Monday, December 29, 2008

What is a Degree Worth--part #1

The following comment appeared in the comments on an Orthonomics posting a while back:

"Let's keep in mind that today a B.A. is totally worthless. IMHO it is great that these girls can speedily finish their B.A.'s and get on to their Masters."

So a B.A is totally worthless? Just what does "worthless" mean, or its opposite "worth"? One definition for these words is money-based; worthless has no monetary value and worth means that something has monetary value. So what is a B.A. worth in terms of money?

"In 2005, median earnings for full-time workers with a bachelor’s degree between the ages of 25 and 34 were $13,900 more than the median earnings of full-time workers with only a high-school diploma. The difference in the 45 to 54 age group was $22,900. Those with higher degrees (master’s, doctorate and so on) earn between $8,800 more than those with a bachelor’s degree for the age group 25-34 and $11,600 for those ages 35 to 44.
According to U.S. Census Bureau data, the average full-time year-round worker with a four-year college degree earned $54,689 in 2005; compare that with the $29,448 a worker with only a high-school diploma earned.


Over their working lives, as calculated by the College Board, this income gap means that typical college graduates can expect to earn about 73% more than typical high-school graduates. Likewise, those with advanced degrees can expect to earn two to three times as much." (http://planit.cuna.org/013178/article.php?doc_id=25)

A different source had this to say: " How much is higher education worth in cold hard money? A college masters degree is worth $1.3 million more in lifetime earnings than a high school diploma, according to a recent report from the Commerce Department's Census Bureau.
The report titled "The Big Payoff: Educational Attainment and Synthetic Estimates of Work-Life Earnings" (.pdf) reveals that over an adult's working life, high school graduates can expect, on average, to earn $1.2 million; those with a bachelor's degree, $2.1 million; and people with a master's degree, $2.5 million. Persons with doctoral degrees earn an average of $3.4 million during their working life, while those with professional degrees do best at $4.4 million. [The figures are based on 1999 earnings projected over a typical work life, defined as the period from ages 25 through 64.]


Based on the information above (and other sites I went to basically all said the same thing), a B.A. is not a worthless degree, certainly not as far as money is concerned. How much that degree is worth can depend on the area majored in; some professions pay higher salaries than others do. And how much that degree is worth can also depend on where the degree comes from. It's a fact of life that degrees from some colleges and universities bring with them higher starting salaries (and better job opportunities), thus higher lifetime earnings, than are given to graduates of other colleges and universities.

And while those with an M.A. will earn more over a lifetime, that estimate of earnings has a wide range. A lot depends on what that M.A. or M.S. is in. It depends on whether or not the degree holder is working full time or part time. And yes, it depends on from where the degree holder got the degree.

So no, a B.A. is not worthless if we are using money as the standard of judgement. And given that the estimate of the number of people in the country with graduate degrees of all types is about 9.4% of the population, then the B.A. (at about 54% of the population) is valuable to far more people.








25 comments:

SephardiLady said...

I disagreed at that time with the comment and still do.

Speeding through a degree without taking away the skills that one needs (strong research and written composition skills come to mind) will render a degree worthless, even if one manages to secure a M.A.

I don't care for the short cut method that is being promoted in some frum circles. And, neither do many employers who find that their employees can't function at the level needed.

The advice I will be giving to my children is to take each degree seriously and to seek out internships and other resume and skill building activities. But what do I know, I only have a B.A.

G said...

Assuming the person does in fact go on to earn a masters degree there is probably alot of truth to that statement.

mlevin said...

I think degrees per sey are worthless, it's the knowledge that has value. In the old days that piece of paper represented a certain level of knowledge that person in question aquired, but today it doesn't mean anything. (By today, I do not mean 2008, I mean any time after 1950s)

Here's an example, my high school classmate was accepted into NYU in 1986 with full scholarship and a stipend. Sounds impressive. Right? Well, behind the scenes this is what happened. Her family had a business and were able to cheat on income tax. According to their tax return, they were making $7,000 a year (family of four). That was below poverty level even in 1986. NYU, in its wisdome has a program for mediocre poor students. Excuse? They are mediocre students because they are living in poverty and can't concentrate on their school work. Her high school average was in very low 80s and her SAT score was under 800. In addition to getting free college education, those in the program also received special "help" choosing classes,... All of their classes were easy As. They ended up with an impressive NYU degree without any knowledge to back it up.

Since then I heard similar stories and spoke to numerous college grads who knew absolutely nothing about anything. Their degrees are worthless.

ProfK said...

SL, agreed that what you learn in a regular college program is invaluable for the future.

G, unless that masters is from a diploma mill you aren't going to get into that masters program without the bachelors. Legitimate graduate programs can pick and choose who they will admit and yes, they give preferential treatment to those from "traditional" college programs and from recognized, certified college programs.

Mlevin, there have always been people who got college diplomas and yes, from some "fine" schools, who were not representative of the caliber of the school. Personally, our present President can hardly be said to be a prime example of a Yale education.
Obviously the value lies in what is learned, not just the piece of paper. But don't discount that piece of paper. The posting deals with the financial value of a college degree.

We'll have to agree to disagree about the worth of that paper's having gone down since after the 50s. In my opinion, the problem with some institutions of higher learning began in the 70s-80s when government attempted to make college education fully egalitarian.

Lon said...

mlevin does have a legitimate point, though. Because a degree is worthless if you don't deserve it. I cringe whenever I hear about another barely-got-a-high-school-diploma student taking out student loans to get a masters degree.
Do you think (s)he's going to get a job that will pay off those loans? Hint: answer starts with "N".

If a bachelors isn't worth much, it's because we have a system that allows people with an IQ of 90 to get advanced degrees.

ProfK said...

Lon,
I was so trying to be PC and not state the obvious (or at least what I think is obvious) but now that you and Mlevin raised the issue, let me concur with you. College is not for everyone, regardless of how agencies and government are trying to make it be. There are simply those who do not have what it takes to make it through a regular college program and come out with the level of education necessary. You can't legislate intellect. That we tout college for everyone can lead to a devaluation of a college degree, except perhaps from certain institutions.

I once brought up this point in an educational setting and got my head handed to me. Someone shot back at me that where would I have been if CUNY did not have open enrollment for anyone with a high school degree or equivalent. Frankly, I still would have been in CUNY. In the olden days CUNY required SATs above a certain level and also a grade point average above a certain level. As a grad student I taught the first class of open enrollment students that came into CUNY--it's been downhill ever since. Sure, there are a few students who didn't do well in high school that do fine in college, but there is a whole slew who barely scrape by. CUNY's academic reputation was so not helped by open enrollment.

Rae said...

Sure, the degree translates to more money earned over a lifetime. But if we continue to lower standards so that the degree becomes just another piece of paper then that degree will start to be worth less money in salary than at present. And yes, lots of people who are getting those college degrees who are really not very well educated.
Back when I was in college people used to talk about a Gentleman's C. That was given to students who weren't all that bright but whose daddies gave money to the school. Today that grade has been inflated to a Gentleman's B. Maybe we need to go back to the idea of earning a high grade instead of having it given to you just for showing up and breathing or the amount of money your family has.

Bas~Melech said...

Did anybody mention yet that it depends on what field you're in? For instance, a computer programmer can do very nicely with a BS degree, but a psychology major can't do anything with the degree until s/he gets more professional credentials.

That said, I have no compunctions about looking down my nose at people who shortcut their way through college because it "isn't worth anything." I learned a lot in college, not the least of which was a good work ethic and research skills. Plus, do you think there might be a reason why you can only go for a master's after completing a bachelor's degree? Hmmm...

G said...

G, unless that masters is from a diploma mill you aren't going to get into that masters program without the bachelors. Legitimate graduate programs can pick and choose who they will admit and yes, they give preferential treatment to those from "traditional" college programs and from recognized, certified college programs.

Who said anything about not earning a Bachelors from ana ccredited institution? The quote mentions speedily finishing it, nothing about not getting it.

As for getting into a graduate program: that depends alot on the field. Even if, my experience leads me to believe that it will only keep you out of the most exclusive of programs and even that can be overcome with high enough exam scores.

ProfK said...

G,
I'm making an assumption that you attended a regular college program. By that I mean one that did not offer you a BA after one year. There are programs that will promise you a BA and an MA in one to two years total--see part #2 of this posting on Wed. I've been in a hiring position and I would not look at a graduate of a diploma mill. It was not the piece of paper that I found valuable in potential employees: it was the knowledge that is supposed to go with that piece of paper. Show me a BA in one year and I'll show you a person I'm not going to hire.

G said...

So even if someone has graduated from a standard graduate program with an otherwise hireable record - you will dimiss based on their undergrad degree?...even if said graduate program saw them fit...even if the personal impression is one you find w/o fault...you will hold to a higher standard bec of their BA status?

Lion of Zion said...

SL:

"I don't care for the short cut method that is being promoted in some frum circles. And, neither do many employers who find that their employees can't function at the level needed."

i agree with you in principle, but if this were really true then there should be a trickle down effect that results in people not enrolling in these programs (which hasn't happened)

Dave said...

Continued demand is no proof of anything. The world is full of diploma mills (or just substandard educational facilities) that have made their money promising a "valuable" education that they don't deliver; and they have no shortage of new applicants. They are selling a product, and all they need to do is market it to people who think they need it.

College gets you at most three things. It gets you the opportunity to learn, a credential, and the opportunity (perhaps) to network in your chosen field.

The quality of the school sets an upper bound on the education, and the reputation of the school determines the value of the credential. Not all credentials are equal, and credentials that are valuable in some circles are useless in others.

Networking depends on the school, its reputation in that field, and its ties to the professional or academic community in a given field.

That's pretty much it.

Because this is more and more a credentialed society, many people try to get a quickie credential -- cheapest fastest way they can. They will in some cases actively work to skip the whole learning part of the behavior, if they can just get the magic credential.

Of course, as this happens, the credential loses value -- reputation is almost invariably a trailing indicator.

Bas~Melech said...

I think graduates of the 1-year degree programs are getting jobs, and I think they wouldn't be doing quite so well if that weren't the case. I am thinking of one program in particular. Its graduates would probably not get into to the same graduate school as me, but they're probably not interested either because they can get their masters in another year from the same school. They may not have as many employment opportunities as me, but there are apparently enough jobs of the type they're looking for. Also, it's who you know, not just what you know. The people I know who went that route seem to be doing just fine.

Jay said...

It's like with any knockoff of a better product. They both look shiny coming out of the box. But give it a little time. One tarnishes and falls apart when you try to use it. The other remains solid. But some people will always buy from that guy on the corner who says I have a watch to sell you while others will only buy from reputable jewelers.

ProfK said...

G,
It's an employer's market out there, not an employee's market. When I get in a few candidates for a job who are all presenting the same type of credentials, I need some basis to order them, and where they went to school, including undergrad work, and for how long is part of that. Depth and breadth of knowledge and exposure are part of the hiring equation.

There is also why someone would choose to go the diploma mill route for undergrad work. I ask. And mostly the answers don't please me as a prospective employer. I have to ask myself if those who shortcut their way through an education are not also going to shortcut their way through the work I will give them to do. If they don't think the "small details" are important then I don't want them working for me.

Lon said...

In your field, Bas~Melech, dynamics are slightly different because it's a huge state-sponsored field. But private-industry credentials from diploma-mills are worth far less because of the lack of networking these schools can afford their students. There's a reason why, say, Harvard business school grads go work for Fortune500 companies. Not because they're necessarily smarter, but because they're in a respectable institution with a reputation and a highly developed career services office. A low-end degree in business or law is almost worthless in terms of high-flying career potential.

Lion of Zion said...
This comment has been removed by the author.
Lion of Zion said...

LON and BAS MELECH:

"dynamics are slightly different because it's a huge state-sponsored field"

i will assume this is a reference to the lucrative therapies (in particular EI)?

if so, i truly believe that this entire field is destined for a great crash (this was one reason i stayed away from it when i went back to school). we'll see who survives and gets the few jobs that will remain after the state programs are revamped. i'm sure credentials will matter then once again.

(worse yet, we'll see an unimaginable economic crisis in the frum community like no one can imagine.)

ProfK said...

Lion,
I believe Bas~Melech is in the field of education. But re your therapy comments, I think you are correct that a crash is coming. It's a simple matter of supply and demand. When you oversaturate an area with one particular type of product, in this case therapists, but the demand has not kept pace with the supply, then you are going to have a lot of people who aren't going to be able to find jobs. Also, competition among so many people is going to drive down prices. Diversification in college majors among our young women, and men too for that matter, is desperately needed.

ProfK said...

Just a little note about that diversification. Two of my male students are entering nursing programs this January. They will get their BS at the end of this term. When they finish they will be nurse specialists. Good for them! They are going where there is a great need and where demand is far greater than the supply. Nursing shortages are accute.

Lion of Zion said...

PROFK

re. the therapies, the supply and demand issue will result in a painful correction.
the devastating crash on the other hand will be the result of city/state cutbacks* to reign in the budget as well as issues that involve והמבין יבין

* there is already more board of ed oversight and resistance, as anyone who has had their child evaluated recently knows. also, the board of ed (which employs a lot of frum girls and some guys directly in the public schools) is more careful now with allocating its caseloads.

nursing is a good field if you go on to become a nurse practitioner. although i still don't understand the difference between a nurse practitioner and a PA (aside for some very minor legal distinctions in terms of prescribing priviliges.)

(word verification: typ it)

tesyaa said...

I have heard that demand is down for private therapy.

When the state of NJ started charging a copayment (based on household income and family size) for early intervention a few years ago, there was a drop in demand also.

I just hope that the children who really need help will continue to be served properly in the public schools.

Lion of Zion said...

TESYAA:

aside from any copayment, it is *much* more difficult to get approval for services in NJ (or at least in teaneck; i don't know if it's different elsewhere). and approval is often generally for fewer hours than in NY. i have a friend who moved to long island rather than NJ because their son needs a lot of services.

its also a reason i didn't go into the therapies. they can be good if you live in new york, but it's not a very portable profession.

tesyaa said...

LoZ, we did very little EI when we lived in NY. We used it a fair amount in NJ, and I agree, it was not easy to get as much as was needed. However, the public school in my community has been phenomenal, much better than the district I dealt with in NY. We have gotten evaluations and services we didn't even ask for, and we have been treated very respectfully. And I live in a working class district, not a wealthy one. Depending on the kids' needs, I would make the somewhat cynical cheshbon that school lasts for many years, while EI only goes up to age 3 (approximately), so the school services may be more worthwhile in the long run. (I realize that for a severely ill infant, getting as much EI as possible is a necessity).