University of Virginia

The College Jobs Gap

The Wall Street Journal reports today that as bleak as the job picture is in America right now, those faring best are college graduates:

The unemployment rate for workers 25-and-older with a bachelor’s degree or higher was 4.6% in August, for example, compared with 10.3% for those with just a high-school diploma. That’s a 5.7-percentage-point gap, compared with a gap of only 2.6 percentage points in December 2007 when the recession began.

Clearly the current economic malaise has increased the relative value of a college degree.  But let’s look at some other numbers.  A recent survey found that the number of people that thought college was a good investment dropped from 79% to 64% over the last year, a reflection on the rising costs.  Also, a diploma no longer guarantees a wage that rises faster than inflation, as the WSJ story mentions.  Quite a contradiction:  if you want to increase your chances of getting a job, go to college; but, the job you get might not give you the earnings you need to offset the huge cost.

Maybe there’s something else going on here.  Maybe there are more variables than simple summary statistics can measure.  Are the students that make the most of their college years doing better than those that slide through?  Are responsible, hard-working kids doing better in the employment world than those with entitlement syndrome?  The numbers won’t say, but parents probably know the answers.

What can you do, other than worry?  (1) Make sure your college costs are as low as possible, following a good college funding plan can help with that.  (2) Realize that behind all these statistics are real students and what is “right” for your son’s best friend might not be right for your son.  By being proactive, you can resist the pressure of getting caught up in what everyone else is doing.  Investigate the options, keep an open mind, and continue to communicate with your teenager.  (3) Don’t get too locked-in to numbers like those reported above, they’ll be different in a year.  What you should get locked-in to though are the principles and values that you are teaching your kids as you take on the college process.