Wednesday, September 7, 2011

The education bubble

Sorry, I don't know how I missed this.

I like to think I keep informed on current developments, up-to-date on the trends, au courant as some would say, but I'm just now catching up to the notion of an education bubble.

No, this isn't about a sophomore prank involving detergent. It's about belief in the merits of higher education being pushed to unreasonable extremes, and the likelihood that it will all come crashing down like the dot-com boom and the housing bubble.

The reasoning goes like this --- easily available student loans fuel an increase in tuition prices and produce an oversupply of graduates for a shrinking job market. Graduates' inability to find high-paid jobs to support repayment of the loans puts them behind the 8-ball financially and motivationally, and threatens the stability of the student loans industry. No doubt, the situation is self-correcting, but the cost may be a generation of people who never get their careers on track.

Those of my generation will remember being pushed to "stay in school" with an implied promise that a university education would guarantee "a job for life." That was good advice from a generation of parents who had lived through the Great Depression and knew something about the value of a steady job.

Two more generations have been urged to do the same, and the value of a degree has been hitherto unquestioned. Student loans, deferred pleasures, second mortgages --- such sacrifices were made, without question, by parent and child in the conviction that the investment would be returned many times over in job security, career fulfillment, and earnings. And, it was true!

Not so, now, apparently, some think.

Google "education bubble" and you will find 444,000 results, so there is a lot of chatter about this.

A university education no longer guarantees an affluent, secure, future. Hannah Seligson, in the New York Times, writes, "More college graduates are working in second jobs that don't require college degrees." These are low-paying, service sector jobs, and it eventually dawns for many that their dream career is not going to materialize.

Doug French, in the Christian Science Monitor, points out that two massive employers of university grads, government and the financial sector, are in the early stages of a huge downsizing. To this we might add the private sector trend to offshoring professional jobs --- software engineers, project managers, and the like.

These developments mean large-scale shrinkage of the number of opportunities over the next decade.

In a TechCrunch article, visionary entrepreneur Peter Thiel (co-founder of PayPal) challenges the widespread belief among graduates that the high cost and hard work involved in getting there means they are entitled to success. He thinks that dropping out of school and starting a company instead might be a better alternative for some. Thiel correctly predicted both the dot-com and housing blow-ups, so his opinions carry weight.

Lost in all of this is the notion that the university experience has value that can not be measured in dollars, having more to do with creating well-rounded people who lead enriched lives due to their exposure to the world of ideas, and so on.

Hard to focus on that while flipping burgers or making telemarketing calls, though.

1 comment:

  1. Sometimes I wonder how the people who work at Ontario's Teachers Colleges can sleep at night.

    It is so difficult to see so many of my former student teachers working in restaurants.
    Especially because they are the best of the best.