50% of recent college grads feel underqualified to enter the workforce: RPT
Michael Hansen, Cengage CEO, joins Yahoo Finance Live to discuss the new survey on recent college graduates prospects entering the workforce.
Video Transcript
KRISTIN MYERS: Welcome back. Well, there's new results from a survey on the employability of recent college graduates. And the results are just a little bit depressing. According to the results from Cengage-- listen to this-- more than half of graduates say that they will not apply to entry level jobs because they do not feel that they have the skills.
We're joined now by Michael Hanson, CEO of Cengage. So Michael, we just had those numbers up on the screen. I'm curious to know if the reason so many of these college graduates don't want to apply to these entry level jobs is a problem with the education that they received in college, or is it really a problem with the employers, who make them feel that they're not qualified for some of these positions?
MICHAEL HANSEN: Alexis, thanks for having me. And I think the answer is, it's on both sides. First of all, the education system is not preparing the students with significant real life experiences and skills. And that leads them to feel inadequate when they apply for a job. In other words, the education system is basically looking for people to be degree ready, but not to be job ready. And on the other hand, as you pointed out, I think there is an overemphasis and almost a stigma on the part of employers that for every conceivable job, you need to have a degree. So I think both the education system and the employers need to change.
ALEXIS CHRISTOFOROUS: OK, so having said that, that's a lot of ground to cover and a lot of, I think, changes that need to be made. Let's start with employers because that's sort of our focus here at Yahoo Finance. What can they do to start to bring in more people at all different kinds of levels and those who might not have enough work experience to be brought on to their organization in a big way?
MICHAEL HANSEN: Yeah, absolutely, Kristin. And let's start with a hard fact. 65% of the open jobs today require a college or an associate degree. And we did it. We are a large employer. We employ 4,500 people. We went through this and said, which of these jobs truly require a degree, or where, often, we just basically doing it because we've always done it? And we found that you can actually weed out a lot of those requirements and open the jobs up for people who might not have a degree, but they might have a certificate, they might have a certain skill, they might have real life experiences that eminently qualify them. So that is a very simple step that every employer can take. And thankfully, employers are starting to do just that.
KRISTIN MYERS: Michael, it's Kristin here. I actually think you got me and Alexis mixed up.
MICHAEL HANSEN: I'm sorry.
KRISTIN MYERS: I don't know, too-- no, don't worry about it. Alexis is a wonderful co-host, so I'm happy to be confused for her any day of the week. But I do want to ask--
MICHAEL HANSEN: And they're both beautiful names, so.
[LAUGHTER]
KRISTIN MYERS: I do want to ask you, though. Speaking on that point, is a college degree really as valuable as folks try to make it seem? I think so many people talk about how we have to have a college degree. But as you're mentioning, so many of these jobs could be opened up to folks even without a degree, but just perhaps with a certificate. So should we really stop deemphasizing the need for a college education?
MICHAEL HANSEN: Yeah, I would say it is a question of, for which job and for which career is a college degree really a good return on investment? And there are a number of jobs out there where that is clearly the answer to that is clearly yes. But there is a large number of jobs where a college degree is not a good return on the investment. Where you got to say, the average college degree costs about $30,000, and that's the average. For some, it's even a lot more than that. And the question really is, does that give me the skill set that's required for the career that I'm excited about, that I want to embark on, and I can continue to learn in that career as well. So it is the right course for the right course, so to speak, to answer your question.
ALEXIS CHRISTOFOROUS: Are there particular kinds of jobs or sectors that would lend themselves to perhaps not having a four-year degree or not having a degree at all that could still prove to be good long-term career choices for folks?
MICHAEL HANSEN: Absolutely. Absolutely, Alexis. And the two big areas are health care, number one, and the other area is works and jobs in IT. And we see a significant amount of increase in application to our business that gives those certificates. It's called ed2go. And that business has seen a 50% increase in demand in particularly those two sectors, where people are saying, you know what? For $2,500, I can get a certificate that allows me to become, for instance, a medical coder and actually have a very good income and very good return on that investment. And guess what? It's going to take me four months, as opposed to two years or four years.
KRISTIN MYERS: Where do internships really fit into this whole equation? I hear you talking about those certificate courses, obviously, college degrees. But what about internships? Should those that are in college really try to boost some of their skills by getting internships in order to apply for some of those jobs?
MICHAEL HANSEN: Absolutely, yes. And I would go even a step further. I think what we need to do and what is thankfully starting to happen is, we need to mesh together the employer world with the education world. And I think it is happening right now primarily with community colleges in local areas, where students can be in a course in the education system, but at the same time, work in a company, do an internship at the company, and really figure out what it takes that I'm learning here theoretically in the school and in the college. How does it apply to the real world?
And that meshing of the job skill requirements and the curriculum in individual colleges, that is what needs to happen. Thankfully, it's happening on the ground. It's happening here in New York. It's happening in other communities around the country. But this is the way forward, no doubt.
KRISTIN MYERS: All right, Michael Hansen, CEO of Cengage, thanks so much for joining us with those insights.
