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Subscribe to RSSOver half of recent college graduates are jobless or underemployed, meaning their jobs don't fully use their skills or knowledge. This is prompting many to ask, is higher education really worth the cost? TODAY financial editor shares one recent grad's story and offers her own perspective.
The skyrocketing cost of a college education and frustratingly low job prospects have more young Americans questioning the value of a higher education.
Is saddling yourself with so much early in your career worth it?
The simple answer is yes.
A worker with a bachelor's degree will earn $2.3 million on average over a lifetime, according to the Bureau of Labor Statistics. Someone with a high school degree can expect to earn $1.3 million over a lifetime. That's a huge discrepancy. And it isn't shrinking. What I would say is that we have to be smarter about how we go about getting those college degrees.
Here are three tips to help you get the most bang for your education buck:
1. Shop for the best value in education
A college degree is necessary, but spending $50,000 in private school may not be necessary. Shop for the best educational value that you can find. That means maximizing your quest for scholarships and grants, taking the time to fill out the FAFSA and other financial aid forms and looking long and hard at the sticker price. Look at less expensive alternatives like public and community colleges. Community colleges can be a fantastic deal, particularly if you get into a program where there are agreements in place with four-year schools to allow you to transfer in year three as long as you maintain a B average. You get the four-year degree at a much more affordable price.
2. Look for the most employable majors
Go into college thinking about your job prospects when you come out. Strongly consider choosing an employable major. Here are some areas of learning that may do well in the coming years:
- Medical technician
- Nursing
- Education
- Math & computer science
- Engineering
That being said, it is important to study what you're passionate about. But you should keep in mind the rule of thumb that you should try not to borrow more than you expect to earn in your first year out of college. So think about what you're likely to do with that history degree and how much you're likely to make. A website like salary.com can help you do a little research. And if staying within those boundaries means choosing a less expensive school, that's at least something you will want to think about before you matriculate.
3. Make yourself the most marketable candidate
Employers want to see real work experience on the resume, of the sort that makes you valuable to them. It's about showing that you're serious about this field as a career -- and about making the contacts that can help you get that first job.
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A trade such as electrician can make you a good living. A, "higher" education is not a requirement to live a good life. A, "higher" education has a lot to do with ego and arrogance.
I wouldn't say it is arrogance or ego, yes some people it probably is based on the school(s) they go to. But in most cases like mine it was following a dream of what I wanted to do, I am a software engineer and love what I am doing. With outsourcing in the field the salaries are still good but not over the top, it is doing what I love. So my suggestion is to go after what you love, don't go after a degree just because it can allow you to make more money. Many people start out going for a lofty degree and never make it, because their heart isn't it and they just end up in debt.
Anybody can make money but the person who makes money doing what he loves is very fortunate.
Don't expect a lot from a degree that is very easy to get and everybody else is there for the same reason.
Networking with your peers and others is more important than many degrees. Many people with a BS degree in basket weaving have very good jobs just because of someone they know not because of their intelligence.
Many college graduates today do traditional blue collar jobs not because a degree is required but because of what I call education discrimination. Jobs are given to them just because of the assumption that they deserve it.
Many jobs filled by college graduates would be better off filled by someone with only a high school degree. Example have you ever seen someone working in a State Park painting a bench or picnic table more than likely they have a college degree. The person with the college degree in many cases does not possess the manual dexterity to do the job in a professional and timely manner. This cost the tax payers money and should be stopped.
#4 Don't take on government sponsored debt.
Just be born rich is a good solution and it worked for millions if you don't want to take on government sponsored debt. However if you aren't born rich government sponsored debt is a lot better than corporate sponsored debt, and cheaper too.
Government sponsered student loans cannot be removed even during bankruptcy. The government should not be encouraging people to go into debt.
Government loans are the reason tuitions are rising.
What is sad is that neither Romney nor Obama would admit that the government is making education less affordable by way of government sponsored debt.
In 20 years a computer is 1000x more powerful, 1/2 the cost. Yet the people getting paid to educate our kids can't find a way to stop college from doubling in price while decreasing the effectiveness.
But why would they want to kill the golden goose?
Higher education - the current economic bubble.
I completely agree with this article. I guess I do have a "big ego" but it is what it is. I think everyone should have pride in what they do and what they have accomplished so I don't feel bad about wanting a higher education for myself, Ross. I mainly went to college though because I value a good education. Knowledge really is power. And like KH said, I was also following my dream to get a degree. I never thought I would get to go to school because my parents didn't have a lot of money. When I entered, I didn't know the difference between an associates and bachelor's. Now I am finishing my MBA.
This article hit the nail on the head for TWO important factors to consider when obtaining your degree. Forego the overly pricey college. For a lot of us, a degree is a degree. I am in the IT field and a lot of employers seem to be so impressed with just the fact that I have a degree, that I am usually looked at before my peers who did not get a degree.
My dad helped me to select a field that would be lucrative in the long run: Information Technology. I didn't just go for a degree because I was passionate, I really wasn't passionate about IT as much as I was about getting a degree but I knew that an IT degree would be lucrative and I would see the money back so that I could pay back my loans.
At the end of the day, individuals have to do what works for them but use this article as a guideline and don't say you didn't know when it's right here in black and white.
My daughter is an Engineering major. She just signed internship papers for next summer. $5300 a month as a summer intern.
What kind of engineering?
I bet petroleum or RF (ie cellphones) both fields will get students with decent grade multiple offers even before graduation.
If you are able, then getting a higher education at a prestigious school can make you contacts you can use down the road. The payoff can't be precisely calculated in dollar figures. If you are not, then getting a higher education at an affordable, but strong, school can ALSO get you the contacts you might need.
But, regardless of the money, learning the theories and practicalities of liberal arts and the sciences is simply just a good idea. You stretch your brain beyond your own beliefs; you learn to hold more than one argument in your head; you become a true democratic citizen. And that is the real value of education...not just money. Ideally, you want the scope of liberal arts and its focus on critical and creative thinking, as well as a the money-making potential in the applied sciences or arts.
This is why grad school is important. Undergrad preps your brain for all sorts of fields. Grad school is about professionalization. Or, at least, that's what it should be. The key is to select well and when you are ready, not simply at 18 because that's what kids do.
The "skyrocketing costs" of higher education, at least in public colleges and universities, are largely due to student/family demands for the nicest facilities and dorms at the same time that state governments are passing unfunded mandates AND reducing public/government funding for "public" universities. Some "public" colleges and universities now receive less funding from their states than from individual students. In order to provide the education and the facilities and services expected (as well as to comply with a million regulations), the costs of PROVIDING higher education have skyrocketed. That cost is now passed on to the student.
i don't agree matt I've got a high school education made an exelent living welding for the last 40 years. Built my own house raised two kids and for the last 10 years haven't made under $100,000 a year. Havin $50,000 in dept right out of school for a B.S. degree is just B.S. Go to a community college for $1000 come out weldin and make 30 bucks an hour all day long plus overtime.
A more noble profession than pushing paper around while taking a little off every transaction.
I took Electrical Engineering in the early 90s and came out with only $11k of debt with little help from my parents, who couldn't afford much.
Now I do very well and have had 0 debt for 10 years.
that's interesting... i have a 4 year degree, did welding all through college for income at a friends shop.. now after 14 years I'm going back to community college at night and on the weekends to get my certification in MIG and refresher courses in TIG and Shield Metal Arc, Stick for the old guys.. i forgot how much more i like it than setting around at a desk all day, and at least i can have a skill that makes money, and i can go almost any wear with it... now i just have to see if i can get my foot in the door. College was worth it but not every college graduate is really "programmed" to be an office drone.
I keep seeing articles like this but I have to say that in my life I've never met a single person who has gone to school, gotten a degree and then gotten a job based on that degree.
Not any of my friends and not a single family member that I know of. I really feel that courage, a good work ethic and strong social skills will take you farther and leave you in less debt.
I ended up getting the job first, and then having my employers pay me to get the degree. GM, UTC, the Federal Government, and a Law Firm.
It was a much better way to learn - and cheaper too. It did take 14 years, though...
Zen, you must not know many people then. What are these people majoring in ? People who major in the sciences, engineering or computers frequently end up with careers in those areas. If you are mainly talking about liberal arts majors, then I could understand that.
A college degree in the right major will definitely pay off. Keep in mind that this means making good grades, hard work and social contacts. The right trade or vocational training is a good option as well. As for federal student loans and grants, they should limited to 4 years (5 years tops). In addition, the assistance should be contingent upon maintaining at least a 2.5 GPA per semester. If the GPA falls below that the student should have to petition for reconsideration. The student should only be given three attempts to maintain a 2.5 GPA after that their on their own.
Part of the problem with escalating student loan debt is the aggressive marketing tactics of the "degree-mill" type schools. The aggressively sign up "students" who lack the ability or aptitude to complete any course of study. It is a big racket. We had one of the "colleges" in office building. It was just a giant office space filled with phones. I have had several others who came to our company is perspective clients. Several were located in store fronts in strip malls.
I work for a large university and I see students everyday opting to continue on for graduate degrees rather than face the unemployment and student loan debt that awaits them once they walk out the door with the BS or BA degree that can't get them a job.
Yeah and that graduate degree isn't going to help much either. :(
Instead of comparing 4 year college versus high school, how about comparing 4 year college degrees to other levels of post secondary education? i.e. trades or 2 year degrees from community colleges that apply directly to a job. I bet the results would be a bit different. I agree that if you have a specific career/education in mind like engineering or teaching or whatever that requires a 4 year degree, than that is what you need to do. But there are a lot of students at 4 year schools who are just looking at it as a way to get ahead (because that is what is drilled into their heads) with no specific job in mind. There are other education/training options out there that are much less expensive, and allow them to make a good living.
Excellent point! Comparing high school grads to college grads is unfair to all of the trades.
Statistics like the ones bandied about in this story are meaningless. Not all college degrees are the same.
I worked my way through college, and it took 14 years. I found my Engineering and Law degrees to be worthwhile.
A friend of mine borrowed $50,000 to get a bachelor's degree in Philosophy. He works at a Starbucks.
I know many folks who went to "college" and got worthless liberal arts degrees, and the later on learned a TRADE so they could make money.
Was education-for-education's sake worth it? Well, they went to Party-U and drank and smoked pot, but really didn't learn a lot about the "great authors". They never even read the books, just the Cliff Notes.
Making blanket statements like "A person with a college degree earns X, while one without earns Y" is really deceiving. Because the latter category includes a lot of very poor and not very bright people who end up working minimum-wage jobs all their lives. This brings down the average.
There are a LOT of people without college degrees who are very bright and start their own businesses and are quite successful.
And there are a LOT of people with college degrees who end up working slacker jobs for the rest of their lives.
Statistics take personal initiative and personal abilities out of the equation. They should be viewed with skepticism.
exactly right. If this person working at Starbucks had taken some classes in business admin and economics, he might end up managing a Starbucks or even work his way up higher in the company.
choose wisely.
It is much easier to throw a blanket over a group of people, than it is to embrace each one in the warmth of individual understanding.
I'm having a different problem. Been doing a job for 12 years. Was asked to fill in as an interim mgr until they hire the next manager. I was asked if I was interested in applying. Of course, the answer was yes. I apply and was told I don't qualify because of my education or lack of. How does that work? I'm good enough to be the interim, but not good enough to apply?
Find out what you need and take some night classes so the next time the situation comes up you will be ready.
It doesn't appeal to your common sense, nor to mine, however, organizations have specific job descriptions for each position in the company. While your organization is waiving those specific requirements in the interim, they cannot waive them long term. They must maintain equitable job descriptions and requirements across the organization, so that they show fair and equitable hiring practices. I like a--rand's idea.
I would suggest to any young college student that does not know what to major in to take some classes in business and economics. No matter what you decide from there, those studies will always come in handy.
A competent Tradesman who dropped out of school will probably make more than someone with a Master's degree in something stupid, like the impact of Star Wars on mankind. Get a dumb degree, make dumb money; make good out of yourself and make a good living.
In many cases a diploma is just a receipt that shows you were able to avoid working for a living for several years after graduating high school.
If you are a teen thinking about higher education, pay close attention to what this article says. Don't overpay for your education and pick the right major. You can find average salaries by position on-line. Here is an example. Social work, which requires 4-8 years of school, does not pay. If you want to do social work, volunteer for a hot line or something. And don't turn your nose up at trade schools. Learning the right trade can really pay off. Over 25 years ago, I earned a degree in computer programming at a technical school. Tuition was less than half that of a 4 year school. And I only had to pay for two years. Since graduation, I've never had a problem finding or keeping a job. I have always made more than the national median income. Ten years ago, my employer paid my way thru night school and I now have a four year degree in computer science. The pay hasn't changed. It just looks good on my resume.
I agree with you on doing research! Awesome point. At the same time we must point out that there is no way to know what the future will bring. Ten and 15 years ago K-12 teachers were big on the list of what the job market needed. Now there is a glut of K-12 teachers. I also remember when computer programming was the degree to pursue, now computer programmers are in the unemployment lines. I'd say choose your major carefully, and realize you won't be in the same career 15 years after you graduate.
alan_static
Government sponsered student loans cannot be removed even during bankruptcy. The government should not be encouraging people to go into debt.
Government loans are the reason tuitions are rising.
This is true----When you take out a government loan you are stuck for life, even bankruptcy will not get you out of it.
The easier government loans are to get, the higher the cost of education will be. When there is no competition prices always rise. This is Econ 101.
For some it is "worth it" for a whole lot of people it simply isn't. 70 percent of Iowa high-school grads go to college. Is college worth it for the entire 70%? Of course not. Was it worth it for me? I am middle aged with $35,000 worth of debt in a sour economy. It most certainly was NOT worth it for me. Was is worth it for my daughter with over $50,000 worth of debt? No it was not. So let's make it simple. I'd guess about 1/2 the degrees out there are worthless.
Oh to be in that 50% where it is "worth it!"
There is another solution. www.knowledgestrong.com/join.html
We formally invite Liz to become a founding member.
www.knowledgestrong.com/about.html
Somebody please address this: I earned a degree from one of the Big Ten universities back in 1980. No company would offer me one of those "great paying" salaries. I went further to earn another degree in the 1990's, and still could not land one of those high salaried jobs. Personally for me, college degrees have NOT opened any doors for me. Obviously, it seems to me that it is not what you know, its who you bl..........
This problem arose because of outsourcing and corporate greed, and is made worse daily by those same factors. Until good jobs are available without luck and the overpriced degree system people will do whatever they have to in order to survive.
I have a Masters Degree in Human Relations and Business. I am a college instructor at a university and at a community college. I am lucky to make 25k a year. In addition to the face-to-face interaction with my students, I work 7 days a week maintaining my classrooms in the school's learning management systems--grading, and emailing with students.
The educational organizations need instructors like me, but they just don't want to pay us full time. Adjunct instructors make up a large percentage of the higher education workforce, and garner low wages, no benefits, and no job security.
There is an internal struggle for me when it comes to encouraging my students to continue on that higher educational path, as I am living proof that higher education--even in business-- does not provide you with higher wages or a more secure future. I always just hope it will turn out better for them.
Yes, I am doing something I love, and something I am passionate about, but I have also become accustomed to eating, having four walls with a roof over my head, and the ability to go to the doctor if I ever get deathly ill.
At this time in our nation, the stockpile of humans appears endless to employers. Therefore, when one falls dead on the floor, the employers know they have at least 10 more humans to choose from as a replacement. That is the reality of the workplace; so learn from it, live with it, and don't take your importance in the scheme of things too seriously.
I'd like to see a study where the people without college degrees are matched on
IQ with those who have the degrees. I'll bet the difference would be a LOT less
then, and maybe less than the cost of the degree.