Saturday, March 30, 2013

The third myth of college



 

“You pay your fee and get your B.”

--description of less than reputable schools in my area

That's not the myth, though. Here it is:

"College degree holders earn a million dollars over a lifetime."

 

     This myth was posted on the walls at my college and, I suspect, is posted at many institutions. Money is a powerful motivator, for learning or anything else, so the intentions are good by posting it…but this is a deceptive myth. There’s nothing wrong with viewing a college degree as a financial investment, any more than viewing a college education as a source of personal growth. Unfortunately, institutions are not above using the myth of making so much more money with a degree to justify the ever increasing cost of tuition, and, in turn, the likewise increasing loans taken on by students.

     This myth is far more damaging than the others, and people honestly believe that because they’ll be ultimately making more money, it’s worthwhile to take out loans.  There’s a grain of truth to this insidious myth, but only a grain. If you subtract “super-earners” from the college graduates (the upper 1% of the top 1% of college degree holders), the rare souls that earn a great many millions or even billions, the actual average would drop substantially, but the true deception is the “over a lifetime” part of it. Allow me to write something that terrifies my students, and many administrators: let’s do some math!

      The average annual income for a janitor is $25,000 (and there aren’t any “super earner” janitors). Consider the six years it takes an “above average” student to get a degree. If, instead of going to college, an 18 year old coming out of high school worked for six years as a janitor ($150,000), took that money and invested it for forty years, at 4%, compounded annually, he’d have over $720,000. (As an aside, most incoming students, even with a calculator and the formula directly in front of them, cannot perform this calculation.) If this janitor could get 5% annually, he’d have over a million dollars and still not be 65 years old, better off than a college graduate, according to the myth, and with another decade or so of life still to live!

      The math says most people are financially better off being janitors than going to college, and yet going to college is presented as economically a good idea for everyone.

     Think about that: many a college graduate would be better off financially if he had just scrubbed toilets instead, and that’s not even factoring in the student loan, or accounting for those that don’t graduate. I’ve left off life expenses as a janitor, but life expenses for a student are probably no more than for a janitor. Granted, in the 2012 economy making a secure 5% a year is not a given—but with over half of college graduates unable to find a relevant job in the current economy, scrubbing toilets is still a better deal than being un- or under-employed with a vast student loan to pay off. If children were told a more honest myth, that “People that go to college generally don’t do as well financially as janitors,” would so many be willing to sacrifice years of their life and enter eternal debt slavery to go to college?

     Particular jobs (engineering, for example) do require a college degree, and those jobs tend to be higher paying. If you’re specifically going to college for the specific degree for exactly one of these jobs, and you can get that degree, and that job, then college and a loan does make financial sense. But to extend the favorable risk/reward calculation for these particular jobs to all degrees, even those in such generally unprofitable fields as Ufology, is foolish.

     To repeat the myth of how much money there is to be made just because of having a degree, any degree, is to repeat a lie. For institutions to rationalize raising all tuition for all coursework on the basis of higher salaries for a few jobs based on a tiny minority of that coursework is unethical at the very least, and just pulls in suckers.