Archive for February 11th, 2013

February 11, 2013

College graduates are no longer ‘special’

by Grace

 the signaling value of a bachelor’s degree declines as a larger proportion of the population achieves it.

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50 years ago, college graduates were considered “special”, according to a report released last month by the Center for College Affordability and Productivity.

… People with such degrees were among a relatively small, even elite, proportion of the population believed to have, for example, very high levels of erudition, intelligence, and discipline. Even graduates of mid- to low- quality institutions were viewed as somewhat special. If in, say, 2025 close to half of adults have such degrees, by mathematical necessity, some graduates are at best just about average, not endowed with relatively high levels of the productive attributes desired by employers.

Today we are trending to a place where only graduates of certain elite colleges and those with advanced degrees will be considered “special”.

… Students are clamoring to attend the 25 or 50 top universities and liberal arts colleges in America. Applications are soaring for those schools, while applications for lesser colleges are stagnating as the number of 18-to-22 year-old Americans (particularly those expected to attend college) plateaus.37 In response, new signaling devices are arising
to broadcast true excellence: attendance at a high quality institution, such as Ivy League schools, Stanford, M.I.T., Duke, Northwestern, Chicago, Amherst, Williams, Swarthmore, etc., or getting even higher degrees, such as a master’s or even a doctorate.

With some negative effects on higher education

…  unintended consequences, such as the denigration of the value of a bachelor’s degree, a lowering of collegiate academic quality, a growing reputational inequality among colleges, etc….

So, is it worth spending $50-$200,000 to send your children to college?

Families feel pressured to send their children to college because average figures continue to show that college graduates earn more than those without a college degree.  But when the data is disaggregated, and the increasing debt burden along with opportunity costs are considered, it becomes clear that parents should be more thoughtful in making decisions about their children’s college plans.

  • Comparing average college and high-school earnings is highly misleading as a guide for vocational success, given high college-dropout rates and the fact that overproduction of college graduates lowers recent graduate earnings relative to those graduating earlier;
  • Not all colleges are equal: Typical graduates of elite private schools make more than graduates of flagship state universities, but those graduates do much better than those attending relatively non-selective institutions;
  • Not all majors are equal: Engineering and economics graduates, for example, typically earn almost double what social work and education graduates receive by mid-career;

Since nearly half of working Americans with college degrees are in jobs for which they’re overqualifiedit is worth reconsidering whether college is the best way to spend what may be $100,000+ and five years of your life.  It could be thatskipping college for a high-paying job might be the right move‘. 

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