If you are a young, 20-something American then you probably have or are working to get a college degree. In the last 50 years the number of Americans with a college degree has risen dramatically to the point that it is the norm instead of the exception.
An article in National Review, called “Don’t Occupy Education”, had an interesting take on education and the Occupy Wall Street movement. The author, Charles Cooke, states what he believes is the problem:
It was, until a few years ago, possible to draw a direct line between the possession of a university degree, and a better paying job. This was not the product of a timeless ironclad equation, but because the default was not to go to university; to have a degree thus set one apart from the crowd. But if everyone has a degree, then nobody does.
The fact is that a large number of recent graduates are unemployed and frustrated that the opportunities available to them require little more than a high-school diploma. A bachelor’s degree just isn’t what it used to be.
The promise of a degree in the American economy is deeply alluring. At one time an American with a degree had a dramatically higher earning potential than the rest of the population. The cost and debt to obtain a degree was high, but would pay dividends down the line.
Pushing young Americans to enter academia and the professions in large part led to a decrease in manufacturing and blue-collar jobs.
The change was for the most part positive and put the country ahead of the world in technological advancements and innovation. The domination of American universities is nearly complete, occupying 45 of the top 100 spots in the Times Higher Education ranking list and nearly half of the top 200. This list may even be underrating the domination of American schools because it the list was created in a Europe.
While more Americans have flocked to join the white-collar world of expertise and technicians, the traditional manufacturing industries have gone into a slow, sad decline. Blue-collar towns like Detroit were hit hardest as American car companies became uncompetitive and eventually bankrupt. Its decline was because of a combination of factors some within and some outside of the control of workers, companies and policy makers.
American manufacturing has been operating using mid-twentieth century norms. Uncompetitive levels of pay and benefits for workers couldn’t work in the highly competitive globalized world that America operates in today.
For the American consumer this increased competitiveness has been a good thing, as products are cheaper and often of a higher quality, but have left many others struggling to compete in the changed environment.
While a degree has been a gateway to greater opportunity and an engine of American innovation and growth, the times are changing again. In the current economy, the recently graduated strain to find any kind of gainful employment. They often struggle for years with low-paid or unpaid jobs.
These difficulties are not just for those with a bachelor’s degree, but extend even to those with law degrees and higher degrees. Many law firms today are not giving new lawyers the same pay and opportunities that were nearly a given in the past.
It is hard to go through nearly a decade of work in higher education to take a greatly diminished job. Being strapped with a mountain of debt makes it worse.
The rapid change in economic circumstances will undoubtedly create a shift in how Americans approach the economy. If any country can make a dramatic shift it would be the United States; a country with the most powerful and dynamic economy that the world has ever seen.
Like the housing bubble, the degree bubble is bursting and leaving a lot of middle class Americans dealing with the mess left behind.
If there is an answer to fixing the mess it could be in making the economy more diversified, something that has been lessened by the dramatic shift of recent generations to the knowledge and service industry. Better tapping into the vast natural resources like oil and natural gas, made possible by those advancements in technology, is an important first step.
The great Founding Father of the United States, Alexander Hamilton, who perhaps understood economics and finance better than anyone in his generation, once said of economic diversification in his famous Report on Manufactures,
When all the different kinds of industry obtain in a community, each individual can find his proper element, and can call into activity the whole vigour of his nature. And the community is benefitted by the services of its respective members, in the manner, in which each can serve it with most effect.
Tapping into energy resources, creating a pro-growth business environment and cutting down on legal red-tape has made states like North Dakota particularly successful in even the most catastrophic national economy that America is dealing with today.
Americans now, like always, must learn to adjust to rapidly changing economic circumstances. Higher education will continue to be important, but Americans must learn to deal with its limits.
Mark Twain, once said,”I have never let my schooling interfere with my education.”
The times are changing. It’s time to put our Yankee ingenuity to the test.