When College Might Not Be Worth It(libertystreeteconomics.newyorkfed.org)
libertystreeteconomics.newyorkfed.org
When College Might Not Be Worth It
https://libertystreeteconomics.newyorkfed.org/2025/04/when-college-might-not-be-worth-it/
98 comments
Weirdly enough, my dad spent roughly the same on my college (in Ireland).
I had no hopes nor expectations as to how my degree would end up being of benefit. It allowed me to see another part of the world, and "learn how to learn" so to speak.
I ended up doing another course in computing at the same time, which I had to pay for myself, using any and all free time I had during the college course, paid for by a shitty call center job I managed to get which paid, at the time, about EUR 3,60 / hour.
Later on, I went from approx. 1000 EUR / month in my first professional gig as a Java dev, to doubling that in the same establishment by getting promoted.
Then I got hired by a fortune 500 and left my country of origin (not Ireland) which paid....so much more. Then founding a startup, and now...
My conclusion is that the learning-to-learn aspect of it is of utmost importance. I think college is great for learning how to learn, even more than the content of what it happens to be that one is pursuing.
I had no hopes nor expectations as to how my degree would end up being of benefit. It allowed me to see another part of the world, and "learn how to learn" so to speak.
I ended up doing another course in computing at the same time, which I had to pay for myself, using any and all free time I had during the college course, paid for by a shitty call center job I managed to get which paid, at the time, about EUR 3,60 / hour.
Later on, I went from approx. 1000 EUR / month in my first professional gig as a Java dev, to doubling that in the same establishment by getting promoted.
Then I got hired by a fortune 500 and left my country of origin (not Ireland) which paid....so much more. Then founding a startup, and now...
My conclusion is that the learning-to-learn aspect of it is of utmost importance. I think college is great for learning how to learn, even more than the content of what it happens to be that one is pursuing.
> In Ireland my college cost €3000 per year and most got it for free through government grants.
That's a great deal. My local university costs $10k per semester.
That's a great deal. My local university costs $10k per semester.
Cheers, keep going!
Grinds my gears to see every discussion of college ROI look at tuition and majors, but always the "Average" or "typical" student, NEVER segmented by, e.g. socioeconomic background.
If you can afford college, it is absolutely worth it to go to college. For a variety of reasons, ROI not top of the list.
If it may be hard for you to afford college, then it's a better question to ask.
If you can afford college, it is absolutely worth it to go to college. For a variety of reasons, ROI not top of the list.
If it may be hard for you to afford college, then it's a better question to ask.
I dropped out of college after stumbling my way through several majors and I still consider it to be a formative experience. But I have another problem with this: American primary and secondary education is terrible. College is the first time so many get exposed to things that are critical: the classics, high level math, statistics, etc.
Making college less necessary starts with improving primary and secondary education.
Making college less necessary starts with improving primary and secondary education.
College is the first time so many get exposed to things that are critical: the classics, high level math, statistics, etc.
Are you saying Americans don’t take stats, calc, or English lit in high school?
Are you saying Americans don’t take stats, calc, or English lit in high school?
My friend somehow made it through to senior year without ever taking a math class. To graduate the counselor put them in the cafeteria serving lunch, which somehow counted towards a math credit.
Public school in Hawaiʻi man.
Public school in Hawaiʻi man.
If you go to a quality private school, certainly. In public school? Most don't even get close, and the standards get lower by the year.
Yes they teach all that in high school here
Most Americans don't even take stats or calc in college.
Yes
> If you can afford college, it is absolutely worth it to go to college. For a variety of reasons, ROI not top of the list.
This is complicated by the fact that the mission of the university and of education in general has become muddled. There is also an intellectual crisis that plagues academe (like the silos separating the liberal arts and the sciences). The two intertwined and at times competing missions are that of educating the person and that of career preparation. Arguably, the latter is where the bulk of energy is going; I don't know where you can locate the former, in general.
So, in that light, you have to ask: are universities the best option for everyone...
a) from the perspective of job training?
b) from the perspective of education?
Not everyone is called to go to university.
This is complicated by the fact that the mission of the university and of education in general has become muddled. There is also an intellectual crisis that plagues academe (like the silos separating the liberal arts and the sciences). The two intertwined and at times competing missions are that of educating the person and that of career preparation. Arguably, the latter is where the bulk of energy is going; I don't know where you can locate the former, in general.
So, in that light, you have to ask: are universities the best option for everyone...
a) from the perspective of job training?
b) from the perspective of education?
Not everyone is called to go to university.
That's not true. I afforded it. It probably had a positive ROI, though it's extremely hard to tell. But I regret going, it wasn't the experience I needed or was looking for. Talking to some others later in life, I wish I had taken a different path. Going straight into work would have been far better. I don't lament how my life turned out or anything, but there were a couple of decisions I made, including uni, where I nearly went another way, but followed a path of least resistance instead. Just a small bit of advice would have really helped. My parents didn't step up in that regard.
1. Doing something practical ahead of college is always in order.
2. As someone trying to finish the PhD, there is zero ROI, due to closeness to retirement. If genuine intellectual curiosity were not the driver, it would truly be a waste of time.
2. As someone trying to finish the PhD, there is zero ROI, due to closeness to retirement. If genuine intellectual curiosity were not the driver, it would truly be a waste of time.
As a YC backed college drop-out, I think there is enormous character development value in a college education. It is a great segue into real/high-value commercial endeavors. It teaches you so much more than "something practical". It's not about the formal pedagogy per-se, but the community and learning to navigate it.
> I think there is enormous character development value in a college education. It is a great segue into real/high-value commercial endeavors.
It's a great segue into real/high-value commercial endeavors if you're lucky. For others not so fortunate, they graduate into a Starbucks barista role.
It's a great segue into real/high-value commercial endeavors if you're lucky. For others not so fortunate, they graduate into a Starbucks barista role.
Was there some shame in being a barista?
I'm just a lowly keymasher, but I have a college classmate who is a US Senator. Do I envy him? Why, no; no, I do not.
I'm just a lowly keymasher, but I have a college classmate who is a US Senator. Do I envy him? Why, no; no, I do not.
> Was there some shame in being a barista?
Does this job have compensation/benefits equal to being a lowly keymasher?
Does this job have compensation/benefits equal to being a lowly keymasher?
Well, no.
But that is a different question than the one of shame.
Barista itself is probably not a full career path, but there is nothing wrong with it as a waypoint.
But that is a different question than the one of shame.
Barista itself is probably not a full career path, but there is nothing wrong with it as a waypoint.
Well, using Barista as a proxy for any job that a keymasher might regard as "nothing wrong with it as a waypoint", I guess a person might feel shame after long periods of time trying to get out of that waypoint, and not being able to because they're losing ground to recent graduates and the regular churn of the market looking for people with "more experience".
So yeah, I can see how someone would feel shame in that even if they didn't publicly admit it. An interesting question for you from here is, what do you think about the people who are in "nothing wrong with it as a waypoint" jobs?
So yeah, I can see how someone would feel shame in that even if they didn't publicly admit it. An interesting question for you from here is, what do you think about the people who are in "nothing wrong with it as a waypoint" jobs?
The job is but one dimension of life, and it's really not my task to judge anyone based solely upon their waypoint of the moment.
What else are they doing? Do they have goals? Are they socially connected and building up those around them?
You might see someone, for example, busking on the corner and jump to a wildly erroneous conclusion about them... https://x.com/bluezharp/status/1822666701814608086
What else are they doing? Do they have goals? Are they socially connected and building up those around them?
You might see someone, for example, busking on the corner and jump to a wildly erroneous conclusion about them... https://x.com/bluezharp/status/1822666701814608086
> The job is but one dimension of life, and it's really not my task to judge anyone based solely upon their waypoint of the moment.
You're not engaging with the real and acute problem of, 1) keypusher gets to look at barista and say "oof, no medical insurance, no investments, living paycheck to paycheck" must be their waypoint, hopefully at 10 years deep into that barista career they get their break as a senior ruby engineer, good thing they were "just at a waypoint"
2). > What else are they doing? Do they have goals? Are they socially connected and building up those around them?
Are they healthy? Have they been able to maintain the same level of fitness as someone who works 4 hours a week writing internal tooling vs dodging traffic and dealing with an equally financially unstable manager screwing their ability to pay rent the next week?
Really smitty
You're not engaging with the real and acute problem of, 1) keypusher gets to look at barista and say "oof, no medical insurance, no investments, living paycheck to paycheck" must be their waypoint, hopefully at 10 years deep into that barista career they get their break as a senior ruby engineer, good thing they were "just at a waypoint"
2). > What else are they doing? Do they have goals? Are they socially connected and building up those around them?
Are they healthy? Have they been able to maintain the same level of fitness as someone who works 4 hours a week writing internal tooling vs dodging traffic and dealing with an equally financially unstable manager screwing their ability to pay rent the next week?
Really smitty
> You're not engaging
By what rule am I engaging? It sounds as though there is a hierarchy on offer here, based upon salary/benefits, no?
The point I'm after here is that, while salary/benefits are a relatively straightforward metric, they are not the only metric.
Do we have rules of thumb by which we come to an initial evaluation of situations? Of course we do. But let us leave a little wiggle room and not close the case until the whole situation is understood, say I.
Really, avicebron.
By what rule am I engaging? It sounds as though there is a hierarchy on offer here, based upon salary/benefits, no?
The point I'm after here is that, while salary/benefits are a relatively straightforward metric, they are not the only metric.
Do we have rules of thumb by which we come to an initial evaluation of situations? Of course we do. But let us leave a little wiggle room and not close the case until the whole situation is understood, say I.
Really, avicebron.
The lifetime ROI of college is only 13%?
https://libertystreeteconomics.newyorkfed.org/2025/04/is-col...
Doesn't that mean over the working life of the person (40 years), they spend (1-0.13) * 40 = 34.8yrs paying for the cost of college from their additional earnings?
I think my college was paid for with additional earnings inside of 5 years.
https://libertystreeteconomics.newyorkfed.org/2025/04/is-col...
Doesn't that mean over the working life of the person (40 years), they spend (1-0.13) * 40 = 34.8yrs paying for the cost of college from their additional earnings?
I think my college was paid for with additional earnings inside of 5 years.
ROI (as a %) at 5 years out is going to be much higher than Lifetime ROI. A non-graduate will be able to make up most of the gap they start with.
But are you factoring in the opportunity cost, i.e., the lost earnings of not working for four years during college? That's actually the bigger factor for many colleges.
And then compute the interest / investment gains on those earnings.
And then compute the interest / investment gains on those earnings.
I think it’s the difference between going and not going.
So if you make 100 without college, you’d have made 113 with it.
And I don’t know if loan repayments are factored in.
It could be that college educated individuals wind up with 13% more wealth than similarly situated non-degreed individuals
So if you make 100 without college, you’d have made 113 with it.
And I don’t know if loan repayments are factored in.
It could be that college educated individuals wind up with 13% more wealth than similarly situated non-degreed individuals
It's your annual ROI.
The total investment is 4 years of tuition + 4 years of opportunity cost.
The total return is your salary till age 65 - salary of someone without a degree.
Subtract 1 from 2, annualize it.
The total investment is 4 years of tuition + 4 years of opportunity cost.
The total return is your salary till age 65 - salary of someone without a degree.
Subtract 1 from 2, annualize it.
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That's not lifetime ROI. It's pretty obvious they mean annual, since they compare it to stocks returning 8% and we know that isn't a "lifetime" return.
"Indeed, by comparison, the stock market has provided a long-term return of about 8 percent and bonds have returned around 4 percent."
"Indeed, by comparison, the stock market has provided a long-term return of about 8 percent and bonds have returned around 4 percent."
>The lifetime ROI of college is only 13%?
Yeah, that's BS.
Right off the bat, I'm seeing different numbers[1] for median earnings elsewhere: $60K for college graduates vs. $36K for high-school diploma holders.
I have no idea where they got the $47K wage for high-school graduates from, and it's a substantial difference.
Because the difference between being able to make ends meet, and not being able to make ends meet isn't quantifiable in terms of ROI. Not having to worry about your card bouncing at the grocery store is a step-function-like quality of life increase alone.
What's the ROI of decreased risk of depression and suicide? [2]
Or living 7 years longer, as the article we're discussing acknowledges.
Then, the devil is in the details. Wages of someone with only a high school diploma and 20 years of experience today might be acceptable, but that's because they were able to get into the field with only a high school diploma 20 years back.
The job landscape right now is different, and will be different still 20 years into the future. We all know that a factory worker in the 1950s could get by just fine with only a HS diploma, but lumping their end-of-career earnings with those of a fresh high-school grad entering a dead-end job makes for bad analysis.
Yet this study attempts no such distinction.
Then, there's looking at the toll jobs available to HS diploma folks take on them. With social security and retirement potentially not being an option anymore, that's probably the most important factor to look at today.
I can go on and on; the point is, ROI calculation could make sense, but it is awfully incomplete in studies like this.
And that's ignoring the elephant in the room, which is that colleges are not merely trade schools. College education develops the mind, introduces people to different perspectives and backgrounds - and, on average, creates more informed voters with better critical thinking skills and more ability to resist Russian-style firehose-of-falsehood propaganda.[3]
There is no cure to that, aside from teaching critical thinking (according to the same RAND study) - which Finland has started doing a decade ago, starting from elementary school[4].
That kind of thing is one of a million reasons of why college education (beyond being a trade school with an ROI) is important for the society as a whole.
That, and probably the fact that even if a plumber makes the same as a college-level mathematics instructor, we shouldn't be pushing potential mathematicians to become plumbers for a better ROI.
Just a thought.
[1] https://www.aplu.org/our-work/4-policy-and-advocacy/publicuv...
[2] https://pmc.ncbi.nlm.nih.gov/articles/PMC6739140/
[3] https://www.rand.org/pubs/perspectives/PE198.html
Yeah, that's BS.
Right off the bat, I'm seeing different numbers[1] for median earnings elsewhere: $60K for college graduates vs. $36K for high-school diploma holders.
I have no idea where they got the $47K wage for high-school graduates from, and it's a substantial difference.
Because the difference between being able to make ends meet, and not being able to make ends meet isn't quantifiable in terms of ROI. Not having to worry about your card bouncing at the grocery store is a step-function-like quality of life increase alone.
What's the ROI of decreased risk of depression and suicide? [2]
Or living 7 years longer, as the article we're discussing acknowledges.
Then, the devil is in the details. Wages of someone with only a high school diploma and 20 years of experience today might be acceptable, but that's because they were able to get into the field with only a high school diploma 20 years back.
The job landscape right now is different, and will be different still 20 years into the future. We all know that a factory worker in the 1950s could get by just fine with only a HS diploma, but lumping their end-of-career earnings with those of a fresh high-school grad entering a dead-end job makes for bad analysis.
Yet this study attempts no such distinction.
Then, there's looking at the toll jobs available to HS diploma folks take on them. With social security and retirement potentially not being an option anymore, that's probably the most important factor to look at today.
I can go on and on; the point is, ROI calculation could make sense, but it is awfully incomplete in studies like this.
And that's ignoring the elephant in the room, which is that colleges are not merely trade schools. College education develops the mind, introduces people to different perspectives and backgrounds - and, on average, creates more informed voters with better critical thinking skills and more ability to resist Russian-style firehose-of-falsehood propaganda.[3]
There is no cure to that, aside from teaching critical thinking (according to the same RAND study) - which Finland has started doing a decade ago, starting from elementary school[4].
That kind of thing is one of a million reasons of why college education (beyond being a trade school with an ROI) is important for the society as a whole.
That, and probably the fact that even if a plumber makes the same as a college-level mathematics instructor, we shouldn't be pushing potential mathematicians to become plumbers for a better ROI.
Just a thought.
[1] https://www.aplu.org/our-work/4-policy-and-advocacy/publicuv...
[2] https://pmc.ncbi.nlm.nih.gov/articles/PMC6739140/
[3] https://www.rand.org/pubs/perspectives/PE198.html
Long story short, given that a academic loans are just as undismissable as a criminal judgement, school is a scam.
And since having a degree guaranteees absolutely nothing, doubly so.
And since having a degree guaranteees absolutely nothing, doubly so.
For a large number of adults:
They’ll never have lower expenses and a greater tolerance for not having money than at ages 18-22.
They’ll never be in closer contact with such large numbers of people their age with the same level of freedom.
I get not spending insane money to go to college but 4 years at an in-state school with reasonable tuition can be a very fun time that you really only get the chance to do once.
I wouldn’t go into debt $100k to do it, but $30k-50k doesn’t seem like an outrageous number for how much fun it can be.
They’ll never have lower expenses and a greater tolerance for not having money than at ages 18-22.
They’ll never be in closer contact with such large numbers of people their age with the same level of freedom.
I get not spending insane money to go to college but 4 years at an in-state school with reasonable tuition can be a very fun time that you really only get the chance to do once.
I wouldn’t go into debt $100k to do it, but $30k-50k doesn’t seem like an outrageous number for how much fun it can be.
As someone who did just that (and to be fair, I was the beneficiary of an inheritance that paid my $40k off immediately after graduation) I can agree with you, but also it seems silly to have to pay all the tuition and do all the stupid graduation requirements when the main benefits are networking with cool fellow young people, and lack of responsibility. I learned so much more last year from YouTube videos than I did in 4 years of college 20 years ago.
I guess what I'm saying is, if they had a 'college' which only had dorms, cafes, interest clubs, and various paths of casual, part-time study which gave no grades and automatically conferred a 'participation certificate' after 4 years, and cost half as much, I'd tell my kids to go there.
I guess what I'm saying is, if they had a 'college' which only had dorms, cafes, interest clubs, and various paths of casual, part-time study which gave no grades and automatically conferred a 'participation certificate' after 4 years, and cost half as much, I'd tell my kids to go there.
> if they had a 'college' which only had dorms, cafes, interest clubs, and various paths of casual, part-time study which gave no grades and automatically conferred a 'participation certificate' after 4 years
I got an English degree from University of Florida and that is basically what you are describing lol.
I got an English degree from University of Florida and that is basically what you are describing lol.
Depends on what you go for. The arts degrees you are probaply right but the engineering degrees need serious study.
4 years of fun for $50k plus living expenses. You can have fun for 4 years for just the living expenses and save the 50k. The only reason college makes more sense is because your parents are covering the living expenses. Something they probably won't be willing to do if the premise is just having fun.
"College Is Still Worth It Even with Higher Out-of-Pocket Costs"
You could at least try to engage with what the article actually says.
You could at least try to engage with what the article actually says.
I read the article. My comment is a direct refutation of the premise of the article.
I think much 'higher education' is an inflated scam partially for being able to discriminate against black people, and they not as able to afford high education costs.
I still think apprentice work, but under multiple people with mastery, is the most effective. But only the trades see that as true.
I think much 'higher education' is an inflated scam partially for being able to discriminate against black people, and they not as able to afford high education costs.
I still think apprentice work, but under multiple people with mastery, is the most effective. But only the trades see that as true.
There is truth to what you say - but it's not absolute.
So very many students I knew when at University were surviving entirely off loans/debt, instead of having a job. That's one of the easiest ways for people to rack up 5-6 figures of "student" debt... even though a non-trivial amount was spent on Chipotle and Blaze Pizza... along with expensive apartments or dorms (all expenses the individual would incur regardless if they were a student or not).
Many people believe University (and therefore a degree) is an automatic door to a high paying job - yet fail to realize what your field of study is matters a lot. We almost shouldn't even offer student loans for anything outside of STEM, but even within STEM your job prospects are largely up to the individual.
University largely doesn't teach you how to do a job... it teaches you how to think. You spend a lot of time in your field of study thinking deeply about issues, ideas, past works, etc. None of which prepares you for your first day in the office.
University (and the college experience in general) is meaningful and powerful. I recommend it - but not with debt. Get a full-time job, and work your way through your degree program. It will take much longer to get your degree, but you will be a much more complete adult at the end, filled with equal parts life-experience and domain knowledge.
So very many students I knew when at University were surviving entirely off loans/debt, instead of having a job. That's one of the easiest ways for people to rack up 5-6 figures of "student" debt... even though a non-trivial amount was spent on Chipotle and Blaze Pizza... along with expensive apartments or dorms (all expenses the individual would incur regardless if they were a student or not).
Many people believe University (and therefore a degree) is an automatic door to a high paying job - yet fail to realize what your field of study is matters a lot. We almost shouldn't even offer student loans for anything outside of STEM, but even within STEM your job prospects are largely up to the individual.
University largely doesn't teach you how to do a job... it teaches you how to think. You spend a lot of time in your field of study thinking deeply about issues, ideas, past works, etc. None of which prepares you for your first day in the office.
University (and the college experience in general) is meaningful and powerful. I recommend it - but not with debt. Get a full-time job, and work your way through your degree program. It will take much longer to get your degree, but you will be a much more complete adult at the end, filled with equal parts life-experience and domain knowledge.
> it teaches you how to think
Is there evidence for this?
I'm pretty sure people already know how to think. And IIRC tests of critical thinking (not subject specific) to college seniors and freshmen there's not convincing evidence that college really does that much. https://opportunityamericaonline.org/wp-content/uploads/2017... - also 4 years of anything tends to make an 18-22 year old a bit older and wiser.
A meta argument - colleges are at least halfway competent at assessing critical thinking, and if they were good at improving critical thinking then you'd expect to hear from the unis that can prove they did a good job, and you'd get more than just a slogan. Playing League of Legends also has a bit of face validity to any claim that it improves teamwork, problem solving, decision making under pressure, etc.
Is there evidence for this?
I'm pretty sure people already know how to think. And IIRC tests of critical thinking (not subject specific) to college seniors and freshmen there's not convincing evidence that college really does that much. https://opportunityamericaonline.org/wp-content/uploads/2017... - also 4 years of anything tends to make an 18-22 year old a bit older and wiser.
A meta argument - colleges are at least halfway competent at assessing critical thinking, and if they were good at improving critical thinking then you'd expect to hear from the unis that can prove they did a good job, and you'd get more than just a slogan. Playing League of Legends also has a bit of face validity to any claim that it improves teamwork, problem solving, decision making under pressure, etc.
When I say "teach you to think", I don't just mean critical thinking. I mean the entire "mind" experience.
Being forced to take subjects you have no interest in, and to do well you must think about them deeply. This expands your mind, and teaches you how to approach things you find boring, have little interest in, and/or don't want to do. Someone is there to hold you accountable for your learning, knowledge and work - all things you must learn to rationalize and do on your own.
Many like to say "when am I ever going to use X?", failing to understand not all of the value is in that particular subject - instead it's the complete experience.
On reflection, I found some of my most mundane classes to be the most impactful on my life, such as Film Appreciation or Theory of Criminality. These challenged my beliefs and assumptions, expanded my thoughts, and forced me to communicate (vocally and in writing) why I held them. Instead of just "knowing" something, I was challenged to think about and understand why.
You will be a better human being, after surviving the experience. You will be more capable of adaptation, reasoning, critical thinking, personal discipline and more.
None of this are things you can't learn on your own, or experience somewhere else. But University is a really great way.
Being forced to take subjects you have no interest in, and to do well you must think about them deeply. This expands your mind, and teaches you how to approach things you find boring, have little interest in, and/or don't want to do. Someone is there to hold you accountable for your learning, knowledge and work - all things you must learn to rationalize and do on your own.
Many like to say "when am I ever going to use X?", failing to understand not all of the value is in that particular subject - instead it's the complete experience.
On reflection, I found some of my most mundane classes to be the most impactful on my life, such as Film Appreciation or Theory of Criminality. These challenged my beliefs and assumptions, expanded my thoughts, and forced me to communicate (vocally and in writing) why I held them. Instead of just "knowing" something, I was challenged to think about and understand why.
You will be a better human being, after surviving the experience. You will be more capable of adaptation, reasoning, critical thinking, personal discipline and more.
None of this are things you can't learn on your own, or experience somewhere else. But University is a really great way.
> Being forced to take subjects you have no interest in, and to do well you must think about them deeply.
It requires you to do the bare minimum memorization to pass the test. Deep thinking not included. Also you have 13 years experience f Doing this already by the time you start college.
It requires you to do the bare minimum memorization to pass the test. Deep thinking not included. Also you have 13 years experience f Doing this already by the time you start college.
[deleted]
There are no guarantees in anything. It's a moot point. As the article makes clear, you can still expect to earn more on average with a degree.
That is true, especily after https://en.m.wikipedia.org/wiki/Griggs_v._Duke_Power_Co. That forbid IQ testing in the workplace.
The next best, and completely legal requirement was a 'college degree'. What college? We don't care. What degree? Again, we dont care.
Its a bar that less black people pass than white people. So completely legal discrimination, but on its face is completely equal.
The next best, and completely legal requirement was a 'college degree'. What college? We don't care. What degree? Again, we dont care.
Its a bar that less black people pass than white people. So completely legal discrimination, but on its face is completely equal.
I think only about half of students take out loans, so that's only part of the consideration.
I make 160k/yr, and blew 30k on school that amounted to absolutely nothing. I taught myself systems - there aren't even any degrees that discuss systems architecture. Its not even a thing.
I was sold a lemon. At least vehicles have a lemon law. Education has nothing such, and worse yet, has protections against things like even bankruptcy.
Edit: For those of you who -1ed this, I would love any sort of citable proof that university has a demonstrable anything positive. As far as I've seen, I've had to teach myself all the monetizable skills. All I have from what Uni classes I took is a big bill and absolutely no positive things.
I was sold a lemon. At least vehicles have a lemon law. Education has nothing such, and worse yet, has protections against things like even bankruptcy.
Edit: For those of you who -1ed this, I would love any sort of citable proof that university has a demonstrable anything positive. As far as I've seen, I've had to teach myself all the monetizable skills. All I have from what Uni classes I took is a big bill and absolutely no positive things.
Your degree had an impact on your hireability and marketability. It signals passing a threshold of work and knowledge, your self-edification doesn't. You can of course build something, but so do college grads, whom you compete against.
You also admitted that your wage is such that paying off the tuition was trivial. That makes it seem like a good deal, not a bad one. Even if you're strictly criticizing knowledge-transfer, most people would disagree and find some value in the format.
You also admitted that your wage is such that paying off the tuition was trivial. That makes it seem like a good deal, not a bad one. Even if you're strictly criticizing knowledge-transfer, most people would disagree and find some value in the format.
there's something disturbing about learning just being reduced to an ROI calculation. Is there no non-monetary value in the knowledge and skills? If it doesn't make us money it's not worth it?
At the ridiculous cost of attendance at a traditional university a love for learning is not a good value proposition. Someone who loves learning would be better served doing self led study with occasional tutoring. Costs will be much lower and the education far more specialized. Of course I wouldn’t want a medical professional to diagnose my hypothetical cancer with a trade school education either. As with a great many things, YMMV.
100% this. Many non experimental topics can be self taught with the help of paid tutors -- I'm sure university tutors are happy to give you tutorials if you pay them cash.
Plus all colleges have very stringent prerequisites rules and tons of BS classes one has to take. Some colleges have independent studies, which are much better, but you still have to go through the prerequisites gate and other annoyances, plus it's still expensive.
Plus all colleges have very stringent prerequisites rules and tons of BS classes one has to take. Some colleges have independent studies, which are much better, but you still have to go through the prerequisites gate and other annoyances, plus it's still expensive.
Knowledge and skills have great value! Yes, we should all pursue them with enthusiasm, even for their own sake!
But I'd argue that colleges are purporting to sell 'knowledge and skills' -- at a markup somewhere between hilarious and absurd. Knowledge and skills are absolutely free for the taking now. Academia has zero claim to them.
There are more insightful lectures on YouTube in ANY subject area than you'll hear in 99% of college classrooms. Libraries full of books anyone can read on any subject. And for someone who wants those ideas organized into a course of study, you can just download a syllabus for a college class, even buy all the textbooks, and pay a couple thousand a year, compared to the $20,000+ the average college tries to charge. For a customized and up-to-date syllabus, ask an AI to update an old one with the latest concepts and discoveries.
So why should they charge us so much? The answer is that they are not actually selling knowledge or skills. They're just gatekeeping access to be elite, and they can't make it truly affordable because then it would lose even more of its original value. Even now, just "a college degree" barely even grants any elite status, only the Ivys and certain respected schools in niches (e.g. UCLA for film school) confer any status. For everyone else, it may get your foot in a door somewhere, serving basically just as a vague proof that you have enough perseverance to complete one annoying, long-term slog, but that door is not a door that guarantees you any prosperity anyway.
But I'd argue that colleges are purporting to sell 'knowledge and skills' -- at a markup somewhere between hilarious and absurd. Knowledge and skills are absolutely free for the taking now. Academia has zero claim to them.
There are more insightful lectures on YouTube in ANY subject area than you'll hear in 99% of college classrooms. Libraries full of books anyone can read on any subject. And for someone who wants those ideas organized into a course of study, you can just download a syllabus for a college class, even buy all the textbooks, and pay a couple thousand a year, compared to the $20,000+ the average college tries to charge. For a customized and up-to-date syllabus, ask an AI to update an old one with the latest concepts and discoveries.
So why should they charge us so much? The answer is that they are not actually selling knowledge or skills. They're just gatekeeping access to be elite, and they can't make it truly affordable because then it would lose even more of its original value. Even now, just "a college degree" barely even grants any elite status, only the Ivys and certain respected schools in niches (e.g. UCLA for film school) confer any status. For everyone else, it may get your foot in a door somewhere, serving basically just as a vague proof that you have enough perseverance to complete one annoying, long-term slog, but that door is not a door that guarantees you any prosperity anyway.
They charge us so much, because they are selling something, and the barrier of entry to the industry is high. Prices are naturally set to the level people can afford to pay, rather than being based on how much it costs to provide the service efficiently.
Some of the main benefits of institutionalized education are social. It's more acceptable to go to a college instead of spending a few years self-studying. And if you are not exceptionally motivated, the institutional pressure probably makes you study more than you would do on your own.
And some fields are easier to study on your own than others. One common pitfall of studying on your own is that you may learn the content without understanding it in the right context. Each field has its own ways of thinking, its own implicit assumptions, its own approaches to things, and so on. Theoretical frameworks, if you like big pretentious words. Those things are difficult to learn without people who are already familiar with the field. Software engineering is probably one of the easiest fields for self-study, as a lot of activity happens in public in open source projects. Computer science is already much harder.
Some of the main benefits of institutionalized education are social. It's more acceptable to go to a college instead of spending a few years self-studying. And if you are not exceptionally motivated, the institutional pressure probably makes you study more than you would do on your own.
And some fields are easier to study on your own than others. One common pitfall of studying on your own is that you may learn the content without understanding it in the right context. Each field has its own ways of thinking, its own implicit assumptions, its own approaches to things, and so on. Theoretical frameworks, if you like big pretentious words. Those things are difficult to learn without people who are already familiar with the field. Software engineering is probably one of the easiest fields for self-study, as a lot of activity happens in public in open source projects. Computer science is already much harder.
> Each field has its own ways of thinking, its own implicit assumptions, its own approaches to things, and so on. ... people who are already familiar with the field.
Agreed. Would you say that sitting in a lecture hall with 300 other people, receiving a boring lecture from a grad student, does a good job of imparting this deep understanding?
It seems to me that there are a few dozen people in any given field who have truly meaningful insights to impart. Maybe a tenth of those people are college professors, and some fraction of those bother to teach students, preferring to do research and publish papers to accrue additional clout in the Academia Game.
So most college students are actually taught by grad students or Lecturers/adjuncts with mediocre levels of "familiar with the field" knowledge. The ones who were lucky enough to be taught directly by the real experts probably get their money's worth. I don't think most do.
I'd rather that the few experts who truly do want to teach students, were hired with tax dollars to create content for study at free virtual universities, and do away with the facsimilies of 'expert instruction' being sold to most students today for $20k+ a year.
Agreed. Would you say that sitting in a lecture hall with 300 other people, receiving a boring lecture from a grad student, does a good job of imparting this deep understanding?
It seems to me that there are a few dozen people in any given field who have truly meaningful insights to impart. Maybe a tenth of those people are college professors, and some fraction of those bother to teach students, preferring to do research and publish papers to accrue additional clout in the Academia Game.
So most college students are actually taught by grad students or Lecturers/adjuncts with mediocre levels of "familiar with the field" knowledge. The ones who were lucky enough to be taught directly by the real experts probably get their money's worth. I don't think most do.
I'd rather that the few experts who truly do want to teach students, were hired with tax dollars to create content for study at free virtual universities, and do away with the facsimilies of 'expert instruction' being sold to most students today for $20k+ a year.
Universities are more about learning than teaching. The heavy focus on teaching, and the expectation that every class is taught, is large part of the reason why American higher education is so expensive.
During my undergrad, in a European public university poorly funded by American standards, seminar classes were the key for actually understanding the field. Students would read papers and other primary sources, give presentations and write papers based on them, and discuss what the others had done. The person in charge would usually be either an active researcher or a senior professor who had been active in the past.
During my undergrad, in a European public university poorly funded by American standards, seminar classes were the key for actually understanding the field. Students would read papers and other primary sources, give presentations and write papers based on them, and discuss what the others had done. The person in charge would usually be either an active researcher or a senior professor who had been active in the past.
I agree with many of your points. However, one thing I think you might be missing is that many people, like myself, benefit greatly from structure.
I could have learned many of the subjects on my own.
Would I have? That is a better question.
I seriously doubt I would have.
Academics aside, I had some good, bad, and ugly times while in college. It has been about a decade out and think that period of my life nearly every day. I learned a lot of lessons that videos cannot convey and had experiences that cannot capture. I met the love of my life there -- in a computer ethics class.
I could have learned many of the subjects on my own.
Would I have? That is a better question.
I seriously doubt I would have.
Academics aside, I had some good, bad, and ugly times while in college. It has been about a decade out and think that period of my life nearly every day. I learned a lot of lessons that videos cannot convey and had experiences that cannot capture. I met the love of my life there -- in a computer ethics class.
>> Is there no non-monetary value in the knowledge and skills? If it doesn't make us money it's not worth it?
Not saying college isnt worth it, but knowledge and skills can be much more easily obtained via MOOCs, digital learning platforms, reading, etc. I know not everyone has the focus to do so, but that is usually because they do not look at the sheer cost of the alternative. A good way to frame the decision is -- "if you cannot learn some of this via MOOCs/Udemy/Udacity/Coursera, are you willing to pay $80k for someone to help you focus on doing it?"
Separate from this is experience, relationships, teamworks, practicals/labs, etc which I think college is much better at than MOOCs/Udemy/Udacity/Coursera.
I honestly wish I could have done a year or two of MOOCs/Udemy/Udacity/Coursera inbetween college so I could focus even more on experience, relationships, teamworks, practicals/labs when actually in college.
Not saying college isnt worth it, but knowledge and skills can be much more easily obtained via MOOCs, digital learning platforms, reading, etc. I know not everyone has the focus to do so, but that is usually because they do not look at the sheer cost of the alternative. A good way to frame the decision is -- "if you cannot learn some of this via MOOCs/Udemy/Udacity/Coursera, are you willing to pay $80k for someone to help you focus on doing it?"
Separate from this is experience, relationships, teamworks, practicals/labs, etc which I think college is much better at than MOOCs/Udemy/Udacity/Coursera.
I honestly wish I could have done a year or two of MOOCs/Udemy/Udacity/Coursera inbetween college so I could focus even more on experience, relationships, teamworks, practicals/labs when actually in college.
Are you disciplined and internally motivated enough to sit down and go through all those various courses? If so, I envy you with every last fiber of my being.
> "if you cannot learn some of this via MOOCs/Udemy/Udacity/Coursera, are you willing to pay $80k for someone to help you focus on doing it?"
Let me tell you, when you know that the only way to pay back that 80k is with your hard earned money or your life, then the motivation is a lot easier to muster. My loans were not even half that amount, and that was still enough to put the fear of God in me.
> "if you cannot learn some of this via MOOCs/Udemy/Udacity/Coursera, are you willing to pay $80k for someone to help you focus on doing it?"
Let me tell you, when you know that the only way to pay back that 80k is with your hard earned money or your life, then the motivation is a lot easier to muster. My loans were not even half that amount, and that was still enough to put the fear of God in me.
The typical student that wants to learn and gain skills self-teaches online.
The reason why I am getting a degree in computer engineering is because I need it to get a job, because a degree is supposed to filter out people who don't understand how to write code at any level. I'm essentially paying for someone to grade my tests and assignments. Honestly, I think most of my courses are too easy and I'm not getting good value on the filtering side.
Most of the lecture materials I pay for are plagiarized from open courses. Sometimes I find the original course. Typically my professor refactors stuff to make it less clear or add false information.
If I was at a top-tier university, I might be getting knowledge I couldn't get elsewhere. But at my school the professors pretend to teach and the students pretend to learn.
The reason why I am getting a degree in computer engineering is because I need it to get a job, because a degree is supposed to filter out people who don't understand how to write code at any level. I'm essentially paying for someone to grade my tests and assignments. Honestly, I think most of my courses are too easy and I'm not getting good value on the filtering side.
Most of the lecture materials I pay for are plagiarized from open courses. Sometimes I find the original course. Typically my professor refactors stuff to make it less clear or add false information.
If I was at a top-tier university, I might be getting knowledge I couldn't get elsewhere. But at my school the professors pretend to teach and the students pretend to learn.
The learning materials are all online, but realistically, very few students are going to work full-time 9 months per year for 4 years doing assignments by themselves, without weekly deadlines and friends to cheer them on. If you're going to put in all that time, you might as well get the degree.
And as the article points out, the time itself is what dominates the total cost--not tuition.
And as the article points out, the time itself is what dominates the total cost--not tuition.
> I'm essentially paying for someone to grade my tests and assignments
ever considered something like WGU if that's the case? Cheap, can be finished as fast as you want, and would likely get you past HR screening at the rate of a mid-tier uni
ever considered something like WGU if that's the case? Cheap, can be finished as fast as you want, and would likely get you past HR screening at the rate of a mid-tier uni
With open courseware and other tools, dedicated individuals have even less motivation to go through a college just for knowledge. And you don't have to take any class you are not interested in. Of course this doesn't apply to topics that require a lot of equipments.
College is largely for certification and connections IMO. Both are basically just financial concerns.
College is largely for certification and connections IMO. Both are basically just financial concerns.
This. I'm old, but to me even ignoring the learning a huge part was getting to start over with a new friend group with way healthier dynamics than high school. Changed my understanding of friendship.
Is there no non-monetary value in the other things that someone might be doing between the ages of 18 and 22, which may also involve learning?
Are they giving liberal arts educations away for free? No?
> If it doesn't make us money it's not worth it?
By definition, that makes it a luxury.
> If it doesn't make us money it's not worth it?
By definition, that makes it a luxury.
This is a useless statement unless you provide an alternative metric to decide how much education is worth having.
Keep in mind some people can't afford to make bad financial decisions.
Aside: For everyone who thinks they can recognize AI images. Did you notice this one jump out at you?
Feels like we're one year away from totally undetectable AI images, and just after that for video.
Feels like we're one year away from totally undetectable AI images, and just after that for video.
It's easy to tell the article image is AI, easiest clue is guy's ear, the wire goes nowhere. But this is a placeholder image that has no purpose and it's there just because there has to be an image. No one pays attention.
How about the bone/wire in her hand?
Nah, those are just the newest version of the LobePods
The only thing that jumped out at me - what thought process leads to thinking this image improves this article / page?
I have argued with web editors about this. Most articles doesn't need an image. Period. The only need for the image is where the articles are listed and articles with interesting images are more likely to be clicked on. Finding good relevant pictures is hard, because they usually add nothing.
> Finding good relevant pictures is hard, because they usually add nothing.
There may be a role here for AI if it can create relevant pictures, but AI was used to generate generic stock photography in this case.
There may be a role here for AI if it can create relevant pictures, but AI was used to generate generic stock photography in this case.
i didnt even look at the image
There's some hacks around College debt such as going to Berea College, federal work colleges, or Deep Springs College. Also Community College to a local college (ensure that your credits will transfer 100%) is a cheaper option. I've been fortunate enough to get jobs without a degree.
I've also attended community college, a prestigious college (Tulane) and Berea College. Their courses are essentially the same, but different costs. People are a little smarter, so the standard for homework is a bit higher at Tulane. Honestly it's not worth to get debt for a brand name that most employers don't care about these days.
I've also attended community college, a prestigious college (Tulane) and Berea College. Their courses are essentially the same, but different costs. People are a little smarter, so the standard for homework is a bit higher at Tulane. Honestly it's not worth to get debt for a brand name that most employers don't care about these days.
I don't think it's a hack at all. It's how higher education should work. My dental hygienist was sending her daughter to college that way, and was just delighted with the deal that they were getting.
While our present system is what it is, and educates a lot of people, the same can be said for our health care system. But both are these opaque public-private enterprises that cost twice or more as in other civilized countries, for no reason that anybody can discern.
I've long believed that our best bet towards reforming higher education is to support and strengthen the public institutions that are doing a lot of good for a lot of people.
While our present system is what it is, and educates a lot of people, the same can be said for our health care system. But both are these opaque public-private enterprises that cost twice or more as in other civilized countries, for no reason that anybody can discern.
I've long believed that our best bet towards reforming higher education is to support and strengthen the public institutions that are doing a lot of good for a lot of people.
I sincerely hope that we start sending a more considered and nuanced message to young people now about "college."
In my father's (Boomer) generation, you could incredibly easily see the net effect that college vs. no college had on career potential and thus earnings, and as a result I was coached to aim exclusively for college.
If I'm being honest I gained two main things from those four years:
1. I personally enjoyed a few fascinating or culturally uplifting classes, most of which were outside my major
2. By luck, I happened to meet someone in a class (which was an overall graduation requirement for the College of Business), who connected me to my first tech-related job.
Thankfully my school was cheap and I only graduated with about $40k in debt. But if I'd spent those 4 years living at home and teaching myself to code, I'd have been far ahead in my skills. To the extent anyone refused to hire a "non-college educated" software engineer, it would have been their loss, because it contributed nothing to my skills.
I will not be suggesting to my kids that they target "college," unless they have a very specific career goal and are confident on the job prospects and the median earnings being sufficient to pay back the loans and still be a net positive. There are just too many of the 'requires college' careers now that used to be somewhat viable and now are a dead-end joke, such as teaching, journalism, etc. Including software development, probably, for Gen Alpha, since nobody wants to hire juniors anymore, for rational reasons.
In my father's (Boomer) generation, you could incredibly easily see the net effect that college vs. no college had on career potential and thus earnings, and as a result I was coached to aim exclusively for college.
If I'm being honest I gained two main things from those four years:
1. I personally enjoyed a few fascinating or culturally uplifting classes, most of which were outside my major
2. By luck, I happened to meet someone in a class (which was an overall graduation requirement for the College of Business), who connected me to my first tech-related job.
Thankfully my school was cheap and I only graduated with about $40k in debt. But if I'd spent those 4 years living at home and teaching myself to code, I'd have been far ahead in my skills. To the extent anyone refused to hire a "non-college educated" software engineer, it would have been their loss, because it contributed nothing to my skills.
I will not be suggesting to my kids that they target "college," unless they have a very specific career goal and are confident on the job prospects and the median earnings being sufficient to pay back the loans and still be a net positive. There are just too many of the 'requires college' careers now that used to be somewhat viable and now are a dead-end joke, such as teaching, journalism, etc. Including software development, probably, for Gen Alpha, since nobody wants to hire juniors anymore, for rational reasons.
>> Including software development, probably, for Gen Alpha, since nobody wants to hire juniors anymore, for rational reasons.
This point is the best so far -- from my standpoint in technology, the market for entry-level has almost completely disappeared. When speaking with my kids, I dont know how I could propose over-leveraging for college any longer in any field where there isnt forced scarcity or licenses or some other protection mechanism for entry-level workers looking to go up the ladder.
This point is the best so far -- from my standpoint in technology, the market for entry-level has almost completely disappeared. When speaking with my kids, I dont know how I could propose over-leveraging for college any longer in any field where there isnt forced scarcity or licenses or some other protection mechanism for entry-level workers looking to go up the ladder.
As someone who now spends my time conducting over a dozen interviews a week for senior software engineers, it absolutely breaks my heart that I can't tell a smart, tech-loving 18-year-old to either learn to code or get a CS degree and go into software.
I don't know which outcome I'd hate more:
• It turns out that AI has hit a ceiling and in 20 years when I retire there will be no one left to do the complex work that senior engineers do today because we shut out a whole generation of engineers, or
• AI continues to advance and no humans are even involved in software in 20 years
I don't know which outcome I'd hate more:
• It turns out that AI has hit a ceiling and in 20 years when I retire there will be no one left to do the complex work that senior engineers do today because we shut out a whole generation of engineers, or
• AI continues to advance and no humans are even involved in software in 20 years
What if I don't care about the economic benefits? What if I just really want to learn something?
Depends on what you need. For general knowledge or broad exploration, there are plenty of general education courses you can take at community colleges. However for specific knowledge that requires lab space or equipment you can't get at home, you generally need to enroll in a degree program nowadays.
Thanks. That was a very kind answer.
I must say my intent was only to show that college can offer things that the internet can't.
While I don't have a degree myself (I am too old by now), I do see value in younger people getting one.
I must say my intent was only to show that college can offer things that the internet can't.
While I don't have a degree myself (I am too old by now), I do see value in younger people getting one.
Many colleges have night school for working adults who want to learn something.
That's free on the internet
While I understand the need to have this type of conversation in our current society and economy, I think it is sad that we need to discuss the merits of going to college on a economical basis.
Ideally, I think the goal of college is to further education in a specific field. Reducing it as a opportunity for return can be counter-productive with the goals of it on the long term.
Of course, this is ideally speaking, the real world doesn't function like that and there is a need for a return both on a individual and societal level.
Don't you have consider that many jobs require a college degree?
You can certainly argue that this is a dumb requirement - but regardless of "ROI", if you want job X, you need to get a degree (for many X).
It is very obvious that everyone doesn't choose their career path to maximize income.
Of course, maybe that is changing rapidly. Tech seems to be ahead on this since there are more direct ways to prove your ability.
You can certainly argue that this is a dumb requirement - but regardless of "ROI", if you want job X, you need to get a degree (for many X).
It is very obvious that everyone doesn't choose their career path to maximize income.
Of course, maybe that is changing rapidly. Tech seems to be ahead on this since there are more direct ways to prove your ability.
Sure but there are jobs that don't as well. the low end of jobs that require a degree pay far less than the high end that don't. (Ignoring own your own business which can pay very well without a degree)
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Social scene in college is pretty hard to beat
I'd also like to see return by college ranking, selectivity, and ROI for drop-outs.
tldr: "College Is Still Worth It Even with Higher Out-of-Pocket Costs", however the bottom quarter of college students see little premium over a high school degree. Until 1995 the median high school only educated person earned more than the bottom 25% of college graduates.
One of my Mom's friends told me back then companies were desperate to hire anyone with a college degree.
Also, gives a breakdown per field. It really tells you something when a fine arts degree has a better return then education. (Edit: missed this: "Returns are especially low for education majors, though it should be noted that annual wages for this group typically reflect teacher salaries for a nine-month school year.")
One of my Mom's friends told me back then companies were desperate to hire anyone with a college degree.
Also, gives a breakdown per field. It really tells you something when a fine arts degree has a better return then education. (Edit: missed this: "Returns are especially low for education majors, though it should be noted that annual wages for this group typically reflect teacher salaries for a nine-month school year.")
The real story is 3 links deep, in the PDF of the original analysis and methodology from 2014 - the same is applied to the 2023 data, so it's still relevant source material for understanding their numbers.
https://www.newyorkfed.org/medialibrary/media/research/curre...
So, as a layman who does not work for the NY fed, I thought it was a good analysis ;) that is, right up until the final number crunching where there appears to be some mathematical sleight of hand.
Essentially, their ROI is a comparison of wages with and without a degree, but the opportunity cost only counts earned wages and conspicuously omits investing those wages as part of the calculation. The sleight of hand is they make a point to compare ROI of education to the stock market _after the fact_ rather than baking it into the initial formula. Equally problematic is the complete omission of student loans which has the same effect.
To be charitable, hand-waving rates makes sense in the world of ROI - 12% with a late start will eventually overtake 7% with a head start, and is therefore numerically superior. But the paper repeatedly emphasizes its own caveat, that their analysis is "all based on historical trends, which are no guarantee of future patterns." It's precisely because of current trends - the rising student debt, soaring tuition, and the growing chasm between graduation and securing your first job - that this "late start" really needs further attention.
Where is it headed, and what's the tipping point? Maybe it's still valuable if you're graduating today, but what about 4 years from now?
Back to the methodology - the scenario explores averages, but should be one of ideal financial decision making, so someone with only a high school degree has an automatic 4 year head start earning AND investing money, but those that pursue a degree are set back by debt AND negative interest rates. The question is: how big is the gap and how long does it take to catch up? This is a function of tuition, interest, wages, job opportunities, and cost of living. Again, there's no arguing with ROI, but the living reality that this data reflects is a delayed start in life at best, and a marginally positive ROI on education at worst.
The paper mentions another significant caveat challenging its own fundamental assumption: education is an investment and not a filter. I'm not aware of any analysis comparing outcomes based on socioeconomic background, but we can assume the high academic achievers would still do well financially if they didn't go to college. But there a very real and growing cohort of individuals experiencing negative ROI, where debt exceed earnings. The best data I could find on this is from 2016, we're overdue for an update.
https://www.brookings.edu/articles/the-relationship-between-...
Yet there are further confounding factors - not at all mentioned is how the modern job market is dependent on educational attainment. Employers have entirely deferred training to colleges, and the vast majority of high earning jobs today (even beyond white collar roles - ex. running a daycare) have a hard requirement of higher education. With the exception of the recent, short-lived, learn2code/bootcamp trend, there is very little latitude for non-degree holders.
In summary, there's a worrying shift in the function of modern education. It all started as a common, shared dream to give young people a better chance in life. Gradually it became an economic investment to secure better employment, then it turned into training for jobs that no longer provide such resources. Today its used to filter out those found unqualified, and at worst is a form of gatekeeping, excluding those considered unworthy. Education has become a monolith and a monopoly that controls the "all day access pass" to the labor market. ROI is a diversion, the fact is its the only game in town. "Go to college and do well, or perish."
I would like to see the fine folks at the NY Fed follow up and try to compute these extra scenarios. Don't average the outcome like you're making a sales pitch. Give us a multi-dimensional breakdown like an economist - or else us unwashed, unqualified, uneducated folks will start doing our own sloppy math and running amok, giving people wrong ideas and ultimately mislead them into bad financial decisions, that other predatory institutions run by educated folks can profit off of. (What's the ROI on that outcome?)
https://www.newyorkfed.org/medialibrary/media/research/curre...
So, as a layman who does not work for the NY fed, I thought it was a good analysis ;) that is, right up until the final number crunching where there appears to be some mathematical sleight of hand.
Essentially, their ROI is a comparison of wages with and without a degree, but the opportunity cost only counts earned wages and conspicuously omits investing those wages as part of the calculation. The sleight of hand is they make a point to compare ROI of education to the stock market _after the fact_ rather than baking it into the initial formula. Equally problematic is the complete omission of student loans which has the same effect.
To be charitable, hand-waving rates makes sense in the world of ROI - 12% with a late start will eventually overtake 7% with a head start, and is therefore numerically superior. But the paper repeatedly emphasizes its own caveat, that their analysis is "all based on historical trends, which are no guarantee of future patterns." It's precisely because of current trends - the rising student debt, soaring tuition, and the growing chasm between graduation and securing your first job - that this "late start" really needs further attention.
Where is it headed, and what's the tipping point? Maybe it's still valuable if you're graduating today, but what about 4 years from now?
Back to the methodology - the scenario explores averages, but should be one of ideal financial decision making, so someone with only a high school degree has an automatic 4 year head start earning AND investing money, but those that pursue a degree are set back by debt AND negative interest rates. The question is: how big is the gap and how long does it take to catch up? This is a function of tuition, interest, wages, job opportunities, and cost of living. Again, there's no arguing with ROI, but the living reality that this data reflects is a delayed start in life at best, and a marginally positive ROI on education at worst.
The paper mentions another significant caveat challenging its own fundamental assumption: education is an investment and not a filter. I'm not aware of any analysis comparing outcomes based on socioeconomic background, but we can assume the high academic achievers would still do well financially if they didn't go to college. But there a very real and growing cohort of individuals experiencing negative ROI, where debt exceed earnings. The best data I could find on this is from 2016, we're overdue for an update.
https://www.brookings.edu/articles/the-relationship-between-...
Yet there are further confounding factors - not at all mentioned is how the modern job market is dependent on educational attainment. Employers have entirely deferred training to colleges, and the vast majority of high earning jobs today (even beyond white collar roles - ex. running a daycare) have a hard requirement of higher education. With the exception of the recent, short-lived, learn2code/bootcamp trend, there is very little latitude for non-degree holders.
In summary, there's a worrying shift in the function of modern education. It all started as a common, shared dream to give young people a better chance in life. Gradually it became an economic investment to secure better employment, then it turned into training for jobs that no longer provide such resources. Today its used to filter out those found unqualified, and at worst is a form of gatekeeping, excluding those considered unworthy. Education has become a monolith and a monopoly that controls the "all day access pass" to the labor market. ROI is a diversion, the fact is its the only game in town. "Go to college and do well, or perish."
I would like to see the fine folks at the NY Fed follow up and try to compute these extra scenarios. Don't average the outcome like you're making a sales pitch. Give us a multi-dimensional breakdown like an economist - or else us unwashed, unqualified, uneducated folks will start doing our own sloppy math and running amok, giving people wrong ideas and ultimately mislead them into bad financial decisions, that other predatory institutions run by educated folks can profit off of. (What's the ROI on that outcome?)
I lived with my parents and went to the local college because I didn’t have big ambitions.
The course gave everyone work placement with most people keeping the job after the course, starting at €28,000 - €35,000 salary on average.
My following job 4 years later paid €70,000 and then 2 years later €80,000.
At age 28 I am €35,000 above the median Salary of the country which is around €44,000.
The ROI has been massive on that €12,000 spent on college.
edit: I additionally have many friends who came from family’s where their parents / siblings were not working and sitting on welfare. through free college via grants, these friends became the first in their families to get degrees and subsequently are earning well over €60,000+ on average. I would also like to highlight that some of these people even only got a very low passing grade and weren’t prodigies by any means of the word.