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College is 'worth it' but majors matter
There's a wide variation in unemployment rates by field, and lingering confusion over what "college" means. - photo by Eric Schulzke
Unemployment rates are falling for most college majors, and the employment gap between college graduates and those with merely a high school diploma continues to make college a good, almost necessary bargain, says a new report using Census Bureau data.

College graduates on average enjoy much better employment outcomes than experienced workers with just a high school diploma, according to From Hard Times to Better Times, just released by the Georgetown Center on Education and the Workforce.

The report also distinguishes unemployment and earnings data based on college major. It turns out that behind the average that tells us a college degree is "worth it" are huge variations depending on field of study, according to Anthony Carnevale, the centers director and lead author of the report.

Unemployment rates are very low for recent graduates in agriculture and natural resources majors (4.5 percent), physical sciences (5 percent), and education (5.1 percent), but graduates in architecture (10.3 percent) and the arts (9.5 percent) struggled.

On pay scales, the gaps are similar. Recent graduates in arts, psychology and social work earned $31,000 per year, just $1,000 more than the average experienced worker with just a high school diploma. Recent graduates in engineering, by contrast, earn a hefty $57,000 per year.

People need better information to make informed decisions, and thats where Carnevales work comes in, said Matt Chingos, director of the Brown Center on Education Policy at the Brookings Institution.

Better data

The debate over whether college is worth it has been at a high pitch since the housing crash of 2008 and the Great Recession that followed. With tuition prices continuing to climb faster than inflation, and fears of student debt growing, everywhere you turn someone is asking the question. And almost always, they resolve it with, yes, on average, college is worth it.

Today there is better data than ever on career outcomes, said Alan Benson, a business professor at the University of Minnesota, and that's largely because of the American Community Survey, which the Census Bureau has been doing every year since 2005, but only recently has added college major questions.

The inclusion of that question reflects the recent dialogue on college and career training costs and outcomes, Benson said, including efforts within the Obama administration to better measure costs and benefits.

And yet, as good as the new data is, Benson would like more. One piece of the puzzle that needs attention, Benson said, are the many students who launch a four-year path but dont finish. On average, about 60 percent of the first-time students going full-time at a four-year school finish their degrees within four years.

The value proposition is the worst, Benson said, when you are in the 5th or 6th year of a four-year degree and are not sure if you are going to acquire it, especially when the degree you are pursuing is not tied to much higher income.

Many of the skeptics in the is college worth it debate focus on that six-year failure figure. Among the skeptics is Andrew Rossi, the director of Ivory Tower. As Rossi recently noted in a CNN op ed, "68 percent of students at public institutions do not graduate in four years, and 44 percent fail to graduate in six years. That means that nearly half of the students who are signing up for a public university education will not enjoy the wage premium promised to them, yet they may still be saddled with debt."

Confused terminology

In addition to questions about those who try and fail, Carnevale acknowledges rampant confusion over terminology. When people hear college, he notes, most think of a four-year program ending in a bachelors degree.

But this leaves a critical space of post-secondary education and training systems, including associates degrees and technical certifications leading to good-paying jobs in a no mans land. Much of this training occurs at colleges, including community and technical colleges, Carnevale said.

Ironically, the Georgetown report furthers the confusion by comparing mere high school diplomas to four-year degrees, without accounting for the large number of viable careers in between.

Carnevale himself is very clear on this distinction, and is a strong advocate of flexible post-secondary training. He notes that 30 percent of associates degree holders earn more than the average four-year college graduate, and that most technical certificates are now the most common outcome of post-secondary education.

Political leaders frequently fall into this confusion of terms, Carnevale notes. He points to President Obamas 2014 State of the Union address, where he said that every hardworking kid should be able to go to college and succeed when they get to campus, leading many to think he meant that everyone should get a bachelors degree. But later in the same speech, Obama made it clear he was speaking of all forms of post-secondary training, including many that would stop short of a four-year degree.

But he confused everyone, even all the reporters, Carnevale said. Our vocabulary has not yet caught up with our reality.

Useful information

Carnevales work makes an important contribution to the dialogue, says Matt Chingos, director of the Brown Center on Education Policy, because it gets people thinking about differences between fields and programs.

College is worth it, Chingos says, but that axiom hides the variation between schools and between programs in a school. The key, Chingos said, is not to regulate outcomes and punish schools that perform poorly, but to provide the consumers with exactly the information they need when they need it.

We need to offer better information, Chingos said, so students can see that some colleges and some fields pay off better than others. But Chingos hastens to add that reducing college outcomes to mere earnings can be deceptive. You also have to account for lifestyle and satisfaction, he said.

Evaluating a school by income levels of its graduates, Carnevale argues, is often just confusing. If you compare MIT to a state school that mainly produces teachers, of course the income levels will be vastly different, but that is not a reflection on those who choose to teach.

Overall, there are so many pieces of information that play into a college decision that even the experts, Carnevale acknowledges, are hard pressed to put them into a useful form.

People should begin to think of fields and programs rather than schools. The field of study matters, as does the highest level attained within that field, he said. Those two factors often matter much more than the prestige of the institution attended.
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