It was fun while it lasted but we’re going to call it, folks. The anti-college movement is dead.
Say what you will about rising tuition, student loan bubbles and the merits of early entrepreneurship but, as with global warming and human evolution, you simply can’t ignore the facts.
This report by the Pew Research Center sealed the deal for us. Based on a study of more than 2,000 millennials ages 25-32, along with decades worth of Census data, researchers found young college graduates are out-earning and outperforming their peers on nearly every front.
“Not necessarily everything is rosy for the typical young college graduate but, when you ask them about their college experiences, they’re fairly positive overall,” Rick Fry, senior researcher for Pew, who co-authored the report, told Yahoo Finance.
Just in case you weren’t convinced, here are a few signs a college degree is still worth your money.
College graduates are more likely to find jobs and stay out of poverty — plain and simple.
Young people with college degrees today are far less likely to wind up unemployed (3.8%) than high school graduates (12.2%), according to Pew. In fact, high school diplomas are worth less today in the job market than they were four decades ago. When compared to earlier generations, unemployment rates are nearly three times as high for high school graduates today as they were for high school grads in the 1960s.
“[The study] really does suggest that the opportunities for people who end their education at high school … have been strongly constricted to what they were 30 or 40 years ago,” Fry says. “There’s just not that many good opportunities today.”
With job insecurity comes financial insecurity for high school grads. Census data show that, among millennials ages 25 to 32, more than 20% with only a high school diploma are living in poverty today, compared with 6% of college-educated young adults. Of course, these data are for the typical college graduate. Area of study still matters a lot when it comes to earning power. An engineer will most likely always earn more out of college than a liberal arts major, for example.
A high school diploma has never been worth less.
Everyone pays so much attention to assigning value to college degrees, but the real focus should be on the dramatic decline in the value of a high school education.
“While earnings of those with a college degree rose, the typical high school graduate’s earnings fell by more than $3,000, from $31,384 in 1965 [in 2012 dollars] to $28,000 in 2013,” according to the report. “This decline, the Pew Research analysis found, has been large enough to nearly offset the gains of college graduates.”
The reality is that today’s job market simply isn’t as bountiful for high school graduates as it was three or four decades ago. Blue collar manufacturing jobs were once the bread and butter of uneducated workers and yet those industries are rapidly disappearing (at least in the U.S.).
In the report, nearly 90% of young college graduates said they think of their current job as a career, compared to just 57% of high school graduates.
The pay gap between high school graduates and college graduates has never been higher.
Probably the most compelling argument in favor of a college degree is also the most obvious — those with a degree simply earn more, dollar for dollar, than high school graduates.
But today, the pay gap between high school and college graduates has never been wider.
According to Pew, in 1965, young college graduates earned $7,500 more than those with a high school diploma. By 2012, that gap had more than doubled to $17,500.
“Two things have happened to explain this gap,” Fry says. “College educated workers have gotten paid more and … the value of a high school degree has really been hammered.”
If it’s dead (or at least dying) what’s keeping the anti-college debate alive?
So long as the majority of employers value college education, there is no way anti-college activists can win this debate.
“Employers see something in these college graduates, something that they want,” says Fry. “We’ve got more college graduates than ever today but the pay, what employers are willing to pay them, has been rising over time.”
But that's not to say proponents of alternative education models aren't racking up small victories of their own these days. College dropouts are a ubiquitous presence on lists of (exceedingly rare) billionaire entrepreneurs — including Steve Jobs, Mark Zuckerberg, Tumblr founder David Karp and Whole Foods founder John Mackey.
Dale Stevens, 22, founder of UnCollege.org, has mastered the "unschooled" approach to learning. He dropped out of college in Conway, Ark., shortly after enrolling, disenchanted with the lecture- and schedule-driven environment.
“The question I ask is, if so much of the experience of going to college is being in a semi-structured environment in a community of people where you’re pushed to do things that are challenging, why not just buy every 18-year-old a one-way ticket to India for a couple years?” he says. “That seems like a much cheaper way to solve that problem.”
Stevens is one of only a few dozen young people to so far earn the coveted Thiel fellowship, launched in 2011 by Peter Thiel, Facebook (FB) investor and co-founder of PayPal, and Elon Musk, currently CEO of Tesla (TSLA) and SpaceX. As a Thiel fellow, Stevens was granted $100,000 and the chance to skip college in order to pursue his own business venture. The premise for the program is that young people can be just as successful — and sometimes even more so — without a college degree. So far Thiel fellows have created everything from sprayable caffeine to Spot, a car service that works like AirBnB.
"I don't want to sound like we’re dogmatically against college — it’s this amazing thing that civilization has constructed," says Jonathan Cain, president of the Thiel Foundation. "But what we do take issue with is treating it as if we just send more people to college, somehow we’ll end up creating jobs and improving our economy and getting back on track."
Stevens has taken a page from Thiel's book and created his own program for high school graduates looking for an alternative to college education. For $14,000 a year, he offers them housing and classes in public speaking, business management, negotiating, and writing professional e-mails. A $2,000 chunk of tuition goes toward funding an international trip the student can plan on their own, and a rotating roster of successful entrepreneurs act as mentors.
Says Stevens, "We try and work on teaching the kinds of skills you’re supposed to learn but no one teaches you [in college]."
At the end of the day, the student alone will pick his or her own path to success — whether that means frat parties and finals or taking their talent off the beaten path. But the numbers aren't lying and, at this point, having a college degree seems to be the winning option for the majority of Americans.
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