Have we put college degrees on a pedestal?
We are becoming ever more conscious about the products we consume and the companies we support. It might be time we do the same for higher education.
When I graduated high school in 2007 skipping college would have been unfathomable. Everything before college was framed to be preparation for the real deal, the true test, the big leagues. If I didn’t pursue the golden bachelors degree, my parents would give me the old, “we’re not mad, just disappointed” talk and I’d be flipping burgers at the BK Lounge for the rest of my life.
While high school grads may still have similar expectations, many could still be working at The Lounge after graduation – with an extra serving of $20k of debt.
For many millennials this right of passage has become a burden. Today’s cost of higher education and the job quality a degree earns has diminished the value of a degree and rightfully has us questioning whether going to college is really worth it the investment.
This TEDx from February (12min) succinctly covers the productization of our education systems and offers a consumer-driven approach to revolution. Find a brief summary of the talk below.
“Even a bankrupt gambler gets a second chance but it’s nearly impossible for a student to have their student loan debts discharged.”
How College Loans Exploit Students for Profit, Sajay Samuel
Q: Why are college grads returning home to live with their parents after graduation and working at coffee shops?
A: Our education system is driven by profit which has turned a college degree into a product and undermined the reason we go to school. It’s taken a toll on the passion of learning and
Three main points:
- Higher education is a consumer product
- Today we talk about higher education as an investment as if we are economists.
- Degrees have become a way to classify students as they graduate so employers can hire them more easily, not a pursuit of knowledge or passion.
- The US News and World Report ranks colleges just as The Consumer Report ranks washing machines.
- The industry refers to teachers as service providers and students as consumers.
- Sociology, Shakespear, soccer, science… are all content.
- The whole package is profit-driven.
- Student debt is profitable
- Student debt fattens the profit of the student loan industry.
- Sally Mae and Navient (two student loan giants) – posted a combined profit of 1.2 Billion in 2014.
- Just like home mortgages, student loans can be bundled, packaged, sliced, and diced, and sold on wall street.
- Colleges and universities that invest in these securitized loans profit twice. Once on your tuition and once again on the interest from your debt.
- Diplomas are a brand
- “When students are treated as consumers, they are made prisoners of addiction and envy”
- Upselling education “college is the new high school” but why stop there. People can be upsold on certifications, re-certifications, masters degrees, and PhDs.
- Higher education is marketed as a status object. Buy a degree, much like you do a Lexus or a louis Vuitton bag, to distinguish yourself from others, so you can be the object of envy of others.
The Facts About The American Education System:
- In 2015 40 Million Americans were indebted for their passage into the new economy.
- From 2000 to 2012 state and federal funding for education decreased by 18.5% per student.
- Between 2000 and 2012 higher education costs increased by 62%.
- Average annual wages have declined for every educational category.
- 45% of students who enroll in higher education do not complete it in a timely fashion.
- 33% of college graduates remain underemployed.
The Bottom Line:
- Tuition Costs Are Up
- Public Funding is Down
- Family Incomes Have Diminished
- Result: 25% can’t make their student loan payments
It’s time to demand to know what we are paying for. Maybe education should have a warning label that helps potential students make more informed decisions. When you buy a car it tells you how many miles a gallon to expect. But most students go into college blind on the recommendation of others that education is a must.
Why would you pay more for college if you aren’t going to earn more when you get out?
If consumers start treating education like a product:
- Administrators would be incentivized to manage costs better.
- The cost of majors would change depending on how much a student can make with their degree upon graduation.
Whenever we buy anything else we consider the return we will get for our money… It’s time we do the same with higher education.
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