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You want your child to go to college because: 1) The average run of the mill degree results in twice the earnings and half the unemployment of those with just

You want your child to go to college because: 1) The average run of the mill degree results in twice the earnings and half the unemployment of those with just high school. 2) The average run of the mill degree results in a $900k lift in lifetime earnings (for men) over a high school diploma. The lift for women is not quite that much but that might have something to do with the types of degrees that each get. These numbers are averages so if your child completes a stem degree from say MIT, the lift in lifetime earnings is likely quite a bit more than that. Want more? Check out : https://www.bls.gov/emp/ep_chart_001.htm https://www.bls.gov/emp/ep_chart_001.htm

wojt_eu 9y ago
This shows correlation but not causation. Hypothetically: people with certain background (social class) and traits (IQ) are more likely to go to college, and they would fare as well or better without college. I'd be very interested in stats of lifetime earnings difference that was corrected for selection bias.
- uberman 9y ago
  Would a 1% sample of the US population that included level of education and earnings do the trick for you? https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ACS_pums_csv_2016&prodType=document https://factfinder.census.gov/faces/tableservices/jsf/pages/... It is not going to have variables like "Social status of your parents" or "IQ" but it does have a rather extensive list of demographic variables to control for. Let me know what you uncover.
  - jessriedel 9y ago
    IQ, conscientiousness, and parental social status are probably the three biggest determiners of success, presumably none of which are being controlled for.
  - the_watcher 9y ago
    Sample size doesn't impact the fact that you shouldn't draw causal conclusions from merely correlative data.
    - uberman 9y ago
      Then perhaps you might want to check out some twins studies: http://davidcard.berkeley.edu/papers/causal_educ_earnings.pdf http://davidcard.berkeley.edu/papers/causal_educ_earnings.pd... and/or http://www.nytimes.com/1992/08/19/education/twins-study-shows-school-is-sound-investment.html http://www.nytimes.com/1992/08/19/education/twins-study-show... I'm going to strongly encourage my kids to go to college. Frankly if you/anyone is not convinced that higher education leads to increased earnings then by all means forgo college and keep your kids at home. My kids will have plenty of competition for jobs from those with higher degrees from around the world as it is.
      - ithilglin909 9y ago
        I would absolutely prefer to send my (hypothetical) children to college for the reasons you've stated here. But really: are increased earnings due to anything people learn at college or because of its social value? I.e. it's been over-sold and many people will assume you're dumb/couldn't get accepted somewhere if you don't play along.
      - kimmel 9y ago
        The 1992 study is basically irrelevant since the job market has changed drastically. There are way more self taught computer people out making money without degrees than in 1992 as just one major factor that has changed in over two decades. The Berkeley study is missing a lot of data and is dated as well from 1999. I searched for the most common high paying non-degree jobs and found nothing about them. Plumbers, electricians, construction contractors, certain kinds of farmers, etc... Recently on HN it was said that construction works in California were starting at $45 an hour in many places. I know plenty of people who got non-stem degrees that do not make that 10+ years out of college and working professionally in their field the whole time. Furthermore there is the trend of people getting degrees in fields that will not yield jobs or fields that are over saturated. Take lawyers and this article from 2016 https://www.nytimes.com/2016/06/19/business/dealbook/an-expensive-law-degree-and-no-place-to-use-it.html https://www.nytimes.com/2016/06/19/business/dealbook/an-expe... and this one from 2017 https://www.usatoday.com/story/news/2017/06/28/law-schools-hunkering-down-enrollment-slips/430213001/ https://www.usatoday.com/story/news/2017/06/28/law-schools-h... . There are plenty more articles going back more than a few years about it. Then there is the issue of colleges and textbooks constantly increasing costs while not increasing the value of the degree itself. In fact in many instances degrees are worth less now since colleges pass students to keep that fire hose of government backed money coming in. There are numerous documentaries on youtube that go into depth of how colleges are ripping people off in many instances. The main value of college is the ability to network with people so that finding and getting a job becomes easier. The job hunting process is broken and there are always new startups trying to fix it. In high school they pushed college as the solution to everything harder than a drug dealer slinging product. It is easy to find people who got that degree and their job and earning problems are not solved. Going to college no matter what is a dogma. It is not clear at all that a college education is going to increase your lifetime earning. You have to pick the right field, get your debt settled quickly, live in or move to the right area and conquer the job hunting process and then you might come out ahead. I think high school students should be better educated on how the market works and there are plenty of non-degree jobs that have serious earning potential. Also the US has neglected trade schools as a job training solution while European countries have not.
nshelly 9y ago
If a student can get into MIT that student will likely be financially well off no matter where they go, even after an upper middle-class family spends nearly $300,000 in tuition, room and board. It's the edge cases that are much harder. Try comparing an expensive private school for four years with a state school (three if they accept AP courses). Of course there are a lot of other non-financial reasons to attend college, such as growing a circle of friends and being exposed to new ideas in a formal setting. It's unclear how to value that properly however.
exclusiv 9y ago
In this case, I don't think your data is that strong. The parent could get them an entry level job in tech, conceivably one comparable with one one would obtain fresh out of college. Separately from this specific case, remember, to pay off 200k in debt (cost of many good public schools), you need to make about 2M! If you save 20%, then you need an EXTRA 1M over not going to college just to break even. I'm not even factoring in interest that many students are getting these days. And then you have the opportunity cost of not investing the money you did make when you didn't have debt by skipping college. So when you consider these things, a 900k bump in lifetime earnings doesn't look good. Now if you get a scholarship or if you factor in the intangibles the parent mentions then I think it's a no brainer. But strictly from a lifetime earnings standpoint it's oversold. You have to factor in the foregone earnings, the debt, the interest and the opportunity cost of not being able to save and invest money. Personally I think it's worth it but best for most people to go to a lower tier university that won't start them off with a mountain of debt.
- uberman 9y ago
  You can certainly accumulate a mountain of debt and one should factor that in. Not all degrees at all colleges make economic sense or have the same rate of return. That said, there are plenty of net present value calculations that include opportunity costs including in the links I have provided. I want to correct a few things though. Leaving the opportunity to take 2 years of community college and finish at a university aside, the most expensive public school in the USA (for in-state students) is the University of Pittsburgh at about $19k a year. Your $200k debt for public education is either grossly exaggerated, is for out of state tuition and/or includes other factors such as housing and food (items that you would have had to purchase regardless of college status). In fact, the average graduation debt for those at public institutions was $25,550 not $200,000. The opportunity cost to invest the cost of college is also unrealistic. Unless you are a Thiel Fellow, no one is going to loan/give you $200k to "play the market" as a high school graduate. You do get an economic advantage of entering the workforce sooner than a college graduate, but that advantage lasts for about 10 years on average and by that time a college graduate typically catches the earnings of a high school graduate (cost of degree and opportunity included). You might also be interested in this Brookings report comparing investing is stocks, bonds, or university https://www.brookings.edu/research/where-is-the-best-place-to-invest-102000-in-stocks-bonds-or-a-college-degree/ https://www.brookings.edu/research/where-is-the-best-place-t...
JamesBarney 9y ago
The average person who graduates from college is different from.the average person who doesn't in more attributes than "degree held".
- uberman 9y ago
  Read the rest of this branch of the thread including links to twins studies. If you disagree after reading that and the evidence I present then we will agree to disagree.
  - JamesBarney 9y ago
    The Australian twins study didn't look at income. They looked "two-digit occupation" codes. Also whether you use monozygotic or dizygotic twins matters. See https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3359051/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3359051/ When just looking at monozygotic twins, ones that don't attend university actually make more money.
Z-Widwil 9y ago
When you say 'run of the mill degree' are you referring to Associates, Bachelor, or higher? Additionally, do you know how the data you shared compares to individuals with technical certificates?

wojt_eu 9y ago

This shows correlation but not causation. Hypothetically: people with certain background (social class) and traits (IQ) are more likely to go to college, and they would fare as well or better without college. I'd be very interested in stats of lifetime earnings difference that was corrected for selection bias.

uberman 9y ago
Would a 1% sample of the US population that included level of education and earnings do the trick for you? https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ACS_pums_csv_2016&prodType=document https://factfinder.census.gov/faces/tableservices/jsf/pages/... It is not going to have variables like "Social status of your parents" or "IQ" but it does have a rather extensive list of demographic variables to control for. Let me know what you uncover.
- jessriedel 9y ago
  IQ, conscientiousness, and parental social status are probably the three biggest determiners of success, presumably none of which are being controlled for.
- the_watcher 9y ago
  Sample size doesn't impact the fact that you shouldn't draw causal conclusions from merely correlative data.
  - uberman 9y ago
    Then perhaps you might want to check out some twins studies: http://davidcard.berkeley.edu/papers/causal_educ_earnings.pdf http://davidcard.berkeley.edu/papers/causal_educ_earnings.pd... and/or http://www.nytimes.com/1992/08/19/education/twins-study-shows-school-is-sound-investment.html http://www.nytimes.com/1992/08/19/education/twins-study-show... I'm going to strongly encourage my kids to go to college. Frankly if you/anyone is not convinced that higher education leads to increased earnings then by all means forgo college and keep your kids at home. My kids will have plenty of competition for jobs from those with higher degrees from around the world as it is.
    - ithilglin909 9y ago
      I would absolutely prefer to send my (hypothetical) children to college for the reasons you've stated here. But really: are increased earnings due to anything people learn at college or because of its social value? I.e. it's been over-sold and many people will assume you're dumb/couldn't get accepted somewhere if you don't play along.
    - kimmel 9y ago
      The 1992 study is basically irrelevant since the job market has changed drastically. There are way more self taught computer people out making money without degrees than in 1992 as just one major factor that has changed in over two decades. The Berkeley study is missing a lot of data and is dated as well from 1999. I searched for the most common high paying non-degree jobs and found nothing about them. Plumbers, electricians, construction contractors, certain kinds of farmers, etc... Recently on HN it was said that construction works in California were starting at $45 an hour in many places. I know plenty of people who got non-stem degrees that do not make that 10+ years out of college and working professionally in their field the whole time. Furthermore there is the trend of people getting degrees in fields that will not yield jobs or fields that are over saturated. Take lawyers and this article from 2016 https://www.nytimes.com/2016/06/19/business/dealbook/an-expensive-law-degree-and-no-place-to-use-it.html https://www.nytimes.com/2016/06/19/business/dealbook/an-expe... and this one from 2017 https://www.usatoday.com/story/news/2017/06/28/law-schools-hunkering-down-enrollment-slips/430213001/ https://www.usatoday.com/story/news/2017/06/28/law-schools-h... . There are plenty more articles going back more than a few years about it. Then there is the issue of colleges and textbooks constantly increasing costs while not increasing the value of the degree itself. In fact in many instances degrees are worth less now since colleges pass students to keep that fire hose of government backed money coming in. There are numerous documentaries on youtube that go into depth of how colleges are ripping people off in many instances. The main value of college is the ability to network with people so that finding and getting a job becomes easier. The job hunting process is broken and there are always new startups trying to fix it. In high school they pushed college as the solution to everything harder than a drug dealer slinging product. It is easy to find people who got that degree and their job and earning problems are not solved. Going to college no matter what is a dogma. It is not clear at all that a college education is going to increase your lifetime earning. You have to pick the right field, get your debt settled quickly, live in or move to the right area and conquer the job hunting process and then you might come out ahead. I think high school students should be better educated on how the market works and there are plenty of non-degree jobs that have serious earning potential. Also the US has neglected trade schools as a job training solution while European countries have not.

nshelly 9y ago

If a student can get into MIT that student will likely be financially well off no matter where they go, even after an upper middle-class family spends nearly $300,000 in tuition, room and board. It's the edge cases that are much harder. Try comparing an expensive private school for four years with a state school (three if they accept AP courses). Of course there are a lot of other non-financial reasons to attend college, such as growing a circle of friends and being exposed to new ideas in a formal setting. It's unclear how to value that properly however.

exclusiv 9y ago

In this case, I don't think your data is that strong. The parent could get them an entry level job in tech, conceivably one comparable with one one would obtain fresh out of college. Separately from this specific case, remember, to pay off 200k in debt (cost of many good public schools), you need to make about 2M! If you save 20%, then you need an EXTRA 1M over not going to college just to break even. I'm not even factoring in interest that many students are getting these days. And then you have the opportunity cost of not investing the money you did make when you didn't have debt by skipping college. So when you consider these things, a 900k bump in lifetime earnings doesn't look good. Now if you get a scholarship or if you factor in the intangibles the parent mentions then I think it's a no brainer. But strictly from a lifetime earnings standpoint it's oversold. You have to factor in the foregone earnings, the debt, the interest and the opportunity cost of not being able to save and invest money. Personally I think it's worth it but best for most people to go to a lower tier university that won't start them off with a mountain of debt.

uberman 9y ago
You can certainly accumulate a mountain of debt and one should factor that in. Not all degrees at all colleges make economic sense or have the same rate of return. That said, there are plenty of net present value calculations that include opportunity costs including in the links I have provided. I want to correct a few things though. Leaving the opportunity to take 2 years of community college and finish at a university aside, the most expensive public school in the USA (for in-state students) is the University of Pittsburgh at about $19k a year. Your $200k debt for public education is either grossly exaggerated, is for out of state tuition and/or includes other factors such as housing and food (items that you would have had to purchase regardless of college status). In fact, the average graduation debt for those at public institutions was $25,550 not $200,000. The opportunity cost to invest the cost of college is also unrealistic. Unless you are a Thiel Fellow, no one is going to loan/give you $200k to "play the market" as a high school graduate. You do get an economic advantage of entering the workforce sooner than a college graduate, but that advantage lasts for about 10 years on average and by that time a college graduate typically catches the earnings of a high school graduate (cost of degree and opportunity included). You might also be interested in this Brookings report comparing investing is stocks, bonds, or university https://www.brookings.edu/research/where-is-the-best-place-to-invest-102000-in-stocks-bonds-or-a-college-degree/ https://www.brookings.edu/research/where-is-the-best-place-t...

JamesBarney 9y ago

The average person who graduates from college is different from.the average person who doesn't in more attributes than "degree held".

uberman 9y ago
Read the rest of this branch of the thread including links to twins studies. If you disagree after reading that and the evidence I present then we will agree to disagree.
- JamesBarney 9y ago
  The Australian twins study didn't look at income. They looked "two-digit occupation" codes. Also whether you use monozygotic or dizygotic twins matters. See https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3359051/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3359051/ When just looking at monozygotic twins, ones that don't attend university actually make more money.

Z-Widwil 9y ago

When you say 'run of the mill degree' are you referring to Associates, Bachelor, or higher? Additionally, do you know how the data you shared compares to individuals with technical certificates?