A college degree was once seen as a magic ticket into the middle class. But in recent years doubts have set in. The ticket keeps getting pricier and it doesn’t seem to be taking us as far as it used to – a scenic trip to prosperity seems less assured than in decades past.
Student debt is $1.5 trillion, increases in tuition are outpacing wage increases, and one-third of college graduates spend the bulk of their careers in occupations that don’t require a bachelor’s degree.
According to LiveCareer’s 2018 Job-Hopping Report, jobseekers in many fields highlight degrees and certifications on their resumes at much higher rates than those credentials are listed in job ads. For example, one-quarter of jobseekers list an associate’s degree when applying for jobs that do not require them.
But is the economic promise of higher education really a thing of the past? The answer requires more questions.
- Does a college degree pay for itself?
Economists have traditionally answered this question in the affirmative, and then some, by calculating the “graduate premium” – a college graduate’s increased earnings over a lifetime after subtracting “educational investment.” This investment includes tuition and fees plus lost income for time in school. The graduate premium peaked in 2000 at 15 percent.
A recent article noted that as the number of young people with degrees increased – in the U.S. 48 percent of 25- to 34-year-olds hold college diplomas – and the amount of money spent on higher education has surged, the graduate premium has flattened.
However, researchers at the Federal Reserve Bank of New York argue that a college education is still worthwhile. Wages may be falling, but they are falling for all wage earners, and the gap between college-educated workers and those without a degree persists remains at the 15-percent mark.
- Are some degrees worth more than others?
Degrees in STEM fields like engineering and nursing can pay large dividends over your working life, but the graduate premium differs across fields of study. For example, students studying hospitality, agriculture, architecture, and liberal arts experience a much narrower gap with non-degree holders.
LiveCareer’s analysis found that 24 percent of applicants for blue-collar jobs listed associate degrees, and 17.5 percent listed bachelor’s degrees, for jobs that did not require these levels of education in their ads. Applicants often listed higher education when none was explicitly asked for by employers looking to fill white-collar jobs as well. This data suggests that Millennials and Gen Zers are over-investing in education to prepare for fields where expensive credentialing may not be needed.
But calculating return on investment for education can get tricky. It turns out that some employers are more likely to hire college graduates – and pay a premium for them – even for jobs that do not require a college degree. In addition, the lifelong earnings of graduates with non-STEM degrees tend to catch up with their peers as they progress in their careers.
- Does college teach the right skills?
Despite the record number of college-educated jobseekers in the labor market, Harvard Business Review reports that some employers say they are experiencing difficulty finding candidates with the up-to-date technical skills. Resumes that emphasize specific skills and platform knowledge, rather than educational attainment may give younger jobseekers an advantage.
Four-year degrees aren’t the only kind of education that the 2018 Job-Hopping Report indicates might be overrated by jobseekers. Applicants looking for jobs as administrative assistants, bartenders, cashiers, customer service representatives, sales associates, software developers, and store managers often list certifications and licenses when none are specified in job ads.
This may indicate that jobseekers should be wary of expensive licensing and certification courses. At the same time, job postings for accountants, teachers, and caregivers often required certifications more often than applicants listed them. The best approach may be to build a resume that’s tailored to note technical knowledge, training, experience, and competencies that are cited in individual job ads.
- Is there a risk to trying college?
41 percent of students who begin college do not graduate in four years. Those entering with the lowest high school grades are much more likely to leave with no degree to show for their investment of time and money. For these students, college can be a costly detour.
Starting college but not finishing might even disadvantage you in the job market because it can lead to negative assumptions and uncomfortable questions about why you were unable to finish during job interviews.
- So, is a college degree still worth the investment?
The truth is many employers want a college degree and specialized skills that are seldom taught in college settings. The best hedge is to pursue classroom knowledge and workplace experience simultaneously through internships and part-time employment while keeping an eye out for reasonably priced, up-to-date technical training courses in your discipline.
And, because the data seems to indicate that employers value completed degrees, even for jobs that don’t require them, it makes sense to include educational attainment on your resume even as you highlight skills over credentials.
Access additional findings on education (and how it plays into job hopping), plus a free PDF download of the full LiveCareer study, via this link: 2018 Job-Hopping Report.