A degree used to guarantee secure employment – not so any more, but the alternatives are even worse.
There was a time when the United States had so many well-paying jobs that having a college degree wasn’t necessary, but if you did have one, you got an even better job. Adam Davidson argues in this past weekend’s New York Times that much has changed since this “golden age”, which lasted roughly from 1945 to 1973. The two main reasons for this change both have to do with competition.
More big fish in the pond: In the early 1970s, only 10% of Americans had a college degree. In 40 years, that number has tripled. On the one hand, this means that there are more skilled people and, thereby, better conditions for overall economic growth. But it also means that the level of internal competition is greater than it has ever been and that each graduate must do more to stand out. There’s a real chance that we have too many liberal arts majors (it’s not just them, but that’s the stereotype) who lack real world job skills. Now that it’s expected that you get a degree, too many kids are coming out of high school and getting a degree for the sake of getting one, i.e. not actually learning anything.
The pond is connecting to the sea: Technology has made it much easier to ship jobs overseas. It started with manufacturing and now includes virtually everything (it’s not just call centers either).
So what’s the lesson? Don’t bother getting a degree? Not quite. It’s easy to encounter high levels of unemployment in the Great Recession and think that perhaps college is not worth the investment. While it’s true that a college degree no longer guarantees you a job and a pension, not getting a a degree is increasingly becoming the best way to guarantee underemployment and low earnings.
According to the US Census, a college graduate earns, on average, more than $23,000 more per year than a high school graduate. The unemployment rate among college grads is the highest it has been since 1970, but at just over 5%, it is still only half that of high school graduates. It’s bad for grads, but worse for non-grads. College seems to be a necessary, but not sufficient aspect of full employment.
So stay in school…unless you’re brilliant, in which case, don’t waste your time with class – get good at computers, drug trafficking or money laundering. Check out the list of college dropout billionaires.
It looks like college is still the best way to land a good job. Next time, we look at whether or not it’s worth the (skyrocketing) price of tuition.