It is ironic that politicians in the presidential race are touting “free college” and student loan debt relief to buy votes. (Let’s put aside the fact that anything free is undervalued—the students would have no “skin in the game.”) The harsh reality is that there are not nearly enough suitable jobs. (Since the year 2000 there have been about 20,000,000 bachelor’s degrees conferred while the number of full time jobs has declined by 2,000,000.) Only about one in four enrollees gets a good job, and, for many, the expenditure has little or no return on investment due to the high cost.
I recently had the opportunity to chat with a college sophomore in one of our state universities. James had flunked out of the journalism school during his freshman year. In the fall semester of his sophomore year he was taking four courses—twelve hours. He had signed up for three English courses—his new major—and The History of Rock and Roll. James is on a track that, optimistically, will lead to a bachelor’s degree after five years. Given the rate of inflation of college costs his total cost of attendance is going to be in the neighborhood of $150,000. His major and his academic performance is unlikely to lead to a well-paying job. (Half of all graduates end up unemployed or under employed per Department of Labor data.) I didn’t know James well enough to ask him about student loan debt, but the average today is $35,000. If he has the average amount of debt, he is going to end up with a serious financial problem. There are thousands of students in college today like James.
Your student is probably going to need a credential to succeed in life financially. Fifty years ago a bachelor’s degree was the “no-brainer” choice because college was (relatively) cheap and only seven percent of high school graduates matriculated. However college doesn’t work the way it used to. The “sweet spot” today is community college. The cost is low, and Pell Grants are available for many students. If you carefully research your options, your kid can gain a credential that will lead to a well-paying job.
“Free college” and student loan debt relief is not what is needed. The economy needs more good jobs, and parents and students need to do a better job of planning for post-secondary education. Today about three out of ten high school graduates are enrolling in community college. Better choices by parents and students would cause that number to double. (The added benefit is that your kid won’t be part of the fifty percent of twenty-five years-old young people living is their parent’s basement.)