Is More Education the Answer?

What do most unemployed people, who can afford to, do during a recession, other than constantly looking for work and submitting applications? They go back to school. Universities throughout the country are facing record enrollment rates this year, and administrators everywhere are rubbing their hands together, watching gleefully as money moves out of the pockets of students and their parents and fills their universities' coffers. In many respects, the recession has offered a boost to large state universities.

Professors, of course, are less enthusiastic; they're seeing enrollment caps go way up, students spilling out into the hallways due to a lack of seats, and email inboxes full of requests from desperate students begging to add their class. (They swear they won't mind sitting on the floor.) Faculty workloads are increasing big time as a result, as are costs of living, while academic salaries remain frozen and hiring lines are cancelled. It's certainly not a win-win situation for everyone. I doubt you find many professors thrilled about the prospect of yet more students, many of whom barely have a grasp of the English language despite being native speakers, signing up for their large first-year lecture courses. (Oh, yay, now we have to teach 125 bored and apathetic students about medieval Europe instead of 75? Joy!)

But the rhetoric in the popular media suggests that going back to school, or furthering one's already extensive education with yet another B.A. or M.A. or even a Ph.D, is, as always, the best way to weather a recession. Is more education necessarily the answer? For those of us with advanced degrees but lacking in real-world experience, the idea of returning to school might seem absurd. What's the point? Employers want to hire people with experience, not an extensive knowledge of Chaucer.

But what about for the average 20 something? Is it worth it for them? What do you think? Would you advise someone to go back, or stay in, school until the recession is "over"? Have you considered returning to school despite the costs and time required?

Nice buildings sure make you feel like there's a point to it all!

Here is what the New York Times editorial team has to say about it:

Editorial: New York Times

Published: December 13, 2010

College, Jobs and Inequality

"Searching for solace in bleak unemployment numbers, policy makers and commentators often cite the relatively low joblessness among college graduates, which is currently 5.1 percent compared with 10 percent for high school graduates and an overall jobless rate of 9.8 percent. Ben Bernanke, the chairman of the Federal Reserve, cited the data recently on “60 Minutes” to make the point that “educational differences” are a root cause of income inequality.

A college education is better than no college education and correlates with higher pay. But as a cure for unemployment or as a way to narrow the chasm between the rich and everyone else, “more college” is a too-easy answer. Over the past year, for example, the unemployment rate for college grads under age 25 has averaged 9.2 percent, up from 8.8 percent a year earlier and 5.8 percent in the first year of the recession that began in December 2007. That means recent grads have about the same level of unemployment as the general population. It also suggests that many employed recent grads may be doing work that doesn’t require a college degree.

Even more disturbing, there is no guarantee that unemployed or underemployed college grads will move into much better jobs as conditions improve. Early bouts of joblessness, or starting in a lower-level job with lower pay, can mean lower levels of career attainment and earnings over a lifetime.Graduates who have been out of work or underemployed in the downturn may also find themselves at a competitive disadvantage with freshly minted college graduates as the economy improves.

When it comes to income inequality, college-educated workers make more than noncollege-educated ones. But higher pay for college grads cannot explain the profound inequality in the United States. The latest installment of the groundbreaking work on income inequality by the economists Thomas Piketty and Emmanuel Saez shows that the richest 1 percent of American households — those making more than $370,000 a year — received 21 percent of total income in 2008. That was slightly below the highs of the bubble years but still among the highest percentages since the Roaring Twenties.

The top 10 percent — those making more than $110,000 — received 48 percent of total income, leaving 52 percent for the bottom 90 percent. Where are college-educated workers? Their median pay has basically stagnated for the past 10 years, at roughly $72,000 a year for men and $52,000 a year for women.

A big reason for the huge gains at the top is the outsize pay of executives, bankers and traders. Lower on the income ladder, workers have not fared well, in part because health care has consumed an ever-larger share of compensation and bargaining power has diminished with the decline in labor unions.

College is still the path to higher-paying professions. But without a concerted effort to develop new industries, the weakened economy will be hard pressed to create enough better-paid positions to absorb all graduates.

And to combat inequality, the drive for more college and more jobs must coincide with efforts to preserve and improve the policies, programs and institutions that have fostered shared prosperity and broad opportunity — Social Security, Medicare, public schools, progressive taxation, unions, affirmative action, regulation of financial markets and enforcement of labor laws.

College is not a cure-all, but it will certainly take the best and brightest minds to confront those challenges."

*Any thoughts or comments?