Data from Doctor Housing show that student loan debt has surpassed credit card debt. Student debt has reached $829 billion because of rising tuition costs, increasing numbers of people going to college, and lack of savings by families for college. College students are graduating with an average debt of $30,500, but it isn’t uncommon for that amount to be $100,000 or more. Many students graduate from paper mills or even highly rated colleges and universities with degrees that don’t provide a path to employment. Some people deal with the issue of not being able to afford payments by continuing to attend classes, since the payments on the debt aren’t due while they are in school.
What are the colleges providing to these young people besides a degree and massive debt? A new study found that 45 percent of the students learned very little in the first two years of college and about a third of them have not improved their performance in academic skills by the time they graduate. The 3000 students participating in the study spent 16 percent of their time in class or studying and 75 percent socializing and sleeping. Many professors are focusing on research that will build their academic reputations, and are less interested in teaching.
People should begin to evaluate college options the way they would study a business opportunity. Will there be jobs in the chosen field of study that will pay for the student loan debt and perhaps even provide a decent living beyond that? There are plenty of data about which degrees provide the best opportunity for a decent job. It shouldn’t be a surprise that completing more difficult courses of study, such as engineering, gives a better chance to land a job that pays decently. I’m guessing that the easier courses of study result in fewer job opportunities and jobs that don’t pay much. That probably won’t deter the flood of students into easy courses that won’t detract from having fun in college.
What about the role of the colleges? I’ve read that it is becoming easier to get good grades, which keeps more students in the classes. The reduction in the quality of education has been accompanied by increasing costs. One report stated that economists predict the cost of attending state colleges will soar to $120,000 by 2015. Tuition costs have increased just under 467% since 1986 compared to the overall inflation rate of 107%. Of course the government contributed to the problem by making it easy to get government-backed student loans. Colleges raised tuition to take full advantage of the flood of new students with their easily-acquired loan money. Some are adding luxurious amenities in the form of fancy dorms, gyms, live music in the cafeteria, and Starbucks gift cards to lure students.
There are undoubtedly many factors to consider for a family making a decision about which college and which course of studies. A recent report observes”…the average lifetime incomes of comparably talented graduates of public and private institutions are about the same for most students.” I remain convinced that the ultimate success of a student graduating and entering the business world depends on individual skill, discipline, and a desire to perform well. There is a constant drumbeat of demand for more money for education at all levels, but increasing the amounts spent hasn’t improved education.