VIEWPOINT / A FULLY EXPECTED SURPRISE

By Timothy Weaver, Ph.D.

A recent AOL news story was titled: “Jaded With Education, More Americans Are Skipping College.” The article addresses the multi-year trend in which the proportion of high school graduates attending college has declined—in numbers, about 8%. The pandemic seems to have accelerated the movement but is not the actual cause. The real reason is the rising cost of attending college. Many lower and middle-class families are being priced out of college attendance. The culprit? Massive tax cuts at the state and federal levels have reduced the proportion of college costs borne by the government and increased the burden on families.

This condition was as predictable as the apple hitting Newton on the head. The Republican Party has finally stalled the middle and working classes in their quest for upward mobility. Whether a conscious goal or just a hidden consequence of the more extensive agenda to shift wealth from the middle and lower middle to the upper classes, this condition was inevitable. The net result is fewer middle and working-class kids who would otherwise qualify to select college as their first option for getting ahead. 

Either by design or default, the educated politicians who engineered this outcome also benefit as fewer college degrees in the next generation mean a more significant advantage for their offspring. Do you think John Roberts’ kids will or are going to college or borrowing money to start a lawn care business? What about Alito? McConnell? McCarthy? As I have written before, the relative advantage of a college degree declines as a greater percentage of a given cohort obtains one. My guess is that this latent effect (pricing the middle class out of college) was a happy accident.

To reinforce my argument, 95 percent of today’s House members and 100 percent of the Senate have a bachelor’s degree or higher. Naturally, 100% of SCOTUS members have advanced degrees.

I would make an educated guess that the percentage of Congressional and Senate offspring attending or graduating college, or planning to do so, is about the same as their parents—very high. Why do you suppose these highly educated and well-off families would want to block others from attending college by giving rich folks the money in tax breaks they could otherwise be appropriating for college subsidies?

The average college graduate will make 70% more than the non-four-year college graduate over a lifetime. It may be wise for certain people to avoid attending college, and the college ROI greatly depends on the selected major. Overall, the advice would result in a lower standard of living and many more disgruntled and angry Americans who fall behind. The average high school graduate will be in the workforce until 2073. The trade learned today may suffice for a time, but technology and AI are moving the bar higher at the speed of light. I would not want to rely on being an electrician, carpenter, or plumber with today’s skills and lacking a college degree for the next 50 years. 

I say this because the baccalaureate degree is necessary for the next level, an advanced education. The cost factor is another matter addressed in detail in another VIEWPOINT column. Even with the best efforts of the Republicans to price the middle class out of the college market, it remains a good investment. Folks can always choose a trade at any stage of life. However, if you don’t choose college as a high school graduate, the odds rise steeply that you will never attend college.

The one thing missing in many studies on college ROI that I’ve reviewed is the effect of sequential matriculation, meaning that one cannot advance to the next level without completing the prior level—with rare exceptions. What is the value of a bachelor’s degree absent the ticket to go to the next, a master’s degree, and after that, the next, another master’s or doctorate? As our analysis at the Syracuse University Policy Institute showed decades ago, the relative advantage of completing any stage of education decreases as a higher proportion of a given cohort completes that level. There is a tipping point where earnings tied to the relative advantage begin to fall as that advantage disappears. At that stage, the real ROI of completing that stage is the opportunity to go to the next level. 

Think about high school graduation. In 1940 less than half of Americans graduated from high school. High school graduation conveyed a relative advantage in earnings in the labor market at the time. Today, that advantage has disappeared. The only real value in completing high school now is to be able to go to college, whether two or four colleges, financially speaking. 

As college completion nears 40%, the relative advantage conveyed by graduating begins declining. If college graduation approaches 60%, a downward spiral will start. Does that mean four years of college are worthless? Absolutely not. Graduating college becomes a necessity for going to the next level—a master’s degree. As many realize, this is already happening, and it will continue. The education process has a built-in systemic function to produce an internal demand for more education. Pretty tricky, huh?

https://freopp.org/is-college-worth-it-a-comprehensive-return-on-investment-analysis-1b2ad17f84c8

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