I tend to be fairly opinionated when it comes to college and whether or not it is a benefit financially, so I was intrigued to read this article over at FreeMoneyFinance which referrences this article on Yahoo news. You can read both articles for youself — and I hope you do — but in summary they point to studies that show that college grads earn about $23,000 more a year than non grads. I think this is terribly misleading. Let me explain why.
What is not mentioned is the work sectors that make up the survey, so we must assume that they cover all of them. This means that high paying jobs that definately require a college degree such as medical professions and lawyers, are going to skew the results. Everyone pretty much knows that if you want to be a doctor, lawyer, chemist, etc. that it is more or less impossible to get a high paying job without having a degree. Therefore those career fields should not count.
Why? Because you can not compare a doctor’s salary that went to college against a doctor’s salary that did not go to college. What you can compare is the salaries of individuals in the same career fields that have and have not gone to college. Take the classic business degree graduate. While it might be hard in some corporate environments to rise to the top without a degree, it is not impossible, so therefore you could find two CEOs with one having a degree and the other not and see what the difference in salary range is.
Ok, so the CEO position may not be realistic because they tend to make millions so 23k isn’t that big of a difference. So let us take my current career field which is software development. I have met and known a lot of people with computer science degrees of various levels and I have found no correlation between their skills as a software developer and their degree. I have worked with PhDs at national laboratories that really knew their stuff and some that couldn’t program their way out of a room with an open door. I have met people that have masters degrees that admited they couldn’t design an enterprise level application.
What is interesting about the IT field is that the average salary is right at the average salary for college grads as stated in the article, $78,000. Do I make more than they national average? Yes I do, enough to be noticable, and in case you haven’t guessed yet I do not have a degree. The IT field also has a good mix of college graduates and non-college graduates.
I did say that I do not have a degree, but I did start go to Devry many years ago because I fell into the trap of thinking that I had to have a degree to get a job (I had recently left military service at this point). What really frustrated me was the school wasn’t teaching me fast enough what I needed to know, it was teaching me 20 year old technology. Anyway I got my first job, and ironically it wasn’t my going to school that got it for me, it was my military background. My boss told me later that he hired me for my military background (unrelated to IT) over college graduates because he figured that if I could take the military then I could handle a corporate environment.
What is really interesting though is that the survey also doesn’t show the number of people with degrees outside their current career field. I have met people that went to college and gotten degrees in architecture, electrical engineering, phycology, business and a few others that are not working in their degreed field. So with maybe a few exceptions the money they spent on a degree has no bearing on their current salary.
I am not naive enough to think that everyone can do well without going to college. Some people don’t learn well on their own, they need someone to teach them, and that is fine. What I have a problem with is the notion that if you don’t go to college you won’t make good money or be successful. You can make up some of that $23,000 difference even if you don’t have a degree by either striving for a better job or even better, maybe you can start your own business and go beyond that 23k. Yes I do know a few people who own their own business and they personally make between $80,000 to about $200,000. Degree required? Nope, not one has a degree in their business of choice.
While I don’t mean to offend any college grads out there, I am reminded of one of my favorite movies. From Good Will Hunting, Matt Damon’s character makes a comment to another about how his high priced degree could be had for a buck 25 in late fees at the local library.
So does a degree earn you a significant amount more than your peers without a degree? I would certainly be interested to find out.
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Good rebuttal to the article. I am one of the people you mentioned briefly that has a degree, but I’m not doing anything even remotely related to what my degree was. That could be seen in two different ways. Could have been a waste of 5 years and a ton of money, or it could have been worth every penny.
In the finance field, depending on the exact position, in many cases to be considered for a job you need a college degree. But, often it doesn’t matter what your degree is in. Of course that isn’t across the board, but a common trend. That isn’t to say that just because company A’s job posting requires a degree you couldn’t go to company B and get into a similar position without one either.
And I agree with you that professions like doctors and lawyers and such that require a degree to even be in that profession can skew the data, I also would argue that the number of people without degrees and not working can skew the data in the same way. Think of how many people are without a college education or even high school and are on welfare or making well below the poverty line. The number of these types of people far outnumber the doctor and lawyer types that may skew the data.
Of course, most of this is irrelevant without knowing exactly what census data was used to compile these results. The article did not specify. This could mean the numbers they provided are an accurate nationwide average, or they could be certainly skewed in one way or another depending on the exact data set used.
Good arguments on both side though. Clearly it is possible to make as much or more as a college grad even if you didn’t get a degree, just like it is just as possible for someone to spend all that money getting a degree and end up doing something that earns less than the average.
Good points Jeremy. I didn’t look at the idea that getting the degree was worth the money on a personal level. I also agree that in some fields (you mention finance) that you almost have to have a degree to be considered, even if for no other reason than the company doing the hiring makes it such a requirement. I made a soft reference to that with regards to general business professionals. In other words, it isn’t always easy to go up the corporate ladder without some sort of business degree.
You also make a good point about those on welfare or other assisted incomes skewing the averages the other way, I had not considered that. For that matter it is entirely possible that there are college graduates that are below the poverty line or even out of work collecting unemployment.
Great comments. Thanks!
I think you have to look at the odds of success not just the fact “it’s possible” to make as much either way. I’m a software engineer (with a degree) and I don’t really feel that the degree made me a better software engineer at all. However, almost all the positions I have ever applied to (and it’s numerous), require a degree to be considered. Thus I feel if I didn’t have the degree, my choices would be more limited. I might even find myself out of work for an extended period of time like I was with the dot-com bust.
I also know several people who went to college not thinking they’d become doctors or lawyers, but have. If they had decided on not going for a degree, they would have been excluded from those high paying professions. For that reason, I think you should include them and not pretend like they don’t exist.
Also could we exclude all the professional athletes, musicians, or celebraties that don’t have degrees because they may not use them in their job (with the exception of many musicians and more than a few actors).
Overall, I’d try to not to be concerned with “what’s possible” and look at “what’s probable.”
Good point LazyMan. I’m surprised I didn’t think of the professional athetes myself. As for the jobs that say they require a degree, especially in our career field, all that I have seen or applied for said they required a degree but would substitute experience. Of course this makes it difficult for the person just getting start as they have no experience.