A question that gets trotted out every so often by personal finance bloggers, pundits, and Millenials is both simple and complex. Is a college education still worth its cost? People on both sides of the issue can get pretty heated about it and despite several debates on the topic, I still haven’t made up my mind. Frankly, the most likely answer is: it depends.
Based on numerous conversations with people of all ages and careers, I’ve summarized the main arguments both for and against college education below.
Why a college education is a good investment
Many jobs require a degree
Pretty much any white-collar position, and an increasing number of skilled blue-collar positions require some sort of degree. Sometimes it is a specific program, such as Engineering, Finance, Education, Medicine, or Law. Some sectors, like IT, definitely require an IT degree to excel. In these cases, a college education means that you have learned specific skills necessary to succeed in those fields. If you are interested in working in one of those industries, a college education is pretty much a no-brainer. All you have to really decide is how you are going to pay for your schooling.
Other times, HR just wants to see a diploma. They want proof that you can stick through something and see it through, despite taking years and lots of work. The anti-college folks would argue that in these cases, college really is a waste of time and you are spending tens of thousands of dollars for no reason. Well, the fact remains that if you don’t have a degree and the job posting requires one, there are plenty of college-educated applicants who will take your place.
Exposure to new ideas and cultures
Regardless of whether or not you actually learn anything in class, you will almost certainly be exposed to new ideas and new cultures. I’ve yet to use my degree in Physics in any meaningful way, but I use skills I learned from my roommates and housemates on a frequent basis. I also gained exposure to Indian, Italian, Algerian, French, and Czech cultures; something I never received in the small town in which I was raised. Kind of hard to get exposure to other cultures when over a quarter of the town is related to you in some way!
People with a College Education Earn More
According to research by the Department of Education, people with at least a bachelor’s degree earn 38% more than those with only a high school diploma. In fact, while college educated workers have seen wages increase over the last 2 decades, unskilled workers have seen their wages decrease in real dollars over that same time.
Why a college education is a waste of money
Skilled Labor pays pretty well
One of the reasons that college educated workers earn more on average is because high school educated workers encompasses a lot. Auto mechanics, plumbers, and electricians get lumped in with assembly line workers and flaggers. But skilled labor pays pretty well. Think about the last time you took your car to a garage, or had to call a plumber. $90 per hour, anyone?
Changing careers moots old training
If you decide to change careers down the road, or even just retire early, all that time you spent pursuing specialized training gets mooted. The three years I spent in the teacher education training were certainly wasted.
Earlier this week, Emily from Evolving Personal Finance made the reverse of this argument. She argued against early retirement because of the decade she has spent pursuing her education through bachelor’s, master’s and Ph.D.
Free education sources available online
Probably the biggest argument against a college education is that pretty much all of that information is available for free online these days. MIT, Standford, and dozens of other universities have opened up their curriculum online for all to read. Meanwhile, for a recent job interview, I skipped the need for taking courses related to construction materials testing because public domain training videos produced by the State of Washington were available on YouTube.
Do you think a college education is still worth it in this day and age?