Careers and Job Markets

Pathways Giving College A Run For The Money

“Your money or your life” was a popular hold-up phrase in old westerns, but it also applies to the feeling most students and their families have today regarding the long road to a college degree. Either put up the money for all the stuff leading up to a college degree or give up the opportunity for a lifetime of high earnings. However, this is a distorted reality because it only focuses on a potential future salary. It ignores the substantial financial cost and time investment required, the transforming economy, and the present-day quality of life that can seriously erode the net benefit to students. When the cost of time, money and quality of life are factored in, there are plenty of post-secondary pathways that give college a run for the money. 

To begin with, we must challenge our assumption that a college degree is a guaranteed pathway to high earnings. In a dramatically transforming economy where businesses can’t forecast three years into the future, how is it possible to determine lifetime earnings? It assumes stability that goes counter to the technology-driven upheaval we are currently experiencing–where an estimated 85% of jobs by 2030 haven’t been invented yet and the average full-time job for 25 to 34-year-olds lasts 2.8 years.  

Further, college degrees (associate and bachelors) are only required for 24% of all jobs in the entire economy today with masters and doctorates needed for another 4 %, according to the Bureau of Labor Statistics.  This oversupply of degrees in many fields has led to wage stagnation and underemployment for graduates. According to the New York Fed, Americans with bachelor’s degree salaries earned less last year in real terms than in 1990 while the cost of a degree and associated debt has skyrocketed.

Lastly, although 96% of academic officers at colleges and universities believe they are adequately preparing students for the workplace, only 13% of US adults and 11% of C-level business executives agree. This is a costly disconnect. 

While college may be the appropriate pathway for some students who are interested in specific fields, who have the financial wherewithal and/or have the life skills necessary to handle the independence, it is by no means the optimal path for all students. With 80% of students changing majors, half dropping out, and most taking over four years to graduate, we have to question our cultural goal of all students entering college right after high school. Their college-focused lives have left little time for them to truly explore what they are interested in, gain a perspective on the real world or develop the sense of self required to navigate the changing world.

Record low unemployment, 7.2 million unfilled jobs and demand for work-related experience in industry-specific skills, has led concerned individuals, businesses and various government entities to create or expand short-term, less expensive pathways to “skill” and “up-skill” workers. Economic growth is not possible without them.   

Start-at-the-bottom corporate training programs have been around for a long time. My two nephews, now in their early 30s, chose this pathway. At the time, we were all horrified. How would they succeed in life without a college degree? They were high school varsity athletes, financially able to attend college and one even had a scholarship. But they were not interested in further schooling and after graduation, they went to work for companies where they started in entry-level positions: one in the warehouse, one as a truck driver. Through their hard work and dedication, as well as in-house training, they rose to become managers. They now earn more than college graduates their age ($81,000 and $110,000) with the added advantage of being debt-free. They own homes and are able to make advancement choices based on time values, not financial necessities.  

Increasingly, companies are recognizing the huge untapped pool of candidates available without a college degree, particularly those with the work ethic and interpersonal skills such as my nephews demonstrated. Google, Apple, IBM, Ernst & Young, and others have publicly committed to hiring them. According to a 2019 Strada-Gallup survey, 77 percent of those involved in hiring decisions would consider hiring someone without the desired degree and 62 percent have done so

In 2018, 75% of the jobs posted by JPMorgan Chase–the largest US bank–did not require a college degree. Apple announced that 50% of their hires did not have one. Although many companies still say they require a degree (often attributed to “degree inflation”), the phrase “or equivalent experience” appears regularly.  

UpSkill America is an employer-led movement by the Aspen Institute to encourage reskilling workers. Amazon recently joined this effort by pledging to upskill 100,000 workers. The program includes a Machine Learning University and Amazon Technical Academy. According to UpSkill America, “Amazon is focused on creating pathways to careers in areas that will continue growing in years to come, including healthcare, machine learning, manufacturing, robotics, computer science, cloud computing, and more.”

Apprenticeships are another pathway where students are paid while they learn. Because trade schools fell out of favor when the college-for-all movement began in earnest a few decades ago, there is an increased demand and limited supply of traditional tradesmen–such as welders, electricians, plumbers–which is pushing up salaries. Bloomberg reported plumbers in Atlanta earn $90,000 in wages and commissions — a salary that’s 70% higher than the region’s average income. This is after a four-year paid apprenticeship and passing a licensing exam.

The apprenticeship model is expanding to other fields as well. Praxis was created to provide community and support to students desiring a different pathway as they prepare for well-paying jobs in marketing, sales, and operations. They promote their program as follows:

Praxis is a one-year program where you gain mastery of professional skills, apprentice at a high-growth startup, and build the network and experience you need to create a great career. This is about getting real, meaningful work now – 96% of Praxis grads get hired at the end of the program and the average salary is $50,267.

Tuition for the full program is $12,000 while earnings during the apprenticeship come out to $14,400 or more, so you walk away with a net gain of $2,400. No college degree required.

In June 2019, the U.S. Department of Labor announced awards of $183.8 million for apprenticeship programs in sectors specifically related to local economies. For example, there are apprenticeship programs for aerospace in California, healthcare in Colorado, computer technology in Illinois and advanced manufacturing in New York. Since 2017, there have been half a million new apprenticeships created. This is only accelerating. 

Lastly, immersive training programs and boot camps are additional examples of pathways giving college a run for the money. The Flatiron School, which is now owned by WeWork, was one of the original creators of this new field. They offer immersive 15 – 24-week training in high demand fields like software engineering, data science, and UX/UI Design. Their reported employment and salary data are impressive with 97% of their on-campus students being employed at an average salary of $74,000 and 94% of their online students employed at an average salary of $67,000.  

If we were really held up, most of us would choose our lives and the lives of our children over the money.  Yet with all the information we now have about the changing economy, we still insist that they pursue a potential lifelong salary by following a narrow trajectory to a college degree. We continue to sacrifice their childhoods, their ability to develop authentic relationships, our time with them and our retirement savings to ensure that they get into college–ignoring the fact that most don’t make it through at a reasonable cost of time and money. The epidemic levels of debt and mental illness are not worth it. 

Whether a student goes to college or chooses an alternative pathway should be based on the individual student’s interests and needs. More financial aid would be available for those needing a college degree for their desired field if we weren’t trying to send everyone through the same system at the same time. Many of us are just waking up to this new reality. It is now time for us to build the social and educational infrastructure to allow our students the choice.

 

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