Too Many Degrees Are a Waste of Money

[Turk.]

By The Economist April 5th 2014


Hard subjects pay off

Unsurprisingly, engineering is a good bet wherever you study it. An engineering graduate from the University of California, Berkeley can expect to be nearly $1.1m better off after 20 years than someone who never went to college. Even the least lucrative engineering courses generated a 20-year return of almost $500,000.

Arts and humanities courses are much more varied. All doubtless nourish the soul, but not all fatten the wallet. An arts degree from a rigorous school such as Columbia or the University of California, San Diego pays off handsomely. But an arts graduate from Murray State University in Kentucky can expect to make $147,000 less over 20 years than a high school graduate, after paying for his education. Of the 153 arts degrees in the study, 46 generated a return on investment worse than plonking the money in 20-year treasury bills. Of those, 18 offered returns worse than zero.

Colleges that score badly will no doubt grumble that PayScale?s rankings are based on relatively small numbers of graduates from each institution. Some schools are unfairly affected by the local job market?Murray State might look better if Kentucky?s economy were thriving. Universities that set out to serve everyone will struggle to compete with selective institutions. And poor colleges will look worse than rich ones that offer lots of financial aid, since reducing the cost of a degree raises its return.

All these caveats are true. But overall, the PayScale study surely overstates the financial value of a college education. It does not compare graduates? earnings to what they would have earned, had they skipped college. (That number is unknowable.) It compares their earnings to those of people who did not go to college?many of whom did not go because they were not clever enough to get in. Thus, some of the premium that graduates earn simply reflects the fact that they are, on average, more intelligent than non-graduates.

What is not in doubt is that the cost of university per student has risen by almost five times the rate of inflation since 1983, and graduate salaries have been flat for much of the past decade. Student debt has grown so large that it stops many young people from buying houses, starting businesses or having children. Those who borrowed for a bachelor?s degree granted in 2012 owe an average of $29,400. The Project on Student Debt, a non-profit, says that 15% of borrowers default within three years of entering repayment. At for-profit colleges the rate is 22%. Glenn Reynolds, a law professor and author of ?The Higher Education Bubble?, writes of graduates who ?may wind up living in their parents? basements until they are old enough to collect Social Security.?

That is an exaggeration: students enrolling this year who service their debts will see them forgiven after 20 years. But the burden is still heavy for many. It does not help that nearly a third of those who take out such loans eventually drop out of college; they must still repay their debts. A third transfer to different schools. Many four-year degrees drag on longer, and so cost more. Overall, the six-year graduation rate for four-year institutions is only 59%.

The lousy national job market does not help, either. A report by McKinsey, a consultancy, found that 42% of recent graduates are in jobs that require less than a four-year college education. Some 41% of graduates from the nation?s top colleges could not find jobs in their chosen field; and half of all graduates said they would choose a different major or school.

Chegg, a company that provides online help to students, collaborated the study. Dan Rosensweig, its boss, says that only half of graduates feel prepared for a job in their field, and only 39% of managers feel that students are ready for the workforce. Students often cannot write clearly or organise their time sensibly. Four million jobs are unfilled because jobseekers lack the skills employers need.
Source

[Bi4me]

I don't know about waste of money, but it sure is a waste of time. And if time = money then... there you go.

[Praetor]

its not a waste of money because you get more knowledge and knowledge is power.

[COKid]

its not a waste of money because you get more knowledge and knowledge is power.

 

Sure, but if you can obtain the same knowledge at little or no cost, then all the better. You can be powerful and not be in debt up to your ears. College is mostly a racket to separate you from your money. And for what? A piece of paper. I've dealt with many people with college degrees who have less knowledge than high school drop-outs who are motivated, self-taught individuals.

[vcfan]

I don't know about waste of money, but it sure is a waste of time. And if time = money then... there you go.

as someone with an engineering degree, i can tell you that it was neither a waste of time nor a waste of money.

[Praetor]

Sure, but if you can obtain the same knowledge at little or no cost, then all the better. You can be powerful and not be in debt up to your ears. College is mostly a racket to separate you from your money. And for what? A piece of paper. I've dealt with many people with college degrees who have less knowledge than high school drop-outs who are motivated, self-taught individuals.

 

that may be the reality in many countries (including US, where public universities aren't as good/recognized as private ones), but not every place is like that. For example, in my country all the medicine universities that exist are public ones and lectures over there are over the top and the best in the world; engineering, law and nursing are also top courses (nursing for example is such a high profile course that most of the students right now emigrate because the amount of foreigner hospitals requiring Portuguese nurses is crazy - and they pay well), so again knowledge is important; of course there's always folks that have a degree but aren't as professionals, motivated or simply incompetent - that is true in every profession. If they are knowledgeable? yes. If they use that knowledge? probably not, because if they did then they wont be such bad professionals like they are.

 

myself i don't have a degree but i'm a very motivated to self taught, i hold several courses and certificates and i'm studding at night in a university so i can expand my knowledge base because i understand that if one must succeed then it's the amount of knowledge and it's use that makes or breaks a professional.

[Dick Montage]

Why do I only employ degree educated developers?

 

Do I believe they are more skilled?  No

Do I believe their academic experience outweighs commercial? No

Do I believe that having a degree sets you in any way "better"? No

 

It reflects to me that they took something on, saw it through to completion, and it provides me with a justification - a provable, hold it up and look at it written copy that they know what they say they know.

 

Simple

[Soldiers33]

From my personal experience I can agree that Uni is the most biggest waste of time and money and effor. I would have gone much further doing different courses and gaining experience than learning trash which I would never use in real life. Unfortunately I only realized that after my second year and would be a waste to drop out on the last year. Luckily my student loan was only 9k, so it wont take too long to repay.

[blerk]

that may be the reality in many countries (including US, where public universities aren't as good/recognized as private ones), but not every place is like that. For example, in my country all the medicine universities that exist are public ones and lectures over there are over the top and the best in the world; engineering, law and nursing are also top courses (nursing for example is such a high profile course that most of the students right now emigrate because the amount of foreigner hospitals requiring Portuguese nurses is crazy - and they pay well), so again knowledge is important; of course there's always folks that have a degree but aren't as professionals, motivated or simply incompetent - that is true in every profession. If they are knowledgeable? yes. If they use that knowledge? probably not, because if they did then they wont be such bad professionals like they are.

 

myself i don't have a degree but i'm a very motivated to self taught, i hold several courses and certificates and i'm studding at night in a university so i can expand my knowledge base because i understand that if one must succeed then it's the amount of knowledge and it's use that makes or breaks a professional.

 

It depends really. The US is well known for having some very good public universities, and university systems (UC and Maryland come to mind immediately). Some of them might not have the brand name cachet of a private Ivy, but there are definitely public universities that are renowned for being the best in various areas, better than their private counterparts.

[dipsylalapo Supervisor]

They may be seen as a waste of money but to get a job in today's market, a degree is more or less required (at least in the UK). 

 

And I think Nik L proves my point. :p

[Praetor]

It depends really. The US is well known for having some very good public universities, and university systems (UC and Maryland come to mind immediately). Some of them might not have the brand name cachet of a private Ivy, but there are definitely public universities that are renowned for being the best in various areas, better than their private counterparts.

 

oh thanks for the input. :)

[Soldiers33]

They may be seen as a waste of money but to get a job in today's market, a degree is more or less required (at least in the UK). 

 

And I think Nik L proves my point. :p

you are talking rubbish. If anything here in UK degree doesnt mean anything anymore. Its all about experience. You go interview and have all the skills, but they want experiance. The amount of interviews ive taken and matched everything, but in the end came second and the response was always the other guy has experience. These days I tell no one to go to Uni cause its waste of time, which will make you end up with a loan of 44k in total.

[dipsylalapo Supervisor]

you are talking rubbish. If anything here in UK degree doesnt mean anything anymore. Its all about experience. You go interview and have all the skills, but they want experiance. The amount of interviews ive taken and matched everything, but in the end came second and the response was always the other guy has experience. These days I tell no one to go to Uni cause its waste of time, which will make you end up with a loan of 44k in total.

 

It depends on what sort of level of position you're going for, with someone with < 3 years experience they won't even consider you if you don't have a relevant degree. 

 

I should have made that clear. I agree as you get more experience your degree counts for less, but starting off in the job market a degree does check a box for recruiters.

[Dick Montage]

If anything here in UK degree doesnt mean anything anymore.

 

It does when I am hiring, and many think like me.

[Skiver Veteran]

I think it depends on the job and level you are trying to achieve. If you take two people, send one to University/college to do an engineering degree and send one straight to a car garage to gain the hands on experience etc. In the 4 years or whatever it takes for the Uni guy to gain the knowledge the hands on guy imo would be more employable to another garage.

 

However take the two people and send them to apply for a motorsport team (F1, GP2 etc) and I would put my money on the graduate being the right man for the job. Could be very wrong with this but I honestly believe that's where degree's make a difference and some roles just don't need that deeper level of knowledge you may gain from a degree.

[blerk]

Chegg, a company that provides online help to students, collaborated the study. Dan Rosensweig, its boss, says that only half of graduates feel prepared for a job in their field, and only 39% of managers feel that students are ready for the workforce. Students often cannot write clearly or organise their time sensibly. Four million jobs are unfilled because jobseekers lack the skills employers need.

 

 

This is anexceptable. All students shuld B able to wriet claerly and organaize their time correcly. Their stupid if they're not able to write correctly. 

 

But seriously - university is not the place to learn how to read and write - that is primary and secondary school. Sure, at university you should learning how to craft a complex, nuanced dissertation on a topic, or write a technical paper (depending on degree); but you should have learnt waaaaaaay before university how to write clearly. (Unless we are talking handwriting. Now that is hard :D)  

 

And by the time you leave university, you should have figured out how to efficiently make use of any time available - but that is something that you should be figuring out by yourself. The university shouldn't have to teach you that. 

 

If new graduates feel unprepared, and their managers think they are unprepared because they cannot do basic stuff like time management and writing clearly - then it is the fault of the person, not the university. 

[Dick Montage]

If new graduates feel unprepared, and their managers think they are unprepared because they cannot do basic stuff like time management and writing clearly - then it is the fault of the person, not the university. 

 

Spot on.

 

And also yes, it depends upon the role.  Sorry, but yes - you can get a job without a degree.  You may work as a developer for many years in a small firm even.  But you wish to progress to management or associate within a legal environment?  Dream on.

[dipsylalapo Supervisor]

If new graduates feel unprepared, and their managers think they are unprepared because they cannot do basic stuff like time management and writing clearly - then it is the fault of the person, not the university. 

 

This is where I think university courses that give you a year in industry help massively. This is exactly what I did, and I felt I learnt much more from that year in industry then I did at university, but it wasn't degree related, it was more about how to run a meeting, how to present, time management. Let's be honest you don't really get that kind of experience at university. 

 

Universities (at least when I attended) hand hold you through the 3/4 years you're there. Working in a job is a whole different beast. 

[Praetor]

This is anexceptable. All students shuld B able to wriet claerly and organaize their time correcly. Their stupid if they're not able to write correctly. 

 

But seriously - university is not the place to learn how to read and write - that is primary and secondary school. Sure, at university you should learning how to craft a complex, nuanced dissertation on a topic, or write a technical paper (depending on degree); but you should have learnt waaaaaaay before university how to write clearly. (Unless we are talking handwriting. Now that is hard :D)  

 

And by the time you leave university, you should have figured out how to efficiently make use of any time available - but that is something that you should be figuring out by yourself. The university shouldn't have to teach you that. 

 

If new graduates feel unprepared, and their managers think they are unprepared because they cannot do basic stuff like time management and writing clearly - then it is the fault of the person, not the university. 

 

^this.

 

Also time management for some people (like me) it's something difficult to achieve properly; i was never taught on how to use the time correctly and now i must constantly make mental notes and use my schedule to organize my day. It's something one can learn but it's not the university job to teach that.

[Dick Montage]

This is where I think university courses that give you a year in industry help massively. This is exactly what I did, and I felt I learnt much more from that year in industry then I did at university, but it wasn't degree related, it was more about how to run a meeting, how to present, time management. Let's be honest you don't really get that kind of experience at university.

 

Exactly the same here.  I ended up managing the department and a job offer to not go back to uni and stay there (I went back to uni).

 

You learn how to act in a workplace, and that is the key thing.

 

Universities (at least when I attended) hand hold you through the 3/4 years you're there.

 

You had it easy then.  We were in no way coddled.  You are meant to struggle at uni, you are meant to be challenged!?

[dipsylalapo Supervisor]

You had it easy then.  We were in no way coddled.  You are meant to struggle at uni, you are meant to be challenged!?

 

Maybe a slight exaggeration, but it's not anything like working in the "real" world, and it was probably dependent on the university you attended ;) 

[blerk]

This is where I think university courses that give you a year in industry help massively. This is exactly what I did, and I felt I learnt much more from that year in industry then I did at university, but it wasn't degree related, it was more about how to run a meeting, how to present, time management. Let's be honest you don't really get that kind of experience at university. 

 

Universities (at least when I attended) hand hold you through the 3/4 years you're there. Working in a job is a whole different beast. 

 

I agree that real world experience really seems to help people, be it engineering or medicine or whatever. In all med/health-related fields at my university, postgraduate/mature/students from allied fields were practically expected to be top of class because they had real world experience and had already figured out how to make the most out of the theory that they were going to be taught in the course. 

 

^this.

 

Also time management for some people (like me) it's something difficult to achieve properly; i was never taught on how to use the time correctly and now i must constantly make mental notes and use my schedule to organize my day. It's something one can learn but it's not the university job to teach that.

 

Time management is hard :( - my being on neowin at this moment is testament to that. Procrastination FTW!!! :D 

[Knife Party]

i've already got one degree in business management, and now in the last term of finishing my second degree in marketing with honours. My friends are all working, but hey, i've got 2 degrees and the jobs are out there for those who want to make or break it. If you did liberal arts - ouch I feel sorry for you! These guys usually have 0 time management or sense of accountability. I'm not big on spoon feeding, but very big on corrective guidance. 

[+Majesticmerc MVC]

Chegg, a company that provides online help to students, collaborated the study. Dan Rosensweig, its boss, says that only half of graduates feel prepared for a job in their field, and only 39% of managers feel that students are ready for the workforce. Students often cannot write clearly or organise their time sensibly. Four million jobs are unfilled because jobseekers lack the skills employers need.

As others have said, I don't think that it's the job of the university to teach that. Time management, working within a work force, are both things that kids should be taught in school. University is (or at least should be) a much more purely academic environment which allows an intelligent mind to specialize in a specific area of knowledge, any benefits gained in terms of time management and general employee skills are a pleasant side-effect.

What really grates on me is how so many companies expect fresh-faced graduates to be perfect employees, despite many (most?) of them never having had a full-time job. Students, and young people on the whole, are not ready for the workfoce, but in my opinion that's what entry level positions are for. Entry level positions are supposed to be for people new into the working public to wet their beaks and get experience on the "real world", where they can adapt to being an employee, gain working knowledge, and progress to higher things. Similarly, graduate programmes should serve the same purpose. Hell, I took a job as a "graduate software developer" with my current employer for specifically that reason. They don't make enormous assumptions about your knowledge, they give you easier jobs while accustoming you to working life, and over time assimilate you as a full-fledged developer.

The problem here isn't universities specifically (although the outrageous fees that you folks in the USA have to pay doesn't help), the problem is that employers are now looking for "graduates" with "5 years experience in <insert advanced subject here>" that they obviously don't have. If employers can't fill 4 million positions in an economy like this, perhaps standards need to be a little lower.

[dipsylalapo Supervisor]

As others have said, I don't think that it's the job of the university to teach that. Time management, working within a work force, are both things that kids should be taught in school. 

What really grates on me is how so many companies expect fresh-faced graduates to be perfect employees, despite many (most?) of them never having had a full-time job. 

 

the problem is that employers are now looking for "graduates" with "5 years experience in

 

Surely before university is way too early to teach these sort of skills? I go back to my point of learning these skills whilst you're actually doing a degree through a placement, but that's just my opinion. My university and placement year helped me to become the person I am today (yes it sounds cheesy but it's true). I think people change a lot during those years and it should be at that time these kind of skills are best learnt (IMO). Who should be responsible for that, I don't know.

 

Look at in on the flip side, there are many graduates coming out of university that think they can walk into these jobs because they have a degree in XYZ and that's just as bad, being overconfident. I've talked to graduates who have started at started recently at the company that I work and they talk about having been project managers. I ask them about what sort of budget they were working to, what tools did you use to track their project and they don't have a clue. 

 

I completely agree with your last point, it's just ridiculous.