By Rachel Brody |
Just as buying speculative stocks makes sense for some investors but not others, so "investing" in a college education has a payoff for some--but for many others it is a mistake. Students who have a high probability of graduating from a good-quality university are likely to find attending college is financially worthwhile. Who are those students? Generally they are ones who did well academically in high school and had pretty good scores on college entrance tests like the SAT or ACT.
But for many students, the investment in college is not profitable. About 40 percent do not make it through a four-year bachelor's degree program in even six years. Others who major in subjects with low vocational demands often have trouble getting jobs. For many years, we have turned out more college graduates than the growth in the number of jobs in the technical, managerial, and professional areas where college graduates historically want to work. Therefore, we now have nearly 80,000 bartenders and taxi drivers with bachelor's degrees. One estimate is that 1 in 3 college graduates has a job historically performed by those with a high school diploma or the equivalent.
As the cost of college rises and the mismatch between labor market realities and college graduation rates persists, this problem is likely to continue even if we ever get out of the Great Recession. As average student loan debt rises above $25,000 and high-paying job opportunities become scarcer, the case for attending college diminishes for a growing subset of the population.
Not going on to a bachelor's degree from high school does not necessarily mean most non-degree-seeking students should simply go to work. Many would benefit from a community college education or taking an associate degree at a for-profit institution. If successful there, the opportunity still exists to transfer into a four-year degree program. Others would do well to enroll in shorter non-degree training programs to learn to be, for example, a long-distance truck driver, beautician, or medical records clerk. The paths to success as young Americans transition to adulthood are many, and only for some should that definitely involve pursuing a four-year degree after high school.
About Richard Vedder Director of Center for College Affordability and Productivity
Naomi Schaefer Riley Author of 'The Faculty Lounges ... And Other Reasons Why You Won't Get the College Education You Pay For'
Robert B. Schwartz Francis Keppel Professor of Practice in Educational Policy and Administration at Harvard University