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Don’t Want Student Debt? Pick a Different Major.
People frequently question a student's choice of major in discussions about the student debt crisis. I commonly see comments like “don’t take out student loans for a degree in underwater basket weaving,” when perusing articles' comment sections. There are inherent inequities when comparing college majors, including differences in expected salaries and employment rates. Additionally, the salary potential and employability of specific degrees make them easier to repay student debt. However, are Millennials really any more "impractical" than any other generation in their choice of studies? And more importantly, is it a good idea to choose your major based on the current marketplace demand and salary for a degree?
Millennials May Be More “Practical” than Your Generation
Though Millennials take the brunt of this criticism since we consist the current college-aged and young adult population, statistics paint a different story. I plotted NCES (National Center for Educational Statistics) data on the distribution of degrees conferred by postsecondary institutions over the course of 40 years. The most dramatic changes you notice are the staggering increase in students with degrees in Other Fields and the plummet of Education degrees. Traditionally "impractical fields" (Humanities & Social Sciences) are equally or less popular than they were in the early 1970s. While degrees in Business and Computer Science & Engineering are less popular than they were in the 80s and early 90s, they have increased since the 1970s. Our interests and career goals aren't any less practical or more outlandish than those of generations who came before us—there are more of us getting degrees (more than double those awarded 40 years ago). Because of this, we are not being absorbed into the job market as easily and in the same way earlier generations were.
Click here to see the data in table form.
*Other Fields include "Agriculture and natural resources; Architecture and related services; Communication, journalism, and related programs; Communications technologies; Family and consumer sciences/human sciences; Health professions and related programs; Homeland security, law enforcement, and firefighting; Legal professions and studies; Library science; Military technologies and applied sciences; Parks, recreation, leisure, and fitness studies; Precision production; Public administration and social services; Transportation and materials moving; and Not classified by field of study."
Should the Marketplace Dictate Students' Majors?
Your view on this topic largely boils down to your educational philosophy—whether you’re in the “Follow Your Heart” camp or “Show Me the Money” camp. Do you think a liberal arts education or one focused on a student's chosen discipline is better? I believe college students should educate themselves on the potential pitfalls of their desired career (the projected growth of the industry or discipline, the anticipated salary, saturation of talent, and the barriers and timeline for advancement). One major drawback of many careers is the size of student loan payments in comparison to each month's paycheck. However, choosing a major based on current in-demand fields is also flawed. Positions that are readily available and pay well now may very well become a saturated or nonexistent industry by the time new college grads retire 45 or 50 years after graduation. You've heard Confucius's quote, "Choose a job you love, and you will never have to work a day in your life". As the hours in a workweek continue to grow and the age of retirement rises, choose a job you don't love, and it may seem like you're working every day for the rest of your life.
by: Paige Witthar
Read almost any news publication for a few weeks and you’re bound to come across an article related to the student debt crisis; read it online, and you’ll find comments just as discouraging as the information relayed in the original article. Sometimes I find myself speeding to these opinion mines to see what people more removed from the situation than I—a 22-year-old, recent college grad who blogs about this stuff—have to say about student debt. What do I find? Blanket solutions and disparaging of millennials. I don’t place blame on one institution for the student debt crisis and therefore don’t expect one person to take responsibility for solving it. However, I believe it's important to clear up some common misconceptions or "student debt urban myths" in order to create a foundation to build viable solutions.
Student Debt Myth I:
Exorbitant Student Loans are Due to a Lack of Parental Foresight or Student Responsibility
Take shelter! This is going to be a Chicken Little blog post. Are you the plan-ahead parent who has saved for your child’s education since they were named and footprinted? According to National Center for Education Statistics (NCES) data you should probably be saving much, much more than you already are. Based on the most recent NCES statistics on the cost of college (the average undergraduate tuition+fees+room & board for full-time students in the 12-13 school year), a year of college costs $20,234. This would require an extra $4,500 budgeted annually from birth until a child's 18th birthday to save enough for a four-year college education. An 18-year-old entering school in the 12-13 school year was born in 1993 or 1994. In the 93-94 school year, college only cost $12,549 (in 12-13 dollars) or $7,931 at the time. It's difficult to plan for such a steep increase when looking into your financial crystal ball.
Maybe you haven’t been able to set money aside because you’re living paycheck to paycheck like many Americans. Or you believe your kid should be the one with skin in the game; after all, it’s their education. Either way, they won’t be able to cut it
without financial aid. In 1993 and 1994, minimum wage was $4.25 and college cost an average $7,931 for the 93-94 school year. A college student could pay for college by manning the fryer. Working full-time at minimum wage for 47 weeks could cover college expenses. Today’s college student isn’t so lucky. With a $7.25 minimum wage and college costs of $20,234 in the 12-13 school year, they can’t pay for college as a full-time employee. It would take 1.34 years (70 40-hour work weeks) to pay for one year of school, and that’s before taking taxes out of their paychecks.
The disparity between the cost of college and the abilities of students and parents to pay for it is creating a dependence on financial aid. Financial aid is becoming a necessity for a college education. Everybody needs a scholarship but there isn’t one for everybody. When scholarships aren't there, grants aren't there, and savings aren't there, student loans are there—all leading to the creation of a more than 1 trillion dollar storm.
Statistics Used:
Average undergraduate tuition and fees and room and board rates charged for full-time students in degree-granting postsecondary institutions, by level and control of institution: 1963-64 through 2012-13
Historical Income Tables: Households
-Table H-3. Mean Household Income Received by Each Fifth and Top 5 Percent
Federal Minimum Wage Rates: 1955-2013
