Tuesday, August 16, 2011

Has the Higher-Education Bubble Popped?

Has the Higher-Education Bubble Popped?

Doug French of the Mises Daily thinks so: The Higher-Education Bubble Has Popped 

"Among the members of the class of 2010, just 56 percent had held at least one job by this spring, when the survey was conducted,' reported the Times recently. 'That compares with 90 percent of graduates from the classes of 2006 and 2007.'

And because they can't find jobs, 85 percent of college grads move back in with their parents after they graduate. According to a poll by Twentysomething Inc., a marketing and research firm based in Philadelphia, that rate has steadily risen from 67 percent in 2006."

The Los Angeles Times Counters

College: The Smart Choice: "Let's assume that you're a high school graduate and you have $102,000 to invest in your future. Is college your best bet? Or would you be better off putting the money into an alternative investment, like stocks or bonds, and earning the salary of a typical high school graduate over your lifetime?"

Ben Casnocha is More Extreme. In his article Who Should and Should Not Be Going to College, he segregates his recommendation by high school under-achievers (discourages), high achievers (encourages), and a 5-10% very high achievers. For the very high achievers he suggests the "Real Life University", finding mentors and advisors and chasing the entrepreneurial rabbit.    

The Bottom Line

Let's assume that I am tall, rich, and smart... Jeffrey Tucker at the Mises Institute scribes a poignant lament "overeducated, underemployed, and with no marketable skills: the U.S. looks more and more like a European-style welfare state," as the well educated take jobs that would have gone to the less educated.   

The 2+2 formula - two years community college, then two years at a four year college is likely to gain traction. You get your degree from a great school and would still have $40k+ in your pocket.