Why We Shouldn’t Consider a Bachelor’s Degree a Luxury

tt51.jpgIt’s becoming a luxury for many; yet failing to have a college degree can have significant financial repercussions.

I’m referring to the need for a college education and its first cousin, the ability to pay for that education. A few simple facts. Having a college education results in huge, lifetime dividends.  A person with a college degree, on average, will earn $1.4 million more than someone with only a high school diploma, according to a 2011 U.S. Census Report. That bears repeating:  $1.4 million more. To put it in even more unambiguous language, if you started working at 22 and retired at 62, that would mean $2,916.66 more each month during that 40-year career.  (Of course, this advantage is slight if at all at the beginning of a career and increases later as one advances professionally.) For anyone pondering why they should go to college, the numbers provide a stark reality.

The costs of graduating, however, are having a dulling effect on the shiny benefits of attending and graduating from college. College costs have continued to rise for decades, beating out the rate of inflation for 30 years. The average student loan is $28,400 — a huge burden to bear for a twenty-something person.  I have a friend who explains it this way: “Your son goes to college and leaves the institution with a debt equaling the national average,” he told me.  “He meets a girl in college, and they fall in love. She too graduates with a degree and the same loan amount. They marry within a year, and the “dowry” to themselves is $56,800, and they’re just starting out in life. Regardless of future potential income, that’s an anchor that will be a drag on future earning for years, if not decades.”

While I have always been concerned about college costs, it is hitting home for me now these days. My oldest son, who I affectionately call “The Franchise”, begins college this fall and I have a firsthand appreciation as to how we are pricing college out of the reach of the middle class.  The idea that college is becoming a “luxury item” is a terrible thought to contemplate. I have pointed out the benefits of attending school, but no one should be forced — either student or parents — to line up for the poorhouse or accept to be anchored to payments, which can cause a financial drowning.

There is hope and, even more appropriately, a possible solution. I have introduced a proposal, ACR220, which encourages “four-year institutions of higher education to offer baccalaureate degree programs that cost no more than $10,000 in tuition and fees.” To be clear, that’s $10,000 for the entire degree and not just an academic year (or semester).  One of the main policy challenges in the area of higher education is affordability, and more importantly, the need to think differently as to how we tackle this problem. Far too often, we have relied on policies that seek to subsidize the escalating cost of a college degree, without realistically looking at driving down that growing price tag.

Why is this important?

Our nation’s economy demands a workforce that possesses increasing levels of knowledge and skills that are best attributable to a college degree. Absent a system that can produce enough graduates to meet this demand, we will cede ground to other countries that are more prepared to deliver the type of workers that a 21st century economy requires. This in my opinion is of critical importance to our nation’s economic and security interests. We must ensure that our country has the skilled workforce and educated citizenry necessary to sustain economic growth and nurture an environment of shared prosperity.

Don’t just take my word for it, a 2013 study by Georgetown University’s Center on Education and Workforce that found the United States economy will have a shortfall of 5 million college-educated workers. Furthermore, by 2020, 65% of all jobs will require a bachelor or associate degree or some other education beyond high school. Without a higher education framework that reduces the cost of attaining a college degree, we will be forced to look elsewhere to fill those openings.

This idea is not a pie-in-the-sky idea, nor is it wishful thinking. Some states, such as Texas and Florida, are at the forefront of this movement. Texas A&M-San Antonio became the first institution of higher education in Texas to offer a bachelor’s degree in information technology for less than $10,000.  Twelve colleges in Florida are either developing proposals (or are in the process) for $10,000 bachelor’s degree programs. Oklahoma and Oregon are also considering similar proposals, and Southern New Hampshire University has instituted its College for ALL Program, which offers a $10,000 competency-based bachelor’s degree.

We simply cannot afford as a state and as a nation, to allow college costs to continue to rise, thus elevating the opportunity to pursue college as a sign of “luxury” status in our society. ACR220 is designed to jump start this critical conversation that is occurring at countless family tables in New Jersey every night: “How can we make college more affordable?” Offering baccalaureate degree programs that cost no more than $10,000 in tuition and fees will greatly increase the ability of New Jersey students to attend an institution of higher education and acquire the training needed to secure good, high-paying jobs and will significantly reduce their student loan debt. That’s my take. What’s your take?

It’s becoming a luxury for many; yet failing to have a college degree can have significant financial repercussions.

I’m referring to the need for a college education and its first cousin, the ability to pay for that education. A few simple facts. Having a college education results in huge, lifetime dividends.  A person with a college degree, on average, will earn $1.4 million more than someone with only a high school diploma, according to a 2011 U.S. Census Report. That bears repeating:  $1.4 million more. To put it in even more unambiguous language, if you started working at 22 and retired at 62, that would mean $2,916.66 more each month during that 40-year career.  (Of course, this advantage is slight if at all at the beginning of a career and increases later as one advances professionally.) For anyone pondering why they should go to college, the numbers provide a stark reality.

The costs of graduating, however, are having a dulling effect on the shiny benefits of attending and graduating from college. College costs have continued to rise for decades, beating out the rate of inflation for 30 years. The average student loan is $28,400 — a huge burden to bear for a twenty-something person.  I have a friend who explains it this way: “Your son goes to college and leaves the institution with a debt equaling the national average,” he told me.  “He meets a girl in college, and they fall in love. She too graduates with a degree and the same loan amount. They marry within a year, and the “dowry” to themselves is $56,800, and they’re just starting out in life. Regardless of future potential income, that’s an anchor that will be a drag on future earning for years, if not decades.”

While I have always been concerned about college costs, it is hitting home for me now these days. My oldest son, who I affectionately call “The Franchise”, begins college this fall and I have a firsthand appreciation as to how we are pricing college out of the reach of the middle class.  The idea that college is becoming a “luxury item” is a terrible thought to contemplate. I have pointed out the benefits of attending school, but no one should be forced — either student or parents — to line up for the poorhouse or accept to be anchored to payments, which can cause a financial drowning.

There is hope and, even more appropriately, a possible solution. I have introduced a proposal, ACR220, which encourages “four-year institutions of higher education to offer baccalaureate degree programs that cost no more than $10,000 in tuition and fees.” To be clear, that’s $10,000 for the entire degree and not just an academic year (or semester).  One of the main policy challenges in the area of higher education is affordability, and more importantly, the need to think differently as to how we tackle this problem. Far too often, we have relied on policies that seek to subsidize the escalating cost of a college degree, without realistically looking at driving down that growing price tag.

Why is this important?

Our nation’s economy demands a workforce that possesses increasing levels of knowledge and skills that are best attributable to a college degree. Absent a system that can produce enough graduates to meet this demand, we will cede ground to other countries that are more prepared to deliver the type of workers that a 21st century economy requires. This in my opinion is of critical importance to our nation’s economic and security interests. We must ensure that our country has the skilled workforce and educated citizenry necessary to sustain economic growth and nurture an environment of shared prosperity.

Don’t just take my word for it, a 2013 study by Georgetown University’s Center on Education and Workforce that found the United States economy will have a shortfall of 5 million college-educated workers. Furthermore, by 2020, 65% of all jobs will require a bachelor or associate degree or some other education beyond high school. Without a higher education framework that reduces the cost of attaining a college degree, we will be forced to look elsewhere to fill those openings.

This idea is not a pie-in-the-sky idea, nor is it wishful thinking. Some states, such as Texas and Florida, are at the forefront of this movement. Texas A&M-San Antonio became the first institution of higher education in Texas to offer a bachelor’s degree in information technology for less than $10,000.  Twelve colleges in Florida are either developing proposals (or are in the process) for $10,000 bachelor’s degree programs. Oklahoma and Oregon are also considering similar proposals, and Southern New Hampshire University has instituted its College for ALL Program, which offers a $10,000 competency-based bachelor’s degree.

We simply cannot afford as a state and as a nation, to allow college costs to continue to rise, thus elevating the opportunity to pursue college as a sign of “luxury” status in our society. ACR220 is designed to jump start this critical conversation that is occurring at countless family tables in New Jersey every night: “How can we make college more affordable?” Offering baccalaureate degree programs that cost no more than $10,000 in tuition and fees will greatly increase the ability of New Jersey students to attend an institution of higher education and acquire the training needed to secure good, high-paying jobs and will significantly reduce their student loan debt. That’s my take. What’s your take?


Showing 3 reactions

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  • commented 2015-05-03 09:17:40 -0400
    Let’s not look at college education as a COST. Rather, it’s an INVESTMENT in the future of our community. A four-year degree at a public institution should not be beyond the means of any qualified student.
  • commented 2015-03-06 13:28:13 -0500
    College is extremely important and needs funding. Some students are not prepared to go to work out of high school because they have not mastered high school level skills. We need to educate these and other students in whatever works best for them in order to prepare them for work. Trade schools should also be considered on a similar level as college. Community colleges are often the schools that pick up the slack where high schools leave off. We need to fund students who are willing to work hard to get an education that leads to future employment, but not those students who are unable to succeed in the learning path they have chosen. Help each student find the right post high school learning situation, help fund them and help place them in an appropriate position after school. Bring back apprenticeships as well.
  • commented 2015-03-05 18:59:47 -0500
    Why are we pushing everyone to go to college. Skilled trades are just as important. The construction industry is crying for skilled labor. Who is going to wire our home, put in our plumbing, fix our HVAC units???? The lack of getting our children that are not college bound into skilled trade schools is just as disgraceful. When I went to school administrators were empowered to say…. “your not college material, you should learn a trade”. Why is that so politically incorrect now?
    Regarding the state of NJ….. a young skilled tradesperson or a young college graduate is not likely to be able to afford to live here. Fix the over taxation of individuals and companies and you will spurt economic growth.
    My exit plan is 3 years then my taxes and my vote goes to another state.