Recent news stories fret about the deep drop in college enrollment over the past few years. Even after the pandemic and the resumption of in-person classes, college enrollment has not rebounded. Many smaller institutions are facing serious financial trouble, and some have had to close. It may be, however, that the industry chaos is the result of perfectly rational decisions by young people who have recognized that the job market has changed.
The vaunted college premium may be overstated. According to one recent study, more education does not equal higher lifetime earnings. According to that study, approximately 16% of high school grads and 28% of workers with an associate’s degree earn more than half of those with a bachelor’s degree, and 36% of workers with a bachelor’s degree earn more than half of workers with a master’s degree. Simply “getting the paper” no longer is a guarantee of increased income.
Furthermore, college no longer is the only way to land a high-paying job (if it ever was). There are more jobs available that don’t require degrees. Many large employers no longer require college degrees. Skilled trades face a serious shortage of workers, and companies are willing to pay a premium for trained craftspeople.
It’s too soon to say how the higher education market will shake out. What is clear is that colleges and universities can no longer compete only with each other, but now must contend with the perception that students have cheaper and more direct alternatives for careers.