Every so often, someone in the higher ed establishment does a bit of cheerleading for the team –proclaim that college degrees are so beneficial that the country should try to put far more young people through college.
The most venerable such effort is a report that the College Board puts out every three years entitled College Pays. Here is the most recent in the series. The formula is the same every time: point to the fact that on average, people who have finished college earn more than people who haven’t, then call the difference between those averages the “college earnings premium” and imply that the causal factor is having gotten that degree.
Related: Gary Becker Is Wrong to Say College is Still a Good Investment
In addition to those higher average earnings, we’re also told that college education creates huge benefits for society: better health and longevity, more steady employment, higher rates of voting and civic engagement, among other social goods. In this view, college isn’t just a private benefit that confers increased earnings on graduates, but a public good that makes the whole nation better off.
Writing in The Chronicle of Higher Education, Philip Trostel, a professor at the University of Maine at Orono, has just reprised that number. He argues here that getting a college degree is “practically a windfall-profit investment for most” Americans and that the benefits of college go “way beyond the earnings premium.”
Close to ‘Fake News’
Trostel starts with the supposed lifetime earnings premium, which he calculates at $1,383,000, before adding that the premium is probably going to increase since it always has. Therefore, even if a student paid “full sticker price at an elite college,” getting that great earnings boost would still make it “a great investment.”
That claim is very close to “fake news.” Assuming it’s true that on average individuals who have college degrees earn significantly more than individuals do without them, it doesn’t follow that any person in the latter group will necessarily gain a large earnings boost just by virtue of earning a degree. After all, the types of people who are drawn to higher education are different from the types who aren’t. They tend to be more talented and ambitious.
Furthermore, the earnings data this comparison relies upon are necessarily drawn from the past. The problem is that at many schools, a college education just isn’t what it used to be. Standards have declined for both admission and academic performance. Students today don’t have to work as hard and many apparently derive little or no intellectual benefit from their years in college.
Going forward, there is no reason to assume that the “college premium” will be nearly as large as it was in the past. Financial firms know to advertise that “past performance is no guarantee of future performance” and a college economics professor ought to know to be similarly cautious.
What About Side Benefits?
Besides, there is plenty of evidence that large numbers of recent college graduates, far from earning more, are working in the same kinds of jobs as people who have only high school educations, and they are struggling to pay off their college loans.
As this paper published by the Center for College Affordability and Productivity explains, the labor market has become saturated with workers who have college credentials (but often not the skills that are in demand) and many are underemployed. And a recent study done by the Federal Reserve Bank of New York finds that for the last two decades, around one-third of college graduates have wound up working in jobs that do not call for any higher education.
If the claimed earnings gain is for many students just a mirage, what about those other social benefits? True, they correlate with college completion, but that does not mean college completion will cause them. Again, the two populations tend to have different characteristics. Those who are inclined toward post-secondary education are on the whole more inclined to have healthier lifestyles and more social attributes than those who are not.
Think of it this way – even if you could focus on a guy who barely graduated from high school and loves to drink and smoke, and lure into college and manage to get him through to a degree, is that likely to change his behavior? Probably not. (Nor will he probably have learned as much of value to himself and society in college compared with what he’d have done while working in the real world.)
Does College Improve Behavior?
Just as it’s a mistake to think that having a college degree causes higher earnings, it is also a mistake to think that having a college degree causes people to behave in more desirable ways.
Finally, as Frederic Bastiat taught, good economists look for unseen effects as well as those that are easily seen. There is a large cost to college other than the obvious financial one, namely the fact that so many students pick up terribly mistaken ideas in college. It’s primarily on college campuses that young people become imbued with such progressive notions as social justice, white privilege, sustainability, intersectionality, anti-capitalism, institutional racism, microaggressions and more.
On many campuses, intellectually weaker students can get through by taking lots of “experience learning” courses which simultaneously build up their GPA (since an A is almost guaranteed as long as you say politically correct things in your “reflection papers”) and make them believe that social problems are caused by freedom and can only be solved through government activism. (The recent report from the National Association of Scholars, Making Citizens, is extremely valuable for making that point.)
Spending our limited resources to under-educate young people so they’ll support leftist causes and candidates is doubly damaging.
An Expensive Credential
Trostel laments that “access to college education may well continue to be compromised, which makes not just the potential students who are deterred, but all of us worse off.” The trouble with his view is that the students who might be deterred – and in recent years the percentage of high school graduates who go on to college has declined somewhat – are overwhelmingly going to be the academically marginal and disengaged students for whom college is just an expensive credential.
America’s sharp students are in high demand and can easily obtain the loans, grants, and scholarships they need for college and post-graduate studies. If more students who don’t have their ability decide that some other kind of education or training after high school is better for them, that is no cause for concern.
We can’t pull ourselves up by the bootstraps by promoting the “college for everyone” agenda, but by trying we waste resources and diminish the college learning experience.