Originally printed in Forbes. Reprinted with permission.
Colleges and universities are still the best, most direct path to a good career that pays well.
It’s possible to believe otherwise, of course, because so many seemingly credible people and sources keep implying, if not outright saying, that, career-wise, college may not be a good investment. The New York Times, Wall St. Journal and Washington Post all ran pieces this year asking whether college was worth it. Literally all three used the phrase “worth it” in their headlines. Here too is a video from The Economist from September of this year that begins, “Is University Worth It?”
The video, like some of its print brethren, repeats the same discredited tropes about “huge tuition fees” and goes on to say that students should be working instead of going to college, earning instead of learning. It says, “young people are ill-served by expensive degrees,” and says we need a “radically different approach.”
Foremost, earnings is a terrible way to measure the value of going to college. Doing so commercializes and minimizes everything about it.
Nonetheless, despite what you may have read or seen, the monetary value of a college degree is simply not in question. Overwhelming data shows that people with college degrees earn significantly more than those without. Doug Webber, who’s extensively researched such things recently wrote, “Let me be clear, the financial returns to graduating from a four-year college far outweigh any costs for the average student,” and that, “The typical college graduate will earn roughly $900,000 more than the typical high school graduate over their working life.”
Even the Times opinion piece headlined “College May Not Be Worth It Anymore” conceded that “Young people and their families go into debt because they believe that college will help them in the job market. And on average it does.”
Yes, it does. College is definitely “worth it.” There’s simply zero evidence that getting a college degree is anything but “worth it.”
Nonetheless, the questions persist as to whether colleges help people get good jobs. If they didn’t, you may expect there to be large numbers of college graduates who cannot find work, but the unemployment rate among college graduates is historically low – just 2.2% as of November 2018. For those with a high school diploma and no college, it was 3.5%, which is also great. But there’s no doubt you’re more likely to have a job if you have a college degree.
Then there’s the issue of so-called degree inflation in which jobs and careers that did not previously require a college education now do. There are, by most accounts, millions of these “middle-skill” jobs that have evolved to require a college diploma. Examples include sales supervisors, office managers and assistants, support specialists and clerks.
A 2017 report by Harvard Business School found degree inflation common and continuing and also found that “employers began hiring college graduates in search of higher talent quality” and that “Many employers admit that they now pay a significant premium when they hire workers with college degrees.” So businesses clearly view a college degree as something worth seeking out and worth paying for. Say what you will about businesses, they’re not in the habit of paying more for things that aren’t worth it.
There’s also the fact that, if you actually ask college students whether what they’re learning has workplace utility, they overwhelmingly say yes. The 2018 National Survey of Student Engagement conducted by Indiana University, for example, found that “About 9 in 10 seniors believed what they were learning in college was relevant to their career plans.”
The analogy is flawed and wrong but if college students are the customers of colleges, assuming those customers want their time in college to lead to a good job, the customers say they believe they are getting what they’re paying for.
Given all that and more, a “radically different approach” is probably not a good idea for a system that’s producing more jobs and higher earnings. All things considered, the employment market is sending exceptionally clear signals that college works. It’s less clear why places such as The Economistand the Wall St. Journal are not reading them.