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Once the job market got better a couple years ago, the percentage of job postings which required a college degree dropped. In other words, the "requirement" wa

Once the job market got better a couple years ago, the percentage of job postings which required a college degree dropped. In other words, the "requirement" was mostly a way of filtering, not something that actually increased productivity. Speaking as a person with two degrees myself, I can say that non-degreed programmers seem to be just as productive as those with degrees. In fact, CS majors in particular have a problem just solving the problem in front of them, and often want to over-engineer things using the techniques and patterns they learned in school that are applicable to huge systems, whereas non-degreed programmers often just solve the actual problem they have without trying to justify (in their own minds) years spent learning other techniques. I am not at all convinced that a college-educated workforce is more productive, for more than half the jobs in which it is required.

dahart 7y ago
Productivity isn’t the metric that determines whether the government recoups student loan defaults, income is. And the income of graduates is still multiples that of non-graduates, as shown by the data in this article.
- malvosenior 7y ago
  Correlation does not equal causation. There's a very broad spectrum of people who do not have degrees. It's very likely that if you took those same people earning degrees and had them enter the workforce instead, they'd have equal or greater pay.
  - dahart 7y ago
    That isn’t supported by the data we actually have. Please take a look at Figure 3 on page 39.
    - malvosenior 7y ago
      That data doesn't reference the point I'm making. What I'm saying is that it's very possible that if the same people that got bachelor degrees instead entered the workplace, they'd have equal or greater lifetime earnings. To put it another way, earnings are correlated with an individual's talent and drive. Currently, many of those people end up getting degrees. It's a correlation, it's not the degrees that are causing the jump in earnings, it's the individual's skills.
      - dahart 7y ago
        You’re right, figure 3 doesn’t answer your question. But your point/topic is not addressing my original point. My point above was that income before taxes alone is what you need to evaluate whether the student loan program offsets the student loan default rate. The financial return on investment of the student loan program is determined solely by the increase in income, not the wealth premium. To address your separate point directly, there are studies that attempt to directly answer the question you’re asking. For example: http://conference.iza.org/conference_files/CoNoCoSk2011/gensowski_m6556.pdf http://conference.iza.org/conference_files/CoNoCoSk2011/gens... However, your conclusion isn’t shared by the authors. They show a positive return on college degrees, it’s just smaller than the unadjusted difference in income. One probable factor for this is cultural bias toward giving jobs to people with degrees, and paying employees more who have degrees. Individual skills alone do not explain the difference in earnings, so despite the fact that talent correllates with income, the correlation is not 1, and thus it is not likely that the same people earn equal or greater without a degree than with. It is likely that the same person without a degree will earn less than with a degree, on average.
    - rossdavidh 7y ago
      That doesn't say anything about which is cause and which is effect, which is what is relevant for an increase in college education to make a more productive workforce. In fact, the labor productivity growth rate does not seem to have significantly changed at all, even as the percentage which is college educated has gone up a lot: https://stats.oecd.org/Index.aspx?DataSetCode=PDYGTH https://stats.oecd.org/Index.aspx?DataSetCode=PDYGTH
      - dahart 7y ago
        Again, I wasn’t talking about productivity, that is orthogonal to my point. I was talking about the income taxes that the government extracts from the workforce, and the income taxes the government gets are higher on average from college grads. Productivity is subjective, and while it matters indirectly to whether the economy is growing, it has no direct bearing on whether the government recoups it’s investment in student loans after losses from defaults. Income taxes directly offset those losses. Productivity... who knows, it depends heavily on your agenda and point of view. To address your point directly, I don’t personally believe that non-grad programmers are as economically productive as grads on average. I would totally believe that non-grads are as productive at building UI widgets and CRUD apps and stuff like that. However, inventions and patents are absolutely dominated by people with postgraduate degrees. It’s not a matter of hourly output, it’s a matter of yearly compound interest, and the compound interest in computer programming is generated by research. It is overwhelmingly PhDs who are developing neural networks and AI methods right now, overwhelmingly postgraduates who are the architects of new hardware and of new software methods. These are the things making the computer industry grow larger in fundamental ways.
        rossdavidh 7y ago
        Having done my master's degree in neural networks in the 90's, I reluctantly have to admit that they are not all that productive in the great majority of cases where they are used (although there are exceptions). The reality is that the vast majority of what AI or neural networks are used on, is buzzword bingo.
        7y ago
- rayiner 7y ago
  Individually, yes. But that doesn’t mean that people are making more money in the aggregate by more people going to college. If the government subsidizes college and that results in more people going to college, but employers just respond by taking previously non-college jobs and making them require college degrees, there isn’t actually more money in the economy as a result to justify the government expenditure.
  - dahart 7y ago
    You’re moving your own goal post. You complained about the government’s relatively small outputs from the student loan program, which is absolutely recouped many times over by today’s income premium, in the form of income taxes, regardless of whether the economy grows. Your hypothetical isn’t the way things are actually playing out, so I don’t feel like it needs to be argued. Degree holders are generating value on average, so the economy does, in fact, have more money as a result of education. And the government also makes money on it’s investment in education on top of that.
    - Akababa 7y ago
      I feel like you're talking past a lot of the other commenters in this thread. I'll try to frame it another way: Generating value is synonymous with growing the economy and being more productive. You can't inflate incomes without either increasing productivity or printing money. If degree holders command higher incomes without offering higher productivity, it comes at the expense of non-degree holders earning lower wages than they would have without the degree holders around. In my opinion, much of the income premium comes from employers using degrees as a filter (similar to a standardized test). Doing well on the SAT doesn't make you more productive, but does give you a leg up over your peers.
      - dahart 7y ago
        I totally agree that a big factor in income differences is due to cultural biases that favor degree holders. I don’t think degrees are economically zero value though, for example patents are primarily held by inventors with postgraduate degrees, and more businesses are started by degree holders. I’m not really sure how to answer your first part, I’m not trying to talk past anyone, but I feel like people are responding to my point that the income premium is what matters to the student loan program by repeating the conclusion of the paper that the wealth premium is going to zero. The income premium and the wealth premium in this paper are two different things, and even though people with degrees might end up having net zero additional wealth accumulation at the end of their lives, that doesn’t mean the student loan program is also net zero, or that people with and without degrees have the same lifestyle. The student loan program gets to make it’s money back before degree holders get to save the money, so the income premium matters to the government more than the wealth premium, when figuring out whether forgiving loans is worth it or not.

dahart 7y ago

Productivity isn’t the metric that determines whether the government recoups student loan defaults, income is. And the income of graduates is still multiples that of non-graduates, as shown by the data in this article.

malvosenior 7y ago
Correlation does not equal causation. There's a very broad spectrum of people who do not have degrees. It's very likely that if you took those same people earning degrees and had them enter the workforce instead, they'd have equal or greater pay.
- dahart 7y ago
  That isn’t supported by the data we actually have. Please take a look at Figure 3 on page 39.
  - malvosenior 7y ago
    That data doesn't reference the point I'm making. What I'm saying is that it's very possible that if the same people that got bachelor degrees instead entered the workplace, they'd have equal or greater lifetime earnings. To put it another way, earnings are correlated with an individual's talent and drive. Currently, many of those people end up getting degrees. It's a correlation, it's not the degrees that are causing the jump in earnings, it's the individual's skills.
    - dahart 7y ago
      You’re right, figure 3 doesn’t answer your question. But your point/topic is not addressing my original point. My point above was that income before taxes alone is what you need to evaluate whether the student loan program offsets the student loan default rate. The financial return on investment of the student loan program is determined solely by the increase in income, not the wealth premium. To address your separate point directly, there are studies that attempt to directly answer the question you’re asking. For example: http://conference.iza.org/conference_files/CoNoCoSk2011/gensowski_m6556.pdf http://conference.iza.org/conference_files/CoNoCoSk2011/gens... However, your conclusion isn’t shared by the authors. They show a positive return on college degrees, it’s just smaller than the unadjusted difference in income. One probable factor for this is cultural bias toward giving jobs to people with degrees, and paying employees more who have degrees. Individual skills alone do not explain the difference in earnings, so despite the fact that talent correllates with income, the correlation is not 1, and thus it is not likely that the same people earn equal or greater without a degree than with. It is likely that the same person without a degree will earn less than with a degree, on average.
  - rossdavidh 7y ago
    That doesn't say anything about which is cause and which is effect, which is what is relevant for an increase in college education to make a more productive workforce. In fact, the labor productivity growth rate does not seem to have significantly changed at all, even as the percentage which is college educated has gone up a lot: https://stats.oecd.org/Index.aspx?DataSetCode=PDYGTH https://stats.oecd.org/Index.aspx?DataSetCode=PDYGTH
    - dahart 7y ago
      Again, I wasn’t talking about productivity, that is orthogonal to my point. I was talking about the income taxes that the government extracts from the workforce, and the income taxes the government gets are higher on average from college grads. Productivity is subjective, and while it matters indirectly to whether the economy is growing, it has no direct bearing on whether the government recoups it’s investment in student loans after losses from defaults. Income taxes directly offset those losses. Productivity... who knows, it depends heavily on your agenda and point of view. To address your point directly, I don’t personally believe that non-grad programmers are as economically productive as grads on average. I would totally believe that non-grads are as productive at building UI widgets and CRUD apps and stuff like that. However, inventions and patents are absolutely dominated by people with postgraduate degrees. It’s not a matter of hourly output, it’s a matter of yearly compound interest, and the compound interest in computer programming is generated by research. It is overwhelmingly PhDs who are developing neural networks and AI methods right now, overwhelmingly postgraduates who are the architects of new hardware and of new software methods. These are the things making the computer industry grow larger in fundamental ways.
      - rossdavidh 7y ago
        Having done my master's degree in neural networks in the 90's, I reluctantly have to admit that they are not all that productive in the great majority of cases where they are used (although there are exceptions). The reality is that the vast majority of what AI or neural networks are used on, is buzzword bingo.
        7y ago
rayiner 7y ago
Individually, yes. But that doesn’t mean that people are making more money in the aggregate by more people going to college. If the government subsidizes college and that results in more people going to college, but employers just respond by taking previously non-college jobs and making them require college degrees, there isn’t actually more money in the economy as a result to justify the government expenditure.
- dahart 7y ago
  You’re moving your own goal post. You complained about the government’s relatively small outputs from the student loan program, which is absolutely recouped many times over by today’s income premium, in the form of income taxes, regardless of whether the economy grows. Your hypothetical isn’t the way things are actually playing out, so I don’t feel like it needs to be argued. Degree holders are generating value on average, so the economy does, in fact, have more money as a result of education. And the government also makes money on it’s investment in education on top of that.
  - Akababa 7y ago
    I feel like you're talking past a lot of the other commenters in this thread. I'll try to frame it another way: Generating value is synonymous with growing the economy and being more productive. You can't inflate incomes without either increasing productivity or printing money. If degree holders command higher incomes without offering higher productivity, it comes at the expense of non-degree holders earning lower wages than they would have without the degree holders around. In my opinion, much of the income premium comes from employers using degrees as a filter (similar to a standardized test). Doing well on the SAT doesn't make you more productive, but does give you a leg up over your peers.
    - dahart 7y ago
      I totally agree that a big factor in income differences is due to cultural biases that favor degree holders. I don’t think degrees are economically zero value though, for example patents are primarily held by inventors with postgraduate degrees, and more businesses are started by degree holders. I’m not really sure how to answer your first part, I’m not trying to talk past anyone, but I feel like people are responding to my point that the income premium is what matters to the student loan program by repeating the conclusion of the paper that the wealth premium is going to zero. The income premium and the wealth premium in this paper are two different things, and even though people with degrees might end up having net zero additional wealth accumulation at the end of their lives, that doesn’t mean the student loan program is also net zero, or that people with and without degrees have the same lifestyle. The student loan program gets to make it’s money back before degree holders get to save the money, so the income premium matters to the government more than the wealth premium, when figuring out whether forgiving loans is worth it or not.