Panelists at a Charles Koch Institute event on Wednesday attempted to tackle a fundamental question facing millions of families and students across the country: Is the cost of a traditional four-year diploma worth it?
Their answer? For some, it is. And for others, it probably isn’t.
Some experts say a college degree is more important than ever in a still-stagnant economy that demands higher skills. Bachelor’s degree recipients earn on average 65 percent more over the course of a 40-year career than high school graduates, according to an October report from College Board.
However, students can only accrue those benefits if they actually graduate. Two-fifths of students at institutions that grant four-year degrees fail to graduate in six years.
The costs of not graduating have also risen sharply with total student loan debt surpassing $1 trillion.
Stephen Trachtenberg, president emeritus at George Washington University, said at the event that Americans need to reevaluate what they expect from higher education. Some students will graduate from preeminent public and private institutions like Harvard and generate significant economic value for both themselves and the country, while others might find an equally fulfilling job in a career that only requires a two-year degree.
"Not everybody ought to be going to universities, and not everybody ought to be going to community colleges," he said. "People should decide who they are and what they want to be."
The most concerning thing about students and graduates in the current economy is the "skills gap," said Mike Rowe, founder of Mike Rowe Works, a nonprofit foundation focused on skilled trades.
In a survey last year for the American Society for Training and Development (ASTD), 84 percent of respondents said workers at their organization lacked vital skills, including specialized mechanical and technical abilities and "soft skills" such as communication, creativity, and critical thinking. Many of these employers were in the manufacturing, construction, and health care industries, which require certification for positions but not necessarily a bachelor’s degree.
Companies are reluctant to hire workers for jobs in those fields, numbering more than 3 million, because they lack the necessary skills. That trend is not helped by a society that considers four-year degrees obligatory and anything else to be "alternative" or even beneath them, said Rowe, who became famous for profiling gritty vocations on the show "Dirty Jobs."
"When’s the last time you saw a plumber on TV who didn’t have his work belt on and a yard of butt crack hanging out?" he said.
"The willingness to learn a useful skill and the joy of working hard—these two things have been under attack for a long time in a variety of ways," he added.
Bob Morse, director of data research at U.S. News and World Report, pushed back a bit against Rowe’s focus on skilled trades, noting that there is also a high-skills gap in Science, Technology, Engineering, and Math (STEM) fields.
Still, many of the skills required for STEM jobs can also be obtained from specialized two-year programs, said Beth Akers, fellow at the Brookings Institution’s Brown Center on Education Policy. More transparency about costs and returns in two-year vs. four-year degree programs would help parents and students making that decision, she added.
Tuition and fee increases of more than 1,000 percent in the past 35 years, outpacing the inflation of both food and health care prices, have increasingly strained the finances of middle-class families. Billions in government financial aid have been disbursed to help defray those costs, which some experts say has only further inflated them.
Richard Vedder, economics professor at Ohio University and director of the Center for College Affordability and Productivity, said the opacity of college costs and shrinking state budgets make higher education ripe for "disruptive innovation."
Vedder said in an interview with the Washington Free Beacon after the event that proposals like Sen. Mike Lee’s (R., Utah) plan to decentralize accreditation of higher education programs could remove barriers to innovation in a system that often only benefits incumbent institutions.
"The [accreditation] system reeks," he said.
Reforming the accreditation system could pave the way for lower-cost and targeted instruction, such as $10,000 degree programs that combine online and campus-based learning.
"We need to reform that whole system," he said.