by Mark Keys
Motives for education can be fundamentally broken down into students taking an initial investment in hopes of high returns in the future. College students forego working now, and instead pay to educate themselves at traditional universities. This initial cost for investment has historically proven worthwhile to college graduates. According to the U.S. Census Bureau, those with a bachelor degree will earn $900,000 more than a high school graduate on average over the course of a lifetime (the gap widens to $1.3 million for a master’s degree).
However recent data according to the EPI (Economic Policy Institute) shows that college graduate wages are decreasing. College graduates, adjusting for inflation, are making less and less. Perhaps the flood of college students saturated the market or maybe CEOs netting 100 million per year have concentrated the wealth. One thing is for certain, potential college students today must seriously consider their college investment. Changing gears into distance education with an online degree is turning heads and gaining steam in this wallet-clenching recession.
Our college student who has calculated his risk and return has thus far experienced a decreasing return on his investment. But the problems don’t stop there. Studies also show tuition is consistently rising every year by a few percent. This amounts to a large debt graduates are facing; a tsunami of student loans that many will pay into their 40’s--Students who want to get a master’s, or become a doctor or lawyer?-- Good luck. To conclude the current state of education; students are getting less payoff for their investment, and their investment is becoming drastically more expensive.
While not particularly flattering, this is the state of affairs in the US economy and the current recession only makes outcomes worse. However potential students have one US quality to thank: Capitalism. Entrepreneurs over the last decade have trickled into the education domain. Drip by drip online schools have landed across the US and educated globally. Capitalism and competitive markets have found a way to beat the current economic rates of education. Online schools drastically cheapen a degree. Students now can achieve an online college degree without the inflated price tag, making their initial investment less on their risk versus reward calculation.
Online schools have drastically cut costs and passed the savings on to students. Money pits like campuses, dorm living, and athletics are all cut. Online schools have philosophically changed education. Education is now the lone pillar for schooling success, the rest is secondary. At one point online degrees were shunned by employers based on questionable candidate quality. The remarkable part is now many highly respected traditional schools are switching their agenda’s to include online classes. The lines separating traditional and online education are beginning to blur. Students can remain more confident today that their online degree will signal a similarly qualified candidate as a traditional degree—perhaps in the future it will even signal a more economical employee!
Mark Keys has a degree in economics and has been writing about financial and economic issues for years. Mark’s senior thesis was in fact on the battle between nonprofits and for-profits in traditional education.
Motives for education can be fundamentally broken down into students taking an initial investment in hopes of high returns in the future. College students forego working now, and instead pay to educate themselves at traditional universities. This initial cost for investment has historically proven worthwhile to college graduates. According to the U.S. Census Bureau, those with a bachelor degree will earn $900,000 more than a high school graduate on average over the course of a lifetime (the gap widens to $1.3 million for a master’s degree).
However recent data according to the EPI (Economic Policy Institute) shows that college graduate wages are decreasing. College graduates, adjusting for inflation, are making less and less. Perhaps the flood of college students saturated the market or maybe CEOs netting 100 million per year have concentrated the wealth. One thing is for certain, potential college students today must seriously consider their college investment. Changing gears into distance education with an online degree is turning heads and gaining steam in this wallet-clenching recession.
Our college student who has calculated his risk and return has thus far experienced a decreasing return on his investment. But the problems don’t stop there. Studies also show tuition is consistently rising every year by a few percent. This amounts to a large debt graduates are facing; a tsunami of student loans that many will pay into their 40’s--Students who want to get a master’s, or become a doctor or lawyer?-- Good luck. To conclude the current state of education; students are getting less payoff for their investment, and their investment is becoming drastically more expensive.
While not particularly flattering, this is the state of affairs in the US economy and the current recession only makes outcomes worse. However potential students have one US quality to thank: Capitalism. Entrepreneurs over the last decade have trickled into the education domain. Drip by drip online schools have landed across the US and educated globally. Capitalism and competitive markets have found a way to beat the current economic rates of education. Online schools drastically cheapen a degree. Students now can achieve an online college degree without the inflated price tag, making their initial investment less on their risk versus reward calculation.
Online schools have drastically cut costs and passed the savings on to students. Money pits like campuses, dorm living, and athletics are all cut. Online schools have philosophically changed education. Education is now the lone pillar for schooling success, the rest is secondary. At one point online degrees were shunned by employers based on questionable candidate quality. The remarkable part is now many highly respected traditional schools are switching their agenda’s to include online classes. The lines separating traditional and online education are beginning to blur. Students can remain more confident today that their online degree will signal a similarly qualified candidate as a traditional degree—perhaps in the future it will even signal a more economical employee!
Mark Keys has a degree in economics and has been writing about financial and economic issues for years. Mark’s senior thesis was in fact on the battle between nonprofits and for-profits in traditional education.
