After the financial crisis in 2008, finding employment for
some seemed to be an almost impossible task (unless you were willing to take a
low-wage position), especially for those who had just graduated from college.
Previously, obtaining a college degree basically meant certain employment and a
higher wage, however this was not the case after the financial crisis. People
began to question the value of a college degree, was it actually worth the time
and money? Those who just had their high school diplomas seemed to be having
the same amount of difficulty finding a job, and were earning wages that were
comparable to those of college graduates. Fortunately for us as current college
students, things seem to be turning around for young college grads. As this
article by Josh Zumbrun discusses, incomes for the newest college grads are
higher than they have been for over a decade and unemployment rates of recent college
grads have also been decreasing (4.9% in September). From the latest data, the median
wage of those obtaining a bachelor’s degree increased from $40 to $43 thousand
(adjusted for inflation). While this may not seem necessarily like a
significant huge difference in amount, it is certainly a step in the right
direction. In addition, the top 25% of recent college grads are earning wages
of at least $60 thousand. Previously, incomes for college graduates had been
declining (but not as fast as those without degrees), and now these incomes
have returned to numbers that we haven’t seen since 2003. This news is
certainly good news for us as soon to be college grads entering the labor
force. However, not only is this good news for us, but I also see it is as good
news for higher education institutions in general. For higher education
institutions such as OWU I believe that this will instill confidence for those
considering the investment of a degree, and I think we can see a rise in class
numbers as the value of a degree continues to progress.
What do you think this means for the future financial
stability of colleges as people start to see the monetary value in higher
education once again? Will small liberal arts institutions who have seen a
decline in class numbers such as Ohio Wesleyan, Denison, Kenyon, etc. start to
see a rise in their numbers again?
I think this is great news for not only those who are currently earning and a college degree and those who intend to, but as you stated as well for the institutions themselves. When I started at OWU almost four years ago now, I was faced with a lot of the same questions that were stated in the early part of this article. It is great to see that data and salaries will be able to once again show future college students the monetary benefits of investing in a degree and I think this will only continue to help the institutions as well and see their enrollment begin to increase again with this increased confidence in future success from obtaining a degree.
ReplyDeleteFor those who take loans out to pay for their education this is especially good news because paying off loans will be quicker and less burdensome if you can find a good paying job. Also I agree with Ashley, this news also motivates those who are on the fence of seeking a college degree, to invest the money to obtain one and of course it's also very positive for the institutions as well.
ReplyDeleteI think wealthier college alumni and larger incoming classes filled with students drawn in by the appeal of higher wages caused by jobs only available with a college degree will cement the financial stability of colleges, especially with institutions like OWU and other liberal arts colleges that are known for rewarding academically focused students and atheletes with scholarships.
ReplyDeleteIt is interesting to note however, that while income for new college grads is on the rise, it has only just reached levels previously seen in 2003. While inflation rates were brought down heavily by the FED since 2008 in order to get people and banks to spend and loan their money, inflations have still increased since then, especially between 2003-2007, where the FED funds rate grew to 5%, before dramatically falling with the crash at just above 0%. When the income of college grads can be seen as outperforming previous years, like 2003's averages, while accounting for inflation, I think it will not only represent a brighter future for students who invest in a college degree, but a sign of a recovery for the economy as a whole.
This is a great article that can help, specifically, Ohio Wesleyan, but all other schools as well. The decline in enrollment over the last few years and upcoming future years can possibly be combatted if it can effectively promote these statistics. Debate has risen recently over the opportunity cost of going to school, or getting a job straight out of high school, and I believe these statistics prove the benefits of receiving a higher education.
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