Is the Value of a College Degree Still Worth the Cost?
Today’s higher education environment vis-à-vis the national economic situation has ignited a debate over whether a college degree is worth the cost. Significant budget cuts in many states have meant that colleges are raising tuitions, increasing fees, and offering less in scholarship money to students. Few students had enough money saved to pay for college prior to the economic downturn which has had a catastrophic impact on many schools (see my daily headline postings and links in the “Impact of the Economy on Higher Education” section of my blog for some examples). With less money allotted for scholarships, work study programs, and higher tuitions and fees, more students than ever before are incurring large debts to pay for their college educations. The current unemployment rate stands at 9.1 percent and recent college graduates are reporting extreme difficulties in finding a job. All of these factors have combined to fuel the debate over whether college is as invaluable as once believed or not valuable at all given recent economic realities.
Within only a couple months of taking office, President Obama announced his goal to increase the national college graduation rate which is woefully low (40.4 percent, according to statistics from the College Board) compared to those of other nations including Japan (53.7 percent), Russia (55.5 percent), and Canada (55.8 percent). One of the main initiatives associated with President Obama’s plan to boost college graduation rates included a proposal to provide $12 billion in funding to US community colleges over a ten year period. Per the President’s plan, however, these funds would be for use in improving programs, courses, and facilities; not, in other words, to assist students in paying for their degrees at these schools. Obama also told community colleges that he would like to see them play a more active role in creating jobs while simultaneously graduating five million more students than current rates by the year 2020.
Two years after tasking community colleges with such an ambitious goal, the unemployment rate lingers around nine percent nationwide, down slightly from when President Obama took office but still painfully high for many college graduates. Whenever the economy tanks, college enrollments tend to rise as people return to school in hopes of earning a degree that will help them stand out in a highly competitive job market. With state funding dwindling and colleges and universities forced to make hard economic decisions, many students are finding it difficult to even get into a classroom thanks to faculty layoffs, program cuts, and other actions taken by many schools in an attempt to balance their budgets. Without question, so many cuts are leading to fewer scholarship opportunities across the board. Combining scholarship cuts with tuition and fee increases, the dollar amount of educational loans has grown dramatically even as other forms of consumer debt have remained static or even decreased. According to an article in Texas’ Star-Telegram, “Total student debt was $550 billion at the end of the second quarter [of 2011]…up 25 percent from $440 billion in the third quarter of 2008…” The Project on Student Debt reports that some two-thirds of students graduate from college with educational loans and the average amount of these loans is up substantially.
All of these factors are compelling many to question whether the cost of college is worth the value of a degree. On the one hand, some claim that college degrees are overrated, not nearly as imperative as students are led to believe. Richard K. Vedder, Ohio University professor of economics and founder of the Center for College Affordability and Productivity, notes that “eight of the ten job categories that will add the most employees during the next decade – including home-health aide, customer service representative, and store clerk – can be performed by someone without a college degree.” Vedder recommends that rather than encouraging high schools across the country to prepare every student for college, they work to prepare every student for the workplace instead.
For me, the more compelling evidence is found on the side of the argument reinforcing the importance of higher education in America. Aside from the fact that if we devalue college educations in this country, we are sure to continue to outsource our highest paying jobs to other nations, the value for the individual consumer is also consistent. According to the Lumina Foundation’s September 2010 report titled, “A Stronger Nation through Higher Education,” “It appears that increasing attainment can actually drive economic growth – and therefore job creation.” The US Department of Education’s National Center for Education Statistics notes that in 2009, students with only a high school diploma or equivalent could expect to make a median salary of around $33,000 while those with a bachelor’s degree could expect upwards of $51,000. It is important, however, that colleges and universities examine their fixed cost models and evaluate alternative delivery methods capable of decreasing the costs from the current levels that are increasingly unaffordable.
As the debate continues, it is important to qualify my assertion that college is worth its cost by saying that it is equally as important that students make informed and educated decisions about which college or university they attend. Comparing institutions can assist potential students in determining which schools offer the best values, most well-rounded programs, most successful advising services, etc. In the long term, an individual with a college education is more likely to earn more over the course of his or her lifetime than someone with only a high school diploma or equivalent. The nation as a whole benefits from having a highly educated citizenry. If we discourage our young people from attending college, we will undo generations of hard work toward demonstrating that education is important while simultaneously falling behind our international competitors.