation, and lack of financial education. The first two reasons make sense. If you don’t have a job or you don’t feel you’ve finished your education, you may be fearful of student loan repayments. However, lack of financial education is really the main reason for most defaults. Why? So many repayment plan options exist, including Pay as You Earn, where borrowers may not have to pay anything when their income is low enough. Monthly payment amounts under the Pay as You Earn plan are adjusted annually based on income and there is a 20-year cap on loan payoffs. Temporary payment breaks also exist that also have kept borrowers out of default for those first three years in repayment.

The government has made attempts to promote the various reduced loan repayment options because supporters believe ‘millions of borrowers who qualify but do not participate are “effectively leaving a rather sizable amount of money on the table”’.  One of the latest promotions has been in partnership with Turbo Tax.

Turbo Tax users will see information about loan repayment options and a link to the Department of Education website in a section of the program called “My Money Tools.”

They are provided with a link to a calculator that uses tax information, including their adjusted gross income, marital status and household size to determine eligibility for income-based and other income-dependent repayment programs.


Reyna Gobel, “Federal Student Loan Default Rate Drops”, Forbes, 9/28/2014.

Kelly Field, As Default Rates Drop, So Does Confidence in How the Education Dept. Counts Them”, Chronicle of Higher Education, September 25, 2014.

May 12, 2014

How important are cognitive skills in escaping poverty?

by Grace

A Brookings Institute study tells us that cognitive skills are very important in escaping poverty.

87 percent of poor smart kids escape poverty 

The green bar on the far left of this graph shows that 87% of children with the highest level of cognitive skills who grow up in the lowest income quintile move out of that quintile by adulthood.  The orange bar for that same lowest quintile shows that only 46% of low-income children with the lowest cognitive skills escape poverty.


Furthermore, the chances for these top-scoring poor children to become rich are the same as those of comparable middle-class children.

… High-skill adolescents in the bottom quintile have a 24% chance of making it to the top quintile similar to the rate seen among high-skill students in the middle-income quintiles.

Cognitive skills were measured using the Armed Forces Qualifying Test (AFQT).  The study also found that conscientiousness, measured by the coding speed section of the Armed Services Vocational Aptitude Battery (ASVAB), is similarly associated with the ability of poor children to escape poverty.

A college degree improves the chances “of upward mobility for smart, poorer kids”.

… those with a degree had a 42% higher chance of making it from a lower-income household as a child into the higher-income bracket as an adult….

This data suggests ideas for policy changes, including one that would improve the opportunities for high-achieving children from low-income families to attend college.

An important caveat from the study:

… Needless to say, adolescent AFQT and coding speed scores are far from a pure test of merit, or market ability. They simply measure certain skills that have developed up to the time of test taking. A whole host of factors—family background, formal education, and social environment—will have influenced this development. It is important to stress that our measures do not—cannot—capture innate levels of skill or ability.

Related:  How do public schools treat below-average students? (Cost of College)


Dylan Matthews, “87 percent of poor smart kids escape poverty”, Washington Post, November 20, 2013.

Richard V. Reeves and Kimberly Howard, “The Glass Floor:  Education, Mobility, and Opportunity Hoarding”, Center on Children and Families at Brookings, November 2013.

February 18, 2014

Cost of College seminar in New York

by Grace

Please join me at this upcoming event.

If you live in the New York City area and are interested in learning more about the rising cost of college, its impact on families, and strategies for handling college costs, I invite you to join me at a seminar next Tuesday, February 25.

The Cost of College and Its Impact on Families
February 25 at 7:30pm
Curious on Hudson Learning Center
145 Palisade Street, Suite 412B
Dobbs Ferry, NY 10522

To register, go to the Curious on Hudson site.

January 17, 2014

Facebook: teens are leaving and old folks are rushing in

by Grace

We’ve been hearing that young people are leaving Facebook and migrating to Instagram and Snapchat.  The report on 2014 Facebook Demographics & Statistics shows some numbers behind this trend.

Top Insights:

1) Teens (13-17) on Facebook have declined -25.3% over the last 3 years.

2) Over the same period of time, 55+ (perhaps those teens’ parents and grandparents?) have exploded with +80.4% growth in the last 3 years.

3) Of the major metropolitan areas, San Francisco saw the highest growth with +148.6%, a stark contrast with Houston which saw +23.8% growth.

Young adults age 18-24 have also been leaving Facebook, although at lower rates than younger teens.


Based on my limited anecdotal evidence, Instagram is currently one of the hottest online tools for teens.


January 6, 2014

Advice to high school seniors: fill out the FAFSA right now

by Grace

Advice for high school seniors from NextStepU includes this important tip.

Fill out the FAFSA as soon as you can
For your freshman year, you need to send in your FAFSA very early (check specific deadlines). It is a pain, but make sure that you sit down with your parents and apply for federal financial aid as close to Jan. 1 as possible. *Note: Make sure you or your parent goes in and makes the appropriate changes to the FAFSA once the family receives its tax returns.*


Also check for any additional forms required by your state to determine eligibility for their financial aid program.

Click on Five New Year’s financial aid tips for seniors to see the complete list of recommendations.

Related:  File your FAFSA ASAP – financial aid is often first-come first-served (Cost of College)

December 3, 2013

Would the proposed Affordable College Textbook Act cut costs for students?

by Grace

With the costs of college textbooks rising about three times the rate of inflation, students should be happy to see any change that would save them money in this expenditure.

The 812-percent growth in textbook prices is far greater than the percent growth for college tuition and fees over about the same period. Prices have gone up 82 percent in the last decade alone. The average college student is now paying about $1,200 a year on textbooks and supplies.


The Affordable College Textbook Act

Democratic Senators Al Franken of Minnesota and Dick Durbin of Illinois have introduced the Affordable College Textbook Act, a bill that “would set up a competitive grant program to support pilot programs at colleges and universities ‘that expand the use of open textbooks in order to achieve savings for students'”.

Open-source textbooks are already in limited use, bolstered by programs like Rice University’s OpenStax that offer a selection of free texts for a limited number of introductory courses.  The Gates Foundation is one of its financial supporters.

Franken and Durbin are hoping to speed up the open-source trend. Their bill would set up a competitive grant program to support pilot programs at colleges and universities “that expand the use of open textbooks in order to achieve savings for students.”

Shouldn’t technology already be bringing down the cost of textbooks?

“The dirty secret about textbooks is that they don’t have to be so expensive given the rise of technology,” said Matthew Segal, co-founder of, which endorses the bill….

The reasons for the high cost of college textbooks have been the subject of much debate.

Academic Publishers will tell you that creating modern textbooks is an expensive, labor-intensive process that demands charging high prices. But as Kevin Carey noted in a recent Slate piece, the industry also shares some of the dysfunctions that help drive up the cost of healthcare spending. Just as doctors prescribe prescription drugs they’ll never have to pay for, college professors often assign titles with little consideration of cost. Students, like patients worried about their health, don’t have much choice to pay up, lest they risk their grades. Meanwhile, Carey illustrates how publishers have done just about everything within their power to prop up their profits, from bundling textbooks with software that forces students to buy new editions instead of cheaper used copies, to suing a low-cost textbook start-ups over flimsy copyright claims.

It seems that college professors would be central players in any move to cut textbook costs.  But it’s unclear that anyone has a strong incentive to make books more affordable.

Just as the schools have little incentive to keep their costs down, knowing the bills will be paid thanks to federal guarantees, the publishing industry has even less of an incentive to keep costs under control. Why? Because everyone — even the professors who often profit from royalties from textbook sales — except the student has a monetary incentive to keep things just the way they are.

Related:  Going to all-digital textbooks saves money for private high school students (Cost of College)

October 3, 2013

‘Get your kicks on Route 66′

by Grace

The costofcollege family on a Route 66 stop

On a road trip, the journey is the destination.

Since I’ve long been a fan of road trips, I was thrilled when my family agreed to try a Route 66 vacation this summer.  Although I was a little concerned how we would manage, as it turned out a good time was had by all.

Logistics & planning:

We mapped out a thirteen-day adventure, starting in Santa Monica and ending in Chicago.  Since a westward route seems to be the more common choice, most of the guide books we found are primarily oriented that way.  However, a set of reverse guidelines are usually provided as well.

After researching a bit, we picked out some priority stops.  There is lots to see and do on Route 66, so we had to narrow our choices to those that matched our interests.  This helped flesh out our itinerary, although significant parts were not planned in much detail as we made on-the-road decisions about stops and motels.

We used Google maps to determine driving times.  Sometimes we took the faster highway options, not always sticking to the old Route 66 roads.  Most of our driving days maxed out at four to seven hours of driving, but we had a couple of nine-hour days.  We mostly avoided night driving.  Our trip included two major detours:  Las Vegas and the Grand Canyon.  In total, we drove about 2500 miles over 13 days.

Places we stopped:

Hollywood Walk of Fame; Route 66 Mother Road MuseumSouthern California Logistics Airport; Las Vegas; Hoover Dam; Grand Canyon; Standin’ on a Corner Park; Santa Fe; Petrified Forest; Devil’s Rope Barbed Wire Museum;  Cadillac Ranch‘ The Big TexanOklahoma City National Memorial & Museum;  Tulsa Air and Space Museum & PlanetariumMeramec CavernsAbraham Lincoln Presidential Library and Museum

Many more stops are not listed, and we also made time to visit relatives and friends.  These visits ranged from a day and a half tooling around Los Angeles with my brother to a 30-minute meet-up with a friend at a Panera in Normal, IL.


As a veteran of the old days using AAA Triptiks, I regained immense appreciation for Google Maps and for the Internet’s ability to deliver all sorts of information to our fingertips.  For the inquisitive mind, it was heavenly to cruise down the highway instantly able to retrieve facts about a wind farm on the horizon, those acres of crops in between small towns, geology exposed by road-cuts, or countless other scenarios along the way.  On the other hand, sometimes it was equally satisfying just to sit mesmerized by the passing scenery.

Observations and insights:

Too much togetherness?
Sitting with their family in a car for hours on end is an inconceivable prospect for many people, but overall we enjoyed each others’ company in spite of a few squabbles along the way.  In our case, the driver/navigator relationship seemed most vulnerable to tense moments.

Ten and ten
About ten days is the minimum time needed to do Route 66, although with our detours and family visits two weeks seemed about right.  For this road trip, I would not bring along a child younger than about ten years old, but obviously this can vary.

Is a road trip very different from other types of vacations?
My husband compared our trip to a cruise — moving along and sampling a little along each stop.  That’s not a bad comparison, and in some ways it can leave a traveler feeling dissatisfied.  For example, a few hours in Santa Fe left me wishing we could spend a few days there.  On the other hand, our Route 66 trip gave us many discrete experiences compressed into a few days, providing unusual insight into the diversity across our country.

For me, Route 66 created many random memories that combined to paint a big, colorful image of our trip.  A few days after we encountered a surfer dude serving fish tacos on Venice Beach, it was priceless to see my daughter’s wide-eyed expression when we found ourselves sitting next to a couple of “cowboys” in a Kingman, Arizona diner.  When we arrived in Springfield, Missouri, I couldn’t help but notice a difference between the boisterous friendliness of Texans compared to the more restrained warmth of Midwesterners.  And when my son started to entertain us by mimicking the subtle but distinctive Southwestern/Native American accent he heard in New Mexico, I realized it sounded so familiar because it was what I had heard growing up in Texas.

Useful resources:

For a different perspective on our trip, you can read what my son wrote on his blog.

August 22, 2013

Increasing college merit aid decreases enrollment of minority and low-income students

by Grace

A recently released report, Undermining Pell from the New America Foundation, charges that colleges are turning their backs on low-income students as they compete for top students with increasingly generous merit-based aid.

To increase their standing on college rankings, more private colleges are giving “merit aid” to top students, who are often affluent, while charging unaffordable prices to the needy, according to the report. The percentage of students receiving merit aid jumped to 44 percent in 2007-2008 from 24 percent in 1995-1996, the report found. To a lesser extent, public universities are using some of the same practices, Burd said.


Increasing merit aid correlates with decreasing minority enrollment.

The report cites other research, including “Keeping up With the Joneses: Institutional Changes Following the Adoption of a Merit Aid Policy” by Amanda L. Griffith.

“It is worrisome, given the already low levels of representation of low-income and minority students at four-year colleges, to find that the introduction of a merit aid policy is associated with a decrease in the percentage of low-income and black students, particularly at the more selective institutions in the sample.”

More federal involvement is recommended.

The New America Foundation proposes a federal “carrot-and-stick” solution.  The carrot would be a Pell bonus program aimed at schools serving high percentages of low-income students, increasing benefits to the neediest students with additional funds and programs.  And the stick would be  a requirement that wealthier schools match a portion of the Pell funds they receive and use these resources to support low-income students.

An opposing view comes from Michael Petrilli, who argues that Pell Grants should not be used to pay for remedial college courses.

 … A huge proportion of this $40 billion annual federal investment is flowing to people who simply aren’t prepared to do college-level work. And this is perverting higher education’s mission, suppressing completion rates and warping the country’s K-12 system.


July 8, 2013

Job success is the most important factor in picking a college

by Grace

College presidents seem to agree with the general population that jobs are the top factor in determining the value of a college, but do not seem to share their concern about affordability.

Poll: Job Success Most Valued Factor in Picking Colleges.

 A new Gallup Poll has found that the factor adult Americans are most likely to say is most important in selecting a college is the percentage of graduates who are able to find a good job. That factor was picked by 41 percent of those polled, followed by the price of the college (37 percent) and graduation rates (16 percent). The wealthier that respondents were, the more likely they were to say that the job success of graduates was the most important factor.

When asked a similar question, college presidents seemed to rank price lower on the scale of importance.




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