Is College Worth It?
FOCUS
May 5, 2015
Larry Goldstein, President
Campus Strategies, LLC
May 5, 2015
© Arizona State University
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These slides are from a presentation by President
Michael Crow, Arizona State University.
They are used here with permission granted by
Senior Vice President Richard Stanley, Arizona
State University.
May 5, 2015
© Arizona State University
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“Wisdom and knowledge, as well as virtue,
diffused generally among the body of the people
being necessary for their preservation of their
rights and liberties; and as these depend on
spreading of opportunities and advantages of
education in various parts of the country, and
among the different orders of the people…”
Massachusetts Constitution 1780
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“…it shall be the duty of the legislators and
magistrates in all future periods of this
commonwealth to cherish the interests of the
literature and the sciences, and all seminaries of
them…”
Massachusetts Constitution 1780
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“…especially at the university at Cambridge…”
Massachusetts Constitution 1780
CH. 5, SEC. 2
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Varied Perspectives
“Maybe it’s time to ask a question that seems almost sacrilegious: is all this investment in
college education really worth it? The answer, I fear, is that it's not. For an increasing
number of kids, the extra time and money spent pursuing a college diploma will leave
them worse off than they were before they set foot on campus.” – Megan McArdle,
Bloomberg View
“If you question the economic value of college, the defenders’ default answer is that it’s
priceless. Before long, spending four years in a lecture hall with a hangover will be
revealed as an antiquated debt-fueled luxury good.” – Peter Thiel, PayPal
“Knowledge is a form of capital that is always unevenly distributed, and people who have
more knowledge, or greater access to knowledge, enjoy advantages over people who
have less.” – Louis Menand, Harvard University
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The American Dream
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Educational attainment is key to
social mobility.
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Employment Polarization
1975 - 2010
Non-routine Cognitive
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Non-routine Manual
© Arizona State University
Routine
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The Trend is the Cycle: Job Polarization and Jobless Recoveries, 2012
Value to the Individual
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The internal rate of return for a
degree substantially exceeds the
cost of attending college.
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Economists put the rate of return of
a degree in 2012 at 15%, far
above the return on stocks and
bonds.
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This is true even for so-called
“underemployed” college graduates.
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Return to Bachelor’s Degree, by Major 2012
College Graduates
Overall
Underemployed College Graduates
Total, all majors
15%
12%
Engineering
21%
17%
Math and computers
18%
14%
Health
18%
13%
Business
17%
14%
Communications
15%
13%
Technologies
15%
12%
Social sciences
15%
12%
Sciences
14%
12%
Architecture
14%
8%
Liberal arts
12%
9%
Agriculture and natural resources
11%
9%
Leisure and hospitality
11%
9%
Education
9%
7%
May 5, 2015
©ofArizona
State
18 Pricing
U.S. Census Bureau, American Community Survey; U.S. Department
Labor, O*NET;
U.S. University
Department of Education, Digest of Education Statistics 2012; The College Board, Trends in College
2013 and Trends in Student Aid 2013
Mean Earnings by Age, 2009
$180,000
Professional
degree
$160,000
Earnings
$140,000
Doctoral
degree
$120,000
Master’s
degree
$100,000
$80,000
Bachelor’s
degree
$60,000
Associate degree
Some college
$40,000
High school
$20,000
0
25
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33
37
41
45
Age
49
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2009 American Community Survey (ARC) Integrated Public Use Micro Sample
People who “learn to learn”
continue to earn over their lifetime
and earn more. Those who do not
see their wages remain flat as
they age.
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© Arizona State University
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As time passes and more learning
is needed, the earnings gap
widens for younger generations.
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Rising Earnings Disparity Between Young Adults
With and Without a College Degree
Median annual earnings among full-time workers ages 25 to 32,
in 2012 dollars.
$50,000
$44,770
$45,000
$40,000
$45,500
$43,663
$41,989
$38,833
$36,498
$35,000
$34,595
$33,655
$32,299
$31,384
$32,173
$30,525
$30,000
$30,000
$27,883
$28,000
$25,000
$20,000
Silents (1965)
Early Bloomers (1979)
High School Graduate
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Late Bloomers (1986)
Two-year Degree/Some College
© Arizona State University
Gen Xers (1995)
Millenials (2013)
Bachelor's Degree or More
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Pew Research Center tabulations of the 2013, 1995, 1986, 1979, and 1965 March Current Population Survey (CPS) Integrated Public Use Micro Samples
Value to Society
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© Arizona State University
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Percent Change in Employment Since Start of Recession,
Sorted by Educational Attainment
15%
9.1%
10%
5%
0%
0%
-5%
-9%
-10%
-15%
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College graduates
High school graduates
Arizona State University
(no©college)
Mar-2013
Dec-2012
Sept-2012
Jun-2012
Mar-2012
Dec-2011
Sept-2011
Jun-2011
Mar-2011
Dec-2011
Sept-2010
Jun-2010
Mar-2010
Dec-2009
Sept-2009
Jun-2009
Mar-2009
Dec-2008
Sept-2008
Jun-2008
Mar-2008
Dec- 2007
-20%
-14.1%
Some graduates/no B.A.
Less than high school
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Bureau of Labor Statistics, via Haver Analytics
Unemployment Rates Among Individuals Ages 25 and Older
Unemployment Rate
16%
Less than a High School Diploma
Some College, No Degree
High School Diploma
Associate Degree
Bachelor’s Degree or Higher
14%
12%
10%
8%
6%
4%
2%
0%
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2014
Year
The discrepancy between graduates from college and high school has grown far worse in recent
years.
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© Arizona State University
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Education Pays 2013: The Benefits of Higher Education for Individuals and Society, College Board
Recovery from the Great Recession
has not occurred for workers
without a college degree.
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Employment has fallen for high
school graduates while it has grown
for degree holders.
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College graduates are more
likely to…
Have access to and participate
in employer-provided pension
plans
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College graduates are more
likely to…
Have access to employerprovided healthcare
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College graduates are more
likely to…
Lead a physically active
lifestyle
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College graduates are more
likely to…
Participate in both vigorous and
moderate exercise
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College graduates are more
likely to…
Spend more time per day with
their children
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College graduates are more
likely to…
Participate in volunteer
activities
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College graduates are more
likely to…
Demonstrate a greater
understanding of political
issues and are more likely to
vote
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College graduates are less
likely to…
Smoke
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College graduates are less
likely to…
Suffer from obesity
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College graduates are less
likely to…
Have children who suffer from
obesity
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College graduates are less
likely to…
Live in households below the
poverty threshold
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College graduates are less
likely to…
Participate in public
assistance programs
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Educational Attainment and
Public Assistance
Percentage of individuals 25 and older living in households participating in selected public
assistance programs by education level
Less than a
High School Diploma
High School Diploma
Some college,
No degree
Associate Degree
Bachelor’s degree
or higher
50%
Percentage Participating
43%
40%
30%
24%
20%
19%
24%
22%
17%
9%
10%
11% 9%
12%
7%
10%
2%
7%
2%
0%
Medicaid
May 5, 2015
School Lunches
© Arizona State University
SNAP
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Education Pays 2013: The Benefits of Higher Education for Individuals and Society, College Board
Is there value in earning a college degree to
the individual? YES.
Is there value in earning a college degree to
the economy and to society? YES.
May 5, 2015
© Arizona State University
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Then why do people still ask if
college is worth it?
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Questions, Comments,
and Reactions
Larry.Goldstein@Campus-Strategies, LLC
540.942.9146
May 5, 2015
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