December 02, 2015

"Companies don't care about degrees": As credentials lose their value, state subsidized university makes no sense

Stephen BoucherRebel Blogger
 

After I left school I was inundated with clichés such as “You need a degree to get your foot in the door."

This conventional wisdom is inconsistent with economic realities and alters students’ expectations of life after graduation. University is often considered a safety net, a means of avoiding failure.

However, the advantages of having a degree, particularly in life sciences, humanities and social sciences, are losing their allure. The over-abundance of graduates is not always reflective of market demand, seriously diminishing the unmatched return on investment university is said to provide.

In fact, Canada tops the list of OECD countries for university graduates making less than half the national median income.

I couldn’t justify spending four of the most productive years of my life and thousands of dollars to build a safety net with holes in it, so I left.

Many Westerners must still acknowledge their fetishism of higher education is a problem. If the variety of degrees available to new students reflected the actualities of the job market, that alone would make university a more worthwhile endeavor.

Unfortunately for everyone, university subsidies are politically expedient; the tired platitude of "investing in our nation's youth" doesn't lose its charm come election season.

This was a key aspect of the Liberal platform, which promised to invest $1.3 billion over three years to "create jobs and opportunities for young Canadians."

Most young Canadians would have an easier time getting a job if they chose to expand their skills and knowledge in fields that were actually in demand.

However, this does not coincide with the victim narrative perpetuated by progressives such as our prime minister, to whom personal choice is inconsequential and students must be saved by government from the tentacled clutches of the free market.

University subsidization is a failed government program, and by no means a noble one.

According to Statistics Canada, in 2009 (the latest data available) federal, provincial, and municipal governments shelled out $20,000 per student to universities across Canada. If you could believe it, this has not alleviated the burden on my demographic.

Replacing student loans debt with national debt doesn't solve the problem: money is still extracted from the economy and misallocated, which makes us all that much poorer.

Further, what incentive does this provide for universities to compete and improve the quality of the education at a lower cost when, as the case was at Carleton, they can install a remarkably unimpressive "living wall" that costs $18,000 per year to maintain and still receive cheques from the government?

This is the best time in human history to seek alternatives to traditional institutions (let us recall that at one time the only educated people resided in monasteries). Regretfully, there is greater support among students for cutting tuition fees than there is for seeking alternatives. This emphasizes how ingrained university and government intervention are in Western culture. In a free market, increasing prices are an indicator that one should adjust their decision-making.

One alternative to traditional post-secondary education is Praxis, a South Carolina-based educational program focused on entrepreneurship, self-discipline, and developing tangible skills.

Isaac Morehouse founded Praxis in 2013 because he noticed a growing number of bored students and graduates with debt and no jobs, as well as a growing number of business owners who were always hiring but could never find good talent as degrees became the norm.

According to Morehouse, the main advantage Praxis graduates have is "real world experience with entrepreneurs for a year,” and “Entrepreneurial thinking and the ability and courage to take their life and career in their own hands." 

University is not about enrichment; it's about credentialism. Unfortunately for many degree-holders in bloated majors, the wage gap between high school graduates and university graduates is shrinking.

"It's all about the credentials, which are waning in value and the credential-based mindset is going to be replaced," says Morehouse.

I would much rather show a future employer a unique set of experiences, accomplishments, references and skills than a university degree that renders me identical to hundreds of thousands of other candidates on paper.

"Companies don't care about degrees," Morehouse says, "outside of bureaucracies and those with government-mandated degrees. They care about value creation and it's never been easier to signal to the world your ability."

You can always say, "To hell with you, I'm finishing my degree."

That's fine, but that's not the point. A degree is not inherently worthless, and is necessary in certain fields. That said, taking a year off, creating value for someone, and asking yourself if you really need university to lead a successful life should be the default after high school, not rushing to get a degree.

When it comes to creating value, university sets "a pretty low bar," says Morehouse. "What could you do with four years and tens of thousands [of dollars] that's more valuable? It's limited only to your imagination."

Purists may argue that this is a reckless way of thinking, but considering you’re getting closer to your demise as you read this, a little recklessness may soon find its appeal. Especially when the alternative is striving for mediocrity.

(To learn more about Praxis, check out discoverpraxis.com and also thefutureofschool.com to get a free eBook with Isaac's story and more information about new approaches to education.)

 

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Comments
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commented 2015-12-03 20:07:10 -0500
Well of course there are bad majors out there, such as film studies, english, philosophy, history, or theology. Thee key is to get a good major. It turns out that the bad majors do not represent the majority of the university experience.

If you were stupid enough to major in a bad major, then NOT going to university is not going to save you. Educated or not, you would probably be flipping burgers or selling insurance.
commented 2015-12-03 14:43:21 -0500
@bruce I think you raise a very good point. It’s true, demand for university is high (hence the creation and popularity of fake majors) however the demand for those fake degrees is quite low. Some degrees are indeed useful.

My point is that the ROI for university is decreasing while the cost is going up. Young people should make more informed decisions about their education, rather than rely on the misconception that you need a degree – any degree – to get ahead. In other words, if young people are unsure of what they want to do as a career (many are), they should not default to a university education.

I’m not saying that degrees are inherently worthless or a hindrance in any way. I simply believe that people should re-examine the increasing opportunity costs that come with obtaining a degree, and that the subsidization of university only leaves young people more misguided.
commented 2015-12-03 09:58:42 -0500
REAL university degree’s are worth the time and money spent, such as, doctors, lawyers, tradesmen, etc. As an employer the education section of a resume’ is generally where I start. I look for REAL education degree’s and those resume’s go immediately to the serious consideration pile. Any fake degrees from the ‘humanities or liberal arts’ immediately go to the bottom of the pile. Experience has shown me that the FAKE degree holders are the people that are simply a cancer in the workplace with co-workers and add nothing of value to the organization. I will hire a kid fresh from high school with a good attitude and aptitude any day over a whiny university spoiled brat
commented 2015-12-03 09:23:41 -0500
My degrees (I have a couple) worked out wonderfully, actually. I do something that I love every day. That’s why you go to school. Money was never a consideration, i am frugal and make more than I know what to do with.

Pretty sure the oil workers aren’t that smug. After all, I’m not the one on the verge of losing my job – again a pity, since we’ve done such a poor job of diversification that we can’t handle the inevitable downturns. That’s something else a degree does – gives you alternatives and breadth.
commented 2015-12-03 08:45:34 -0500
ANDREW STEPHENSON you sound bitter did the oil companies turn you down and hurt your feelings. LOL did your degree not work out for you, why all the hatred of oil companies, is it that people who work hard can make as much or more than you with a degree,
commented 2015-12-03 07:51:20 -0500
Interesting theory, but you never cited anything reputable that suggests that you don’t need a degree. Some facts on the matter might help.
commented 2015-12-03 04:21:42 -0500
It is always the drop outs that put down degrees.
commented 2015-12-03 02:31:38 -0500
Andrew sorry they want qualified people not brainwashed idiots who are mollycoddled and demand the world.
commented 2015-12-02 19:22:50 -0500
Say what you will, but we live in a competitive world to the point where people will spend years of their lives and tens of thousands of dollars on the off chance their resume avoids the circular file for just long enough to get read by a human.

We need to talk to the private sector about this. Why is it such an utter, absolute failure at making use of one of the most educated populations in the world? We should be a global leader at pretty much everything … yet here we fail. Instead we can grow a petrofetish and pretend everything is fine for a decade or two, and yet act surprised to find out that the world is leaving us behind.

To aspiring graduates: Go to school. Go to graduate school, if it tickles your fancy. Canada doesn’t value you, but the rest of the world does. Canadian degrees are well respected. Most American employers will jump through hoops to hire you, and many cities are educated, liberal, and prosperous. Leave this useless bitumen-soaked chum bucket of a country behind and never look back. The Rebel is interested in bitumen? Most governments are similarly short-sighted. Acknowledge that and move to a real meritocracy.