How the Great Recession Proved the Value of a College Degree | Hacker News Reader

How the Great Recession Proved the Value of a College Degree

theatlantic.com

64 pointstokenadult64 comments

The value of a college degree is that it is correlated with other things, many of which are desirable to employers. That is all.

No, the value of a college degree is that, at least when the graduate has taken college seriously, it provides education. You can be smart, successful, ambitious and curious and not go to college - but you probably won't be educated.

The absolute best and easiest way to become educated - if you care about that at all - is through college. This isn't some eternal mathematical truth. It's just that as of today, there are very few ways of getting education without going to college and learning from teachers who know the best way to approach a subject, and who can direct you to things that you in particular might find enlightening.

I think that's the real value of college, and unless you'd otherwise be poverty stricken, this value far exceeds that of the material gains.

"It's just that as of today, there are very few ways of getting education without going to college"

Easily the most outlandishly wrong statement I've heard in years. Except for a very narrow set of STEM courses (such as analytical chemistry) the vast majority of a college education comes about through nothing more than reading books and writing papers. This is something that many folks are entirely capable of doing on their own.

Edit: The strongest proof I have for this sort of thing being the case is the prevalence of people with the "wrong" degrees. For example, one of the most talented developers I worked with was a physicist by education. One of the reasons why this sort of phenomenon is so hard to study in the developed world is because pretty much any individual with the dedication to study any subject is going to be able to get a 4-year degree in that subject in some way (the cheapest way being 2-years of community college for a transfer degree then another 2-years or less at a state school). Given the value of a college degree as a credential there are very few people who wouldn't make that choice.

Engineering degrees require access to expensive equipment and software. Autodidacticism won't magically make a gamma-ray spectrometer appear in your basement.

How many undergraduate college students ever interact with a gamma-ray spectrometer? Indeed, how many ever come into contact with any equipment that is outside the realm of access to an individual studying on their own? Many perhaps, but as a percentage of all college graduates, not that much. Not even all STEM majors require such specialty equipment, and STEM students are a relative minority in college enrollments.

>the vast majority of a college education comes about through nothing more than reading books and writing papers

You went to a shitty college, I guess. Or maybe didn't realise what was going on around you?

(I'm not normally that mean to folk on the internet, but you totally earned it with that ridiculous opener.)

I did make an exception for certain subjects. And no, I went to a good college and I enjoyed the experience. Some of which, such as working with 600 MHz NMR spectrometers and the whole plethora of chemistry laboratory equipment, is very much not the sort of thing one can learn at home. However, such degrees are not the norm. I also studied mathematics, and though many of my professors were quite excellent I have little doubt that motivated self-study with the appropriate books would have produced an equally valuable education in the subject. And that's probably the case for the average course of study. Computer Science? English? Foreign languages? Linguistics? Astronomy? Art? History? Economics? Environmental science? Psychology? These are things that are well within the grasp of self-study, especially today.

"I have little doubt that motivated self-study with the appropriate books would have produced an equally valuable education in the subject"

Much easier said than done. The course plan, deadlines, and grade that are parts of a university course force motivation that often does not exist in self-study. In my case, I've only engaged in "motivated self-study", when I have been very motivated to solve a narrow problem and my studying was similarly narrow.

As I said, pretty much anyone with the motivation to see their own education through is probably just going to go to a cheap college and get a degree as well, since the cost floor on a degree is pretty low for most people in, say, the US. However, I suspect that the advent of ebooks and educational software is going to radically change the landscape. To the degree where people 40 years from now will look at the higher education system we have today and think it is utterly preposterous and primitive.

It's just that as of today, there are very few ways of getting education without going to college

I'd say this was mostly true 20 years ago, sort of true 10 years ago, and utterly false today.

  > I'd say this was mostly true 20 years ago, sort of true 10
  > years ago, and utterly false today.

Remarkably, I've yet to meet one of these effortlessly self-educated men of the Internet age. Checking out a couple of Calculus videos on KA doesn't make you an engineer. In fact, despite current advances (Udacity, Coursera, what have you), I'd argue that the kind of person who manages to self-educate to a sufficient degree today would have managed just as well 20 years ago.

Libraries and textbooks did exist back then, you know. Your comment comes significantly too early.

> Remarkably, I've yet to meet one of these effortlessly self-educated men of the Internet age.

In my experience, pretty much anyone who can program well is self-educated. They might have also done a CS degree, but most of them were programming on their own beforehand.

The mechanics of programming are usually self-taught, but able to write code that compiles != educated. In my experience those with degrees in mathematics or physics tend to be much better at producing value through programming than those without.

Absence of proof is not proof of absence. What has changed in the last 20 years is Internet. My son surprize me with the thing he learned from the internet.

Though it is also true that the things he learned are limited to what catched his curiosity. With classical education you get a more wider and uniform education, but also more shallow than if you dig the knowledge by yourself.

Note also that education plays only a significant role in hiring the next few years after it. After that it's what you have achieved and your expertize domain that become the most relevant.

> "No, the value of a college degree is that, at least when the graduate has taken college seriously, it provides education"

My post never said anything to the contrary. In fact, I am just starting graduate school so I certainly believe in the education it provides -- at least to me.

* To elaborate on my original post, what I was getting at is that not everyone who goes through college will make a good employee, and not going to college doesn't automatically make someone a bad employee.

For instance, my degree is in chemical engineering but I have been programming since I was twelve. I could probably do a good job in a programming career despite the fact that I don't have a CS degree just because of the sheer amount of free time I've spent learning about programming.

At least in the US, you're more likely to get someone better suited for a technical job if they have a degree in that field. It's not at all guaranteed, but there's a decent chance.

The textbooks written by those teachers you speak of are often available for download on the internet.

On a percentage basis, especially outsid of STEM, most of curriculum is irrelevant to employment.

Possibly an invalid correlation. All of those people who went to college also have more affluent families with better connections (I know many college grads that are still working for their parents or friends of their parents...doing paperwork jobs that their psych degree has nothing to do with). Also, a better graph might be to show what a person's debt looks like after college, how long it takes to pay off, etc.

I think a college degree has a huge amount of value, but the catch is getting a college degree in 2012 is much more expensive than say 1992. I see kids and parents going into huge amounts of debt and that's also a big issue which will haunt us well after the Great Recession is over.

Amusingly, I have a polisci/philosophy with a minor in history and I make my money in computer science. I never viewed college as a tech school, I viewed it as an avenue to study things that expanded my mental frames of reference.

Perhaps that's why I'm not just a pure coder but also a biz dev, marketing, and operations resource for the companies I've worked for.

Abstract thinking with an understanding of how it applies to multiple problem sets is far more valuable than sheer technical knowledge.

edit: damnit, misfire. This was meant for another post.

I think this is over-hyped. Yes, it can cost $250,000 for four years at an ivy league school. I can also cost $25,000 for four years at an accredited institution in your home state, less for an accredited institution in some countries.

And yes, college costs have gone up faster than inflation and so on college hour per work hour basis it is more expensive, there are yet options for folks across a wide range of abilities to pay.

This doesn't really prove the value of a degree, just the value of having been "vetted" by a credible entity, and also having higher average intelligence.

What I'm really concerned about is if this ends up sparking an arms race for more education for the sake of careers. A master's degree, depending on the subject and the institution, may not necessarily be the biggest time investment, but it's still a significant financial commitment. And where will this end? Will PhD's end up being necessary for the great recession of 2038?

The masters degree industry is already entirely propped up by unions and governments and other employes with formulaic hiring rules and pay scales.

Those stats show that grads have stayed employed.

They don't show that those people have stayed employed by taking "do you want fries with that" jobs from the non-grads. Receptionist? College degree. Janitor? College degree. Walmart greeter? College degree.

Here's another chart from the same publication:

http://www.theatlantic.com/business/print/2011/08/chart-of-t...

If you're in debt out the wazoo to work at a minimum wage job, then no, the college degree is probably having a net negative effect on your life.

I don't doubt there is some truth in this. Certainly if an employer can choose between a college grad and a high school grad for the same job / pay they may feel they are getting a better 'deal' with the college grad.

That the population of folks with degrees has less unemployment than the set of folks who don't have degrees has been true at least since the 50's according to the Census data. (and they have nifty new APIs to access it but alas they are down at the moment). What is less well understood are the roots of this correlation.

At one time people assumed that folks with college degrees had higher IQs or higher socioeconomic status, but later studies have not born out that hypothesis. There is something different about someone who decides to finish a college degree, in the general case, than someone who either pursues no college, or starts college and drops out.

There are of course anecdotes of college drop out successes and college graduate failures, but as a population group they seem more employable overall.

So far from the data I've seen it seems there is an aspect of this question which is not yet well quantified.

Do you have sources or is this pure speculation?

I live in a foreign country but when I come home to the USA to visit, I still see mostly teenagers working at fast food restaurants.

The thing is, most managers at minimum wage jobs wouldn't want to hire a college graduate. They would feel threatened since they probably don't have a degree themselves.

I have not really seen this attitude, and I've worked a few shitty jobs post education. (I get a perverse satisfaction from shifting beer barrels)

The types of jobs traditionally filled by those with high school educations disappeared disproportionately (manufacturing, construction). i.e. high school educated people are increasingly useless to our economy. This means two things: firstly non-college prep high school curriculum is failing to prepare citizens for any non-college niche of our economy. Secondly, they face higher competition for the remaining non-skilled jobs.

Also a net negative effect on your life: unemployment.

> high school educated people are increasingly useless to our economy.

That seems like a silly statement. The jobs that most college graduates are fighting for were once, and often still are, done quite successfully by high school educated people. It is not that education matters in the workplace, it is just that the demand for those jobs has kept people trying to increasingly outdo everyone else in order to get the job. Education has been an easy way to do that.

Education doubly serves as an easy filter. You have probably heard your parents say something like "in my day you only needed high school." That is because there were less high school graduates during that time. If you threw away the resumes without high school, you could pare them down to manageable levels. In the meantime there was a big push to see more high school educated people. Suddenly, filtering by high school yielded too many results. Degrees were still relatively rare, so applying that logic allowed the filter to work again. But then the big push for college education started...

53% of recent college graduates are underemployed or jobless[1]. This seems to indicate that having a bachelors is not even enough anymore. "Everyone" has a bachelors degree these days, so why hire one of them when you can hire someone who has a masters degree?

The economy would do just fine if we had more high school (or less) educated people, but we would have to find some other filter, like gender, race, or religion and we have already decided that no company may filter based on those attributes. That leaves the infinite arms race of education where it is still socially acceptable to consider those without said education "stupid" and unfit to do the job.

[1] http://blog.fora.tv/2012/04/the-new-53-unemployed-college-gr...

College-educated people being hired for jobs that high-school educated people used to do is only part of the problem. The other part of the problem is that those jobs are disappearing. That was the major point of the research article that this is report is based on. So, it's all fine and dandy for college-educated people to whine that they're only able to find jobs for which they are over-qualified, but high-school educated people face both increased competition from college-educated people and fewer opportunities (even if college-educated people were not encroaching) and can't find jobs at all.

Keep in mind that 70,000,000 high school graduates in the USA are employed, while only 35,000,000 college gradates are employed. High school educated people have a long way to go before they are completely marginalized by college graduates. You make it sound like there are just a handful of high school educated people hanging on to the last jobs by the skin of their teeth, which couldn't be further from the truth.

I feel it is also important to note that the college educated gains made in this study were by people aged 25 or above. Those below that age are actually more employed with just a high school education for the first time. We can surmise from that data that experience is what has become important in the recession, which is also backed by my anecdotal experience. It is just that a degree actually did matter a decade ago, which left those without a degree lacking in the necessary experience today.

>If you're in debt out the wazoo to work at a minimum wage job, then no, the college degree is probably having a net negative effect on your life

Usually it is the reverse:

If you're in debt out the wazoo due to a college degree and forced to work a minimum wage [low wage] job, then college is having a negative effect on your life...

People who are motivated, who love learning, and who know how to create value can be successful without a college degree.

The degree generally doesn't hurt, though.

Exactly. Correlation != causation.

I wonder how many of these jobs are government jobs?

Overall public sector employment has dropped significantly over the last three years.

Reuters: "The last three years of job losses at the state and local government level has been the most dramatic since Labor Department records began in 1955"

http://www.reuters.com/article/2012/04/08/usa-states-employe...

From what I heard, if we had retained existing public-sector jobs through the recession, we'd be back at net job-gain by now. Our apparent "job losses", at this point, are solely due to cutting state and local government jobs.

Interesting - this looks like a huge missed opportunity.

According to Keynesians, job losses in recessions are caused by sticky nominal wages and insufficient inflation. But in the case of government, nominal wages can be reduced by fiat.

So why didn't we simply reduce the pay of government employees rather than reducing their number?

I assure you that - virtually always - layoffs are a last resort.

Furloughs, pay cuts, and reducing headcount through attrition have become almost ubiquitous on the state and local level over the past few years.

Um, no.

http://research.stlouisfed.org/fred2/series/ECIGVTWAG

What has this got to do with anything?

The article assumes that all four-year college degrees are equivalent, but if I had to guess, people with computer science degrees had different outcomes in this recession than people with philosophy degrees.

Perhaps that's why I'm not just a pure coder but also a biz dev, marketing, and operations resource for the companies I've worked for.

Abstract thinking with an understanding of how it applies to multiple problem sets is far more valuable than sheer technical knowledge.

It's a good thing, then, that a CS education also trains you in abstract thinking applied to multiple domains. Subjects like mathematics (especially more abstract branches) and CS (especially theoretical CS) are some of the best options for expanding your mind and gaining new perspectives.

Despite the name, computer science isn't actually about computers or even technology. At its core, it's the study of information--very much a dual to certain branches of math and even certain branches of philosophy. "Computer" is just the name given to essentially all the tools used to study information and computation.

Having immediate practical applications does not mean CS doesn't also have significant depth!

Discussions about macroeconomic conditions aren't about people like you. You are a very small minority. You probably also went to a pretty good school. I would not advise a random eighteen year old to pursue your path, and isn't that what we're talking about?

Another article I read recently said that the gains were made by people above the age of 25. This actually indicates that experience became the important factor of the recession, though the degree may have been important prior to the recession in order to build that experience.

The facts are there, but, I believe, if you're a hustler, a self-starter, an entrepreneur - You're going to make it work for yourself, one way or another, with or without a college degree. Because it's all you know.

Likewise, if you don't have passion, you're going to have a much harder time competing with other degree-holding passionless people. You know, the kind of people that spend 8 hours/day blindly applying to shit on Monster.com instead of doing something different and standing out.

I can't tell if your're serious with the first point. Either way I reject the idea that a person can be successful simply by possessing a positive attitude. Or that facts should be dismissed for anecdote.

Having the right attitude doesn't always lead to success, but having the wrong attitude always leads to failure. There is a positive correlation between those who are strong willed and determined and those who complete college, which most likely explains why college graduates tend to fare better in the workforce – graduates generally all share that same attitude, whereas non-graduates are a mixed bag.

I succeed a lot with a terrible attitude. Go figure.

That's the biggest false dichotomy, piled on top of a whopping huge tautology, that I've ever seen.

EDIT: Ok, you deserve more explanation than that. Claiming that "true hustlers" will always succeed is the tautology, because after all, it means someone who doesn't succeed mustn't have been a true hustler. It also sounds like something a drug-dealer says to satisfy their success. "Hustle" is a positively-connoted abstraction that doesn't actually mean much, rather like "work ethic" or "education".

The false dichotomy is the one between "entrepreneurs" on the one hand and mindless 9-5 drones who produce little and deserve nothing on the other. This one is, like "hustle", a very small phrase that wraps up a very large Just So Story people tell themselves to justify their own position in life while dealing with the cognitive dissonance of knowing deserving-seeming people who don't have what they have.

the hustler, self-starter, and entrepreneur is the last person who should forego college. college is one of the most efficient places to learn the lessons of millennia of hustle, starting, entrepreneurship that proceeded you.

it is also an invaluable place to make important personal and professional connections with professors and fellow students.

Is there a causation/correlation analysis missing here?

Yes.

I think jellicle makes a good comment on this issue, as he usually does on education policy issues. The chart shown in the submitted article does not "prove" that college degrees have economic value, in and of themselves, up to the present value of the lifetime difference in earnings between degree holders and people who lack degrees.

The report underlying the chart

http://www9.georgetown.edu/grad/gppi/hpi/cew/pdfs/CollegeAdv...

goes into more details. I have followed the writings of one of the report co-authors, Anthony Carnevale,

http://chronicle.com/article/Minding-the-Midpoint-Where/1288...

http://www.nationalreview.com/phi-beta-cons/302016/mellowing...

for years, and his earlier writings include reports on college access for low-income, high-ability students,

http://tcf.org/publications/2010/9/how-increasing-college-ac...

showing that colleges preferentially admit by ability to pay rather than by intelligence or ability to gain from college studies (a finding consistent with the advice given by consulting firms that advise colleges on admission practices)

http://www.maguireassoc.com/

so that the job-market success of college graduates does not show so much that college education as such improves the qualities of workers as it signals to the job market which job applicants were most advantaged before college age.

Many college students are actually academically adrift,

http://thechoice.blogs.nytimes.com/2011/01/17/academically-a...

and Carnevale is a thoughtful writer about what both colleges and the students who attend them have to do to gain the best benefit from college attendance. So when I submitted this link (which was emailed to me by a local friend this evening), I was hoping it would gain the several thoughtfully disagreeing comments it has gained since I posted it, so that we can distinguish the benefits of attending college as such (which still need to be enhanced in the typical case) from the signaling effect of being admitted to college (which indubitably has some strong benefits in the job market, varying by college major and by industry).

The OP's chart is meaningless because of selection bias. Presumably, the college grads would be more employable because of higher intelligence, greater access to resources or better habits, which led them to college (I know there are many exceptions to this).

The real question is, what would many of those college grads have done otherwise in those 4 years, with the money they would have saved?

FWIW I learned a ton about myself in college and wouldn't trade that experience for anything.

Another problem with this data is that it doesn't show percentages of college educated people, the total number of people in employment with college degrees has also been growing. The right metric is to look at percentage unemployment in each of these segments, not total numbers.

About 50% of the working population have some kind of post-secondary education, including community college diplomas and apprenticeships. Roughly 50% of that group (or 25% of the total working population) have a college degree.

> The right metric is to look at percentage unemployment in each of these segments

I would take it even further and break up the high school or less demographic. Someone who could obtain a degree, but chose not to/was unable to attend college is not at all like someone who has no chance of graduating no matter what the circumstances. They really shouldn't be lumped together if we are trying to promote the business benefits of attending college.

If you have the opportunity to go to college, you have already demonstrated characteristics that are appealing to employers that are not present in the rest of the demographic. Due to the presentation, it is not clear in any way if college actually add any additional value or if those people would have achieved the same results regardless.

I'd be curious to see how much of the job growth is coming from those with Masters and above.

So perhaps a neo-credentialist-Keynesian solution would be to have the government print up college degrees for mailing to the 6 million un-degreed unemployed?

You joke, but that works if labor is under supplied because employees are afraid to hire non grads. (Real world example: blacks were banned from military combat roles, due to racism, until we an out of whits for cannon fodder.)

But it doesn't work if demand is too low for supply already.

If merely giving someone a degree-in-name, rather than actually educating them, would result in happy employers and higher overall employment, then there's something deeply wrong with (a) college educations; (b) employer evaluation standards; or (c) both.

(I don't doubt that there are deep problems in both those areas, and my jest was intended to suggest their character.)

LOL - This is true in non recession times also...

It is also not because of the degree - It is because these individuals have a stronger work ethic and 'try harder' to succeed in life.

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