Board of Scholars

The Higher Education Bubble?

By March 1, 2015 March 17th, 2020 No Comments

Parents see higher education as an investment in the future of their children.  There is a lot of evidence for this view.  Unemployment rates for those with a high school degree are much higher than those with a college degree (12.2 unemployment for high school only; 3.8 for college graduates), while earnings for college graduates outstrip the earnings of those who have only completed high school (high school-only graduates earn about 62% of the income of those who finished college).  The gap is widening with time as well: The number was 81% in 1965.*

What is going on here, as a recent Pew Research Center survey shows, is a rising cost of NOT going to college.  The college diploma is more valuable in relative terms than in absolute terms.  Economic opportunities, income and employment levels of those with only high school diplomas, have decreased in real terms in the past twenty-five years. Going to college is like standing up at a football game: when everyone else stands up, you have to stand up if you want to see.  Not going to college is like sitting while those around you are standing and blocking your view.  Those standing are not necessarily better off because they are standing, but they are able to see.

Students in 1961 averaged 25 hours per week of study time; in 2003 it was 13.  In 1961 more than two-thirds of students studied more than 20 hours a week; in 2003 only 20% did, while more than one-third of students spent less than 5 hours a week studying. Half of students in the late 2000s had never been required to do 20 pages of writing in a class, and nearly that many had not done more than 40 pages of reading per week in a class.  These statistics coincide with an actual decrease in the amount of learning that goes on in college.  36% of all college graduates show no improvements in writing, thinking or reading skills over the course of their entire college careers.  All of this coincides with great increases in the number of As and Bs earned on college campuses.

More highly selective colleges do generally have classes with more writing and reading.  Take it from a university professor at a state school: requiring students to read and write at these levels decreases their grades significantly, though I have faith that it increases their learning.  Students do not want to do this much work, and professors, generally, do not want to grade it or assign it.  Students can find an easy path through the requirements of all modern universities.

Increasing costs combined with increasing irrelevance of the education suggests to many that we are living through a higher education bubble.  A higher education bubble is emerging because colleges depend on enrollments to sustain their operations. The numbers of students going to college is decreasing (a decrease of almost a million students in the past two years).  This means that universities must increase prices in order to meet budgets.  (The federal government abets these increases in price through loans.)  Universities are raising prices at a time when the value of their product is coming under increasing scrutiny and when alternatives to brick and mortar universities are emerging.  Two-year schools, vocational training, on-line education, apprenticeships and perhaps other ways of delivering the credentials at a lower cost are arising and will continue to arise.  Such educational options may indeed have more immediate relevance to the career aspirations of many students.  This will lead to the bubble bursting for many universities.

The invaluable liberal education based on Great Books that many of us received on the university level is mostly a thing of the past: one must strive to get that at the K-12 level nowadays, since there are so few places that offer it at the university level.  Aside from liberal education, there is very little justification for a four-year, career-oriented degree from the current educational establishment (parents should also recognize what is called a liberal education is often not a liberal education).

Parents should be open to such alternatives to a four-year college experience for their children.  Parents should also recognize their investment is not just in preparing financially to pay for college.  They must continue to oversee that investment when their students are on campus.  This oversight consists of making sure that their children are getting better and challenging themselves intellectually.  It includes discussing their decisions of majors and career aspirations when they are on campus so the financial investment leads to gainful employment.

The modern economy is more about what you know than where you went to school.  Investing in higher education must, more and more, mean making sure children are prepared for this what-you-know reality.

*All data and statistics in this article are from Statistically Adrift: Limited Learning on College Campuses by Richard Arum and Josipa Roksa, 2011.

The views expressed here are those solely of the author and do not represent Boise State University or R|W Investment Management.

Dr. Scott YenorDr. Scott Yenor
Professor of Political Science
Boise State University

Scott Yenor is Professor of Political Science at Boise State University, where he teaches courses in political philosophy, American political thought, and constitutional law.  He is also Director of the American Founding Initiative, which aims to bring ideas of limited government and classical liberty to today’s university.  His publications include Family Politics: The Idea of Marriage in Modern Political Thought (Baylor, 2011), which concerns the way in which the ideas of contract and human autonomy have eclipsed the idea of marital unity in modern political thought. He is currently working on three books—one applies the idea of marital unity to today’s family policy; another concerns American Reconstruction; and the last is about the political thought of David Hume.   He lives in Meridian Idaho with his wife Amy and five children—Jackson, Travis, Sarah, Paul, and Biscuit (Mark!).  He enjoys basketball and reading (especially Russian novels and he has pledged to read only Russian novels until January 2017).