The U.S. Questions the Value of Higher Education

In the wake of the economic crisis, the U.S. is facing a paradigm shift with regards to the importance conferred to higher education. Increasingly, people are questioning whether the academic qualification is worth the investment.

The question has become so widespread that the new term “education bubble” has been created to describe the effects of the widespread cultural idea that everyone should go to college.

“This tendency to revert the ‘university is for all syndrome’ is not new,” said economist Robert Lerman, who studies education and employment in the Urban Institute in Washington. “But with unemployment at 9.1 percent, the attention increases.”

On one hand, the market is not able to absorb the horde of college graduates; on the other hand, the debt acquired to pay for expensive universities already exceeds American credit card debts and is likely to reach $1 trillion in 2011.

In 2010, 68.1 percent of those who finished high school were enrolled in universities the following year, according to the Bureau of Labor Statistics. Between 1972 and 1980, the rate was 50 percent.

However, only 56 percent of those university graduates in 2010 have had at least one job since graduation. Another 22 percent are unemployed, and 22 percent are working in jobs that do not require a degree.

“The big problem is that we do not develop high-quality alternatives for those without a college degree,” says Lerman. This is bad for students and for the productivity of the country.

This change in attitude is already visible in surveys. This month’s Pew Institute survey shows that over half (57 percent) of American adults believe that higher education is not worth the amount spent to graduate.

The skepticism is linked to the sky-rocketing cost of courses. While consumer inflation rose about 107 percent from 1986 till the end of 2010 in the U.S., tuition has increased by 467 percent over the same period.

According to the College Board, a four-year university diploma costs an average of $30 thousand for those going to public institutions (which are not free), and $109 thousand for private institutions.

Despite the debate, the data also shows that those who have a bachelor’s degree do better in the American market. Unemployment for this group, 4.5 percent, is less than half compared to those who have only high school diploma (9.7 percent).