What Happened....

[ChiTownScion]

I had an interesting conversation this weekend with one of the kids. She followed the Accepted Script, graduated at the top of her class from high school, went to college, got her degree, and is working full time as a children's librarian, for $12 an hour. She has to work at the theatre part time to make ends meet. She is 28 years old.

$12/hour is more than a lot of fulltime workers make around here, so that part of it doesn't bother her so much. Except that the library a couple years back hired an ex-convict right out of prison with no background in libraries at all and no degree of any kind as a tech director -- at $15 an hour. "Why'd I bother to go to college?" she asks. "I should have embezzeled $25,000 from my parents like that guy did, except they've never had $25,000 in their lives."

This month's Consumer Reports has a very compelling article about the current-day college finance racket. Well worth reading if you're a millennial or have millennials that you care about.

There was a time when very few who had other employment options wanted to go to work for the public defender's office (or, contra, the prosecutor's office) and make a career of it. The game plan for most was to put in a few years, get trial experience, and then market it to a firm (or hang out the shingle and go solo) after a few years. And yes: the horror stories abounded when I hit the bricks decades ago as well about no jobs and licensed attorneys driving cabs, etc. I stuck with it because, against all impulse, I became a True Believer and actually derived a lot of satisfaction from what I was doing. It didn't happen regularly, or often, but every now and then a victory was garnered for a client who was essentially a god and decent person.

Times have changed. Now, if a person sticks for ten years they can have their law school student debt washed away nearly as much as the sins of a Baptist at a revival meeting. Kids coming out now are routinely carrying more than five times the debt that I faced on the mortgage of my first home. Student loan forgiveness - even partial- pays off better than marrying the boss's daughter, apparently.

 

[EngProf]

This is only a small slice of the college-grad/debt issue, but it's my part, so I'll relate it here. As a member of both our Departmental and School Career Committees, I know what the average debt-level and average starting-salaries are for our 4-year engineering grads.
The absolute debt level is much higher than the debt level when I graduated, but the starting salaries have increased to the point that the salary to debt ratio is just about the same. They are no worse off than our generation.
Our people graduate, get jobs, and live happily ever after. (The first two items they do for sure, since I have the statistics. The third item I hope they do.)

At the graduate level, one advantage of engineers is that they NEVER have to pay for their Master's or Ph. D's. Unlike Law or Medicine or ??, they get paid for their graduate work, while receiving free tuition.

 

[Paisley]

Former mechanical engineer here. BSME, military veteran, passed the FE exam, won a design competition, excellent communication skills--I had all the things companies swore they couldn't find. Result: I made $7.50 an hour my first year out of engineering school working at Sears warehouse. I later made $13 an hour (less than grocery store cashiers, and no benefits) as a mechanical engineer working alongside other engineers who'd been out of work for a year at a time. At the time I left my last job as an engineer, I'd been sending out resumes for four months without any responses. I went into secretarial work to make more money--I had bills to pay and mouths to feed and needed a real job, not flaky, shaky project work where I didn't know whether I was still going to have a paycheck next month.

A few months ago when I was looking for work and applied for an admin job at an engineering firm, and they asked if I was applying for an admin or engineering position:

"I want to make sure I am clear in understanding that you prefer an administrative role as opposed to an engineer as we have openings for both in our Indianapolis office. The reason being, is that the engineer is paid more towards the rate you are seeking..."

The "rate [I was] seeking" what what I'd been making as an admin at a CPA firm--and what another CPA firm just offered me.

Further reading: "The STEM Crisis is a Myth." IEEE.
Falling Behind? Boom, Bust and the Global Race for Scientific Talent by Michael S. Teitelbaum.

 

[Paisley]

I had an interesting conversation this weekend with one of the kids. She followed the Accepted Script, graduated at the top of her class from high school, went to college, got her degree, and is working full time as a children's librarian, for $12 an hour. She has to work at the theatre part time to make ends meet. She is 28 years old.

$12/hour is more than a lot of fulltime workers make around here, so that part of it doesn't bother her so much. Except that the library a couple years back hired an ex-convict right out of prison with no background in libraries at all and no degree of any kind as a tech director -- at $15 an hour. "Why'd I bother to go to college?" she asks. "I should have embezzeled $25,000 from my parents like that guy did, except they've never had $25,000 in their lives."

This month's Consumer Reports has a very compelling article about the current-day college finance racket. Well worth reading if you're a millennial or have millennials that you care about.

A former coworker told me about her husband's son or daughter, who got a $100,000 liberal arts education and now prepares bills for a law firm. It's a lot more complicated than it sounds (I interviewed for the same job at another firm) and it pays pretty well...but still.

If your young friend is deep in debt, she could hit the road and make some serious coin here.
http://www.indeed.com/q-Truck-Driver-l-Indianapolis,-IN-jobs.html

 

[HudsonHawk]

My wife and I are putting a granddaughter through college. It's an arts school in Portland, OR and she wants to get her degree in computer animation. That's what I call a specialty with a real future. Shell probably get a well-paying job right out of college. If I hadn't been able to break in as a novelist, my degree in English would have put me on the fast track to homelessness.

The biggest problem is not that too many kids are getting college degrees, it's that they're getting degrees and still having no useful skills to show for it. If what you learned in college is not in demand by employers, then the degree is pointless, no matter how many people tell you "they just want to see that you have a degree".

 

[Harp]

The biggest problem is not that too many kids are getting college degrees, it's that they're getting degrees and still having no useful skills to show for it. If what you learned in college is not in demand by employers, then the degree is pointless....

A college education should not simply be viewed as a means to gain employment. Most college graduates will work in three or four different fields before retirement
and college will probably not directly prepare an individual for the market-excepting physicians, scientists etc. Liberal arts study teaches inquiry, reason, and factual examination
of the past and present while affording an inner exploration of self. I advise kids to take the most difficult courses under the most demanding instruction, to advantage the leisure
of campus and youth in terms of time that adulthood and its attendant responsibilities will consume. Foreign language, classical music, philosophy, literature, mathematics, science
pursued during college tenure will pay dividends later in life.

 

[LizzieMaine]

All my favorite kids have liberal arts degrees. The problem is not that they have such degrees, it's that they were told their entire lives, by parents, teachers, and by guidance counselors, that *a* degree, *any* degree would be their ticket to a well paying, secure job -- and now they're left holding the bag.

I had a guidance counselor in high school who tried very hard to sell me on the idea of going to Bowling Green University in Ohio to study popular culture. He told me I could become an author, a researcher, or any number of other valuable jobs. Well, I thought the idea of paying what was, I think, $7000 or so a year to live in Ohio and watch movies and read comic books for four years, was kind of dopey, so I passed. Turns out I did become an author and a researcher, and have made a fair amount of money at it without having to pay $7000 a year to go to Ohio and watch movies and read comic books, so I think I made the right decision.

 

[HudsonHawk]

A college education should not simply be viewed as a means to gain employment. Most college graduates will work in three or four different fields before retirement
and college will probably not directly prepare an individual for the market-excepting physicians, scientists etc. Liberal arts study teaches inquiry, reason, and factual examination
of the past and present while affording an inner exploration of self. I advise kids to take the most difficult courses under the most demanding instruction, to advantage the leisure
of campus and youth in terms of time that adulthood and its attendant responsibilities will consume. Foreign language, classical music, philosophy, literature, mathematics, science
pursued during college tenure will pay dividends later in life.

I think we're pretty aligned here. So let me rephrase...it's not that too many kids are getting college degrees, it's that too many expect that a degree itself is a ticket to the job they want, even it doesn't equip them with the skills employers want.

 

[HudsonHawk]

All my favorite kids have liberal arts degrees. The problem is not that they have such degrees, it's that they were told their entire lives, by parents, teachers, and by guidance counselors, that *a* degree, *any* degree would be their ticket to a well paying, secure job -- and now they're left holding the bag.

I had a guidance counselor in high school who tried very hard to sell me on the idea of going to Bowling Green University in Ohio to study popular culture. He told me I could become an author, a researcher, or any number of other valuable jobs. Well, I thought the idea of paying what was, I think, $7000 or so a year to live in Ohio and watch movies and read comic books for four years, was kind of dopey, so I passed. Turns out I did become an author and a researcher, and have made a fair amount of money at it without having to pay $7000 a year to go to Ohio and watch movies and read comic books, so I think I made the right decision.

Reminds me of the scene in Office Space:

Lawrence: What would you do if you had a million dollars?
Peter: Nothing. I'd do absolutely nothing.
Lawrence: You don't need a million dollars to do nothing, man. Just look at my cousin...he's broke and don't do !@#$.

 

[GHT]

All my favorite kids have liberal arts degrees. The problem is not that they have such degrees, it's that they were told their entire lives, by parents, teachers, and by guidance counselors, that *a* degree, *any* degree would be their ticket to a well paying, secure job -- and now they're left holding the bag.

You have hit the nail right on the head. A degree has value only if the degree is scarce, and the MBA that is my degree, is completely unscarce. Schools’ reputations have suffered from promoting themselves as a route to enhanced future salaries, the value of a degree is linked to the prestige of an institution, rather than what it teaches, but few people have been listening. People don’t hear what they don’t want to hear. Only if you went to an elite university, would a degree like an MBA, be worth something, otherwise it's a complete waste of money.
However, my degree, was paid for by my employer, (at the time.) I did the course in two years, not the three recommended. So easy was it that I also stayed at work part-time. But it was beneficial, I already had a higher educational qualification known as an HND or Higher National Diploma in Business Studies. The MBA was almost a re-run of that HND. The best education was working in business, I was lucky to have found a quality company prepared to invest in their staff, when they recognised their staff's talents.

 

[Fading Fast]

In ways, I see the college market problem as being similar to the housing market problem we went through in '08 and on. We (the private and public sectors) made graduating college a goal for "everyone" because college graduates earn higher wages. However, once we (the public and private sector, through programs and incentives) drove the number of college graduates up, the supply of college graduates outstripped demand and the price of a college degree (the wage a college graduate earns) dropped (and many couldn't even find jobs). And, of course, these programs and incentives also created all this student loan debt to pay for the increased number of college graduates which, based on a backwards look only at a much smaller supply of college graduates, argued could be easily be paid off by the higher wages that the new college graduates were supposed to earn (but, now, don't).

This is all similar to the housing market. "Owning a home" was viewed as a good "social goal" as statistics showed that homeowners, over time, accumulate more wealth, have more stability, improve communities, etc. Hence, we created public and private programs that encouraged more and more people to own a home and, to do this, we created a mountain of debt just like the student loan debt problem we are facing now. But that debt wouldn't be a problem - we were told - as long as house prices kept going up like they had in the past. Unfortunately though, along the way, like with college graduates, we ended up with housing supply well outstripping demand. We all know what happened once that happened - the price of homes fell (like the wages college graduates earn) and the debt defaulted. Think of the foreclosed home without a buyer as the college graduate without a job - there was just too much / many of both.

In both cases, our hearts were in the right place - since college graduates and homeowners have these positive things happen - earn more, accumulate more wealth, etc. - we created all these public and private incentives and programs to increase the number of these good things. If we take on debt to do so - so be it - it will all be paid off by the increased earnings / wealth. What we missed was that once you dramatically increase the supply of something - college graduates and homeowners - the price of those things - wages and house prices - fall and the debt taken on to acquire those things - a college degree or a home - becomes unsupportable and default and bust follow.

This is dramatically oversimplified, but the parallels are interesting.

 

[Harp]

A degree has value only if the degree is scarce, and the MBA that is my degree....

When I was in law school I worked the overnight trade desk for a Chicago commodity brokerage and considered a MS in Financial Markets and Trading at the Illinois Institute of Technology.
Eventually I discarded the idea and instead just read through all available commodity trading literature. The Black-Scholes theory and a lot of calculus inside a classroom really could not
compete with the market itself.

 

[LizzieMaine]

Granted there are certain fields Where The Money Is, what happens to the kids who simply have no aptitude for those fields? Howard Scott to the contrary, a society built up entirely of engineers couldn't function, nor could a society built up entirely of financiers, lawyers, or whatever other Where The Money Is field you care to name. And not everybody has the aptitude to function in one of those fields. A society that doesn't put a reasonable material value on art, literature, or the social sciences is a society headed down the road to barbarism, no matter how much money the engineers and financiers make.

 

[Inkstainedwretch]

For me, college was about broadening one's outlook. That's what the liberal arts are for. When I talk to young people who are hesitant about ending up with a useless degree I tell them, "You'll never regret that you're educated."

 

[Harp]

When I talk to young people who are hesitant about ending up with a useless degree I tell them, "You'll never regret that you're educated."

I gave a Michigan pre med Boethius' The Consolation of Philosophy; which surprisingly he had not read at his Jesuit high school, nor did he ever attend a ballet, opera, symphony,
or the Art Institute, and suggested he explore all that he had missed despite Medicine being a jealous mistress.

 

[Fading Fast]

Granted there are certain fields Where The Money Are, what happens to the kids who simply have no aptitude for those fields? Howard Scott to the contrary, a society built up entirely of engineers couldn't function, nor could a society built up entirely of financiers, lawyers, or whatever other Where The Money Is field you care to name. And not everybody has the aptitude to function in one of those fields. A society that doesn't put a reasonable material value on art, literature, or the social sciences is a society headed down the road to barbarism, no matter how much money the engineers and financiers make.

I think I agree, but I'm not sure I'm fully following the argument. Today, with all the extra cable TV channels and direct TV streaming services, I assume a lot more people are making money writing, directing, doing camera work, editing, etc. in TV than back in the days of three networks. Also, museum attendance is up dramatically decade over decade as just two examples. And artists who could never reach an audience before, seem to have more access with the internet - certainly more authors are publishing, etc. To be sure, many aren't making a lot doing that, but at the end of the day, if they have access and aren't generating demand for their material, that unfortunately is the way the world works.

Hence, are these fields not offering opportunity? Is society not paying for art and literature (or at least books)? I know of almost no field not experience "disruption" as every single business model is going through excruciating change brought on the digital / technology ongoing revolution - my field has been blasted apart. But - and again, I think I might have missed your point - it seems to me that the creative fields have been attracting both investment and consumer spending money (I'm sure not all of them and, of course, different skills within those will be in or out of demand).

And you mention lawyers, other than the big-time top paid ones - it seems that field is shrinking as my lawyer friends (again, other than the big-pay ones) are struggling to find jobs, are getting paid less and are always worried about their jobs. Just putting out some observations and trying to understand your point better.

 

[LizzieMaine]

Most people who study the liberal arts don't end up writing or acting or directing movies and TV. I'm thinking more of high school English teachers trying to survive on $35,000 a year. They're the only ones standing between us and subliterate barbarism, so you'd think they'd be worth a bit more to society.

I realize that's the way the world, or at least our corner of it, works. I just don't agree that the world should work that way.

 

[Fading Fast]

Most people who study the liberal arts don't end up writing or acting or directing movies and TV. I'm thinking more of high school English teachers trying to survive on $35,000 a year. They're the only ones standing between us and subliterate barbarism, so you'd think they'd be worth a bit more to society.

I realize that's the way the world, or at least our corner of it, works. I just don't agree that the world should work that way.

Got it - missed it the first time. In the NYC area, many (not all) teachers do, IMHO, very well. I have several friends and family members who are / have been teachers and they make substantially more that $35k and, if you consider not only the salary, but the time off, the pension and health benefits and job security - I would encourage a young person to go into teaching in this region. That said, I know that even in this area, not all school systems pay well and, of course, as you point out, in other parts of the country the story isn't so good.

Part of the problem is there are more people who want to teach than there are teaching positions, so it is hard to employ them all and to argue to taxpayers we need to pay them more when there are so many qualified ones willing to work at the current pay level. Even if you increase the pay, you can't magically increase the number of jobs. And, of course, if you increase the pay, then something else has to give - budget cuts elsewhere or tax increases neither of which are popular with the voters.

 

[HudsonHawk]

Granted there are certain fields Where The Money Is, what happens to the kids who simply have no aptitude for those fields? Howard Scott to the contrary, a society built up entirely of engineers couldn't function, nor could a society built up entirely of financiers, lawyers, or whatever other Where The Money Is field you care to name. And not everybody has the aptitude to function in one of those fields. A society that doesn't put a reasonable material value on art, literature, or the social sciences is a society headed down the road to barbarism, no matter how much money the engineers and financiers make.

I'm not suggesting everyone do Where The Money Is, only that we're doing them a disservice by telling them Money Is Everywhere. I think we all agree on that.

 

[ChiTownScion]

All my favorite kids have liberal arts degrees. The problem is not that they have such degrees, it's that they were told their entire lives, by parents, teachers, and by guidance counselors, that *a* degree, *any* degree would be their ticket to a well paying, secure job -- and now they're left holding the bag.

I was told on Day One of college at a "welcome new freshmen" convocation that an apprenticeship in the electricians' union would likely grant me more cash in the long run than an undergrad degree. So I went into this college thing with no delusions.

A liberal arts degree is a great first step. It isn't an end. It enriched my life, but it never really in and of itself earned me a nickel. What you do with it is far more of a factor in upward socioeconomic mobility than the degree itself. Yes, I needed it to go on to law school, but there's really more to it than that.

Personally, what I learned as an undergrad was invaluable in reminding me later on what a minute, even miniscule, corner of the total body of human knowledge that which I spent years in law libraries trying to master really occupies. Of all the people I have ever encountered, there are damned few (and I count our Lizzie as one of those rare individuals) who can achieve that perimeter of education outside of a college classroom.

As an illustration, take two guys working for the same large corporation. Let's suppose one holds a bachelor's degree in business management from a middle tier university. Let's suppose the other holds his undergrad degree in a liberal arts field- history, or economics major- from the same university, and also has earned an MBA from a university of comparable ranking. I'd argue that the guy with the MBA will likely go farther- all else being equal (and I admit: that's a big "if")- simply because his work related education dwells within a larger frame of reference than the guy who "just knows his field." He understands the wider scope of the world as a whole just a bit better. It's a life experience not unlike serving in the military in wartime, only in the sense that both life experiences bring you into contact with personalities and experiences that if you're prudent in learning from them can be helpful in the future to understanding the perimeters of your immediate experiences.

I'd also point out that much of what you learn as an undergrad is what your peers impart... both positive and negative. But that's a subject for another tirade, I suppose.