Colleges lose pricing power
online.wsj.com
online.wsj.com
"'We have a more informed class of college consumers,' said Bonnie Snyder, founder of Kerrigan College Planning in Lancaster, Pa. 'Everyone today knows someone who went to college and ended up with a career that didn't justify the cost. They see college as a more risky investment.'"
Yep. More and more of us know more and more examples of college graduates who live in their parents' basements because they can't support themselves with their college diploma. It's time to be more discerning consumers of higher education.
Colleges try to confuse the issue of their value with imaginary list prices subject to discounts ("scholarships") that mislead about what a college is actually worth. Here's an interesting link about how colleges are advised to set their prices by consulting firms, a link I learned about from a Harvard-trained economist and policy analyst:
http://www.maguireassoc.com/services-challenges/optimize-net...
http://chronicle.com/blogs/conversation/2012/11/26/the-net-p...
The lack of transparency in the discounting process is deplorable. I ended up trying law study via an online correspondence school - a terrible idea, with hindsight, due to the social isolation - because the B&M schools' scholarship policy seemed so arbitrary and opaque that I was unwilling to take the risk of becoming liable for $ix-figure up-front tuition costs if I didn't play my cards right. This hasn't done my continuing education/career prospects any good, but in mid-life I don't feel comfortable playing poker for >$100k of non-dischargeable student loan debt.
Many college degrees are an indication that you have the determination to spend (aka waste) a big chunk of your money and youth to prove your ability to persevere, or indicate to other people that you're made of the right kind of stuff. The older I get, the more dismissive I am of college (undergraduate level) as anything other than a social marker.
I am not dissing college, bu let's compare fairly: college isn't free, it requires lots of time and money.
Source? Or just speculation? I for one, know many people living in basements, but not a single one of them has a college degree. Anecdotal evidence only goes so far.
"It's time to be more discerning consumers of higher education."
Higher education is as necessary today as it has always been, and will continue to be for the forseeable future. We need trained professionals to work on highly technical areas, or we can't progress. How else are we going to have mechanical, aerospace, electrical, chemical engineers and many other professions?
This doesn't mean that a college or university is for everyone though. It is left to each person to balance the very subjective pros and cons of deciding whether to go to college or not. Also no students are forced to attend highly expensive colleges, since most of the time there exists a high quality public institution available.
Over half of recent college grads are underemployed or unemployed. This figure used to be lower in the past. But the shift is smaller than I was honestly expecting, and largely can be attributed to the economy.
Yes, we'll always need STEM people, but I think you're forgetting that STEM is a pretty narrow part of what colleges do. Heck, I've got a buddy who has his degree in Theater. Theater! Why that is a degree option at a university, I have no idea. Not to mention art, comm (which every other person seems to major in), History, English, etc.. These are a little more representative of the "basement" ex-college goers.
For non-technical people, I kind of feel like college is a pretty poor investment. Going to a vocational school would probably pay off more in the end.
The devaluation of the college degree is partly because of the gross amount of people who go to college for no reason other than to socialize and enjoy themselves.
I know a number of folks who simply fed their curiosity, and still ended up in productive lives. Indeed, the original purpose of an undergraduate degree was to expand one's horizons. Graduate school was the time and place to focus on profession.
I think that this was a pretty damn good investment, and I certainly understand why it's a degree option. So that people can learn how to do it.
So nobody learned how to do it before it was a degree option?
What does a degree give you that an apprenticeship wouldn't?
The benefits of a liberal arts education span through the actual degree department too.
Now, does anybody have something to say on philosophy degrees, or ancient Greek, or does my opinion get to stand on those?
I was actually a music composition major before I switched to CS. I don't have anything against non-STEM fields. However, one day I looked at how much I was paying for school, how much I stood to earn, and what hard skills I would walk away with when everything was all said and done, and decided switching to my other love, CS, was a much better way to spend my time at uni.
Aristophanes? Shakespeare? A lot of actors learn their craft ithrough studying theater.
Maybe because theater is a big business. Disney makes Broadway shows and Cirque du Soleil is a billion dollar business.
But that's beside the point. High quality university education is not trade school. If you have a liberal education you should be ready for a wide range of tasks.
Yes, some people make a lot of money doing Broadway, but on the whole, I'd wager that the bulk of "actors" live on "getting by" wages. How many steady $60k+ gigs are out there for the taking?
All that said, I may be the victim of sample bias. Though I was never a thespian, my core group of friends growing up consisted mostly of theater people in high school, and then onto college, I still hung out with many thespians, and now, the bulk of them are.. waiters/"actors." There are a couple that are working near constantly, but for very little money; Maybe a couple of hundred dollars for two weeks of shows.
What about the remaining 82% and 85%? What fraction of these project an increase? It's not mentioned, so perhaps there's also been a similar rise in the fraction that projected an increase, and all you can say then is that there's increased variance in projected revenue change, not that universities on average are facing projected revenue decrease.
I would put forth that administrative costs are increasing faster than faculty costs. No hard evidence to back it up, just a lifetime of studying how organizations & bureaucracy grow.
I would also put forth that college life is increasingly cushy. The dorms at my alma mater are amazingly nice, compared to when I went there. I lived in a converted motel run by the university. Today's students have suites, with kitchenettes, free cable TV, reserved parking, and a fitness center. I'm not saying it should return to the barely-better-than-prison experience I had, but there needs to be a limit set, because all that stuff adds to the semester's cost.
The irony is that when colleges want to pay faculty less or cut benefits, students protest and call them greedy.
Healthcare alone is growing by xx% a year and employees expect a raise each year. Building repairs and everything else is also increasing, year after year.
How about letting the free market decide, instead of forcing students to live on campus?
Ye good folk States-side need to quit slamming on 'college education' and start complaining about the 'costs of education'. Education is just learning. Maybe some sources of education are better than others, and in particular for some fields, but you shouldn't throw the baby out with the bathwater, and keep railing against university, which really just opens up opportunities, and lets somebody who knows more than you choose what you should learn.
Although, to qualify, I choose graded self-study courses where possible, because I'm kinda a dick as a student.
If you mean the financially elite, then actually in the US the top private universities are often more affordable for the non-elite. For instance, if your family income is under, I believe, $100k, Stanford waives tuition. If it is under something like $70k, they also waive room and board.
It's actually the top state schools, such as the University of California, that are the hardest for the non-elite to afford (especially for students from out of state).
Also, many of the top private universities don't take transfer students--non-elite students often have to work for a few years before attending college, and it's unpleasant to find out that having tried to take what community colleges you can afford in terms of time and money while holding down a full time job to keep a roof over your head has literally made you ineligible to apply almost anywhere except a state run university (who also tend to heavily discriminate against transfer students).
Even for your example, Stanford, transfer admissions are significantly more selective than normal admissions processes:
"Transfer admission is considerably more competitive than freshman admission. In recent years, the admit rate for transfer students has ranged from 1% to 4%. Between twenty and fifty transfer student spaces are typically available each year."
This further increases the ability of Stanford to keep its student body composed of financial elites--while touting its "generous" financial aid policy. Plus, even an 18 year old applying to Stanford requires SATs, extracurriculars, etc that most of the non financial elite are unable to afford. Most college applications are at $80/pop nowadays; if you can only afford one college application, why pick the university you probably won't be accepted to?
This just isn't true. The student body has a diverse range of incomes, and the financial aid policy is indeed generous sans quotes. The aid packages of Stanford and its peers made them cheaper than in-state tuition minus financial aid at the University of Texas for me.
There is considerably moral hazard in allowing students to omit the financial information of estranged parents. People would "disown" their children to get free tuition.
If you have no family support, you need college more, not less. Of course, places like Stanford are far more concerned with turning a profit than enrolling poor people.
You'll note that the median family income of a Stanford student is $125,000, which is more than double the median family income in the US as a whole. Maybe that's not a lot to you, but it's almost inconceivable to someone who was raised, say, in a family making 12-20K/year.
(You complain that people would disown their children to get free tuition, but forget the fact that before it became profit oriented, Stanford used to have free tuition for everyone--no disowning required.)
Its a shame that not more people opt for vocational training instead of university, then expecting to get vocational training at a university, all the while complaining it costs so much more.
I am horrified that we have so little place for others whose passion is in other directions. Man can not live on bread alone, and society can't flourish on software alone. It is heartbreaking that in our increasingly efficient world, where production of food, shelter, and even medical care for all should be trivial, they seem to be harder to reach for many.
We should have more room for the humanities now, not less. It should be possible for more people to pursue philosophy and literature and theater and art and music for the rest of us to enjoy.
An indication that something that clearly can't go on forever is in fact starting to come to an end is very likely to be correct.
At which point I stopped reading. The WSJ is a political instrument.