Those Slippery Statistics
Bill Quick

Student Loans Make it Hard to Rent or Buy a Home – NYTimes.com

Still, new research suggests that college is working, economically. Four years on campus nets the average graduate almost twice as much in wages as someone without a degree. Those odds may be comforting in the long run, but not when you’re young, deeply in debt and trying to nest in New York City.

Nobody ever unpacks this statement, so I will.

Of course a college degree will net you more money over a lifetime than no degree.  A primary reason for this these days is that even decent paying jobs that used to not require a degree now do require one, even though the degree is not actually necessary in order to be able to perform the job.

Taken to an extreme, once every job requires a degree (all jobs that don’t will be done by machines) then the advantage of a degree will be more like a bazillion to one over a lifetime.

Bill Quick

About Bill Quick

I am a small-l libertarian. My primary concern is to increase individual liberty as much as possible in the face of statist efforts to restrict it from both the right and the left. If I had to sum up my beliefs as concisely as possible, I would say, "Stay out of my wallet and my bedroom," "your liberty stops at my nose," and "don't tread on me." I will believe that things are taking a turn for the better in America when married gays are able to, and do, maintain large arsenals of automatic weapons, and tax collectors are, and do, not.

Comments

Those Slippery Statistics — 2 Comments

  1. An interesting analysis might be to compare the “disposable income” of two people, one who went to college, and one that did not.

    Person A – goes to college, incurs $$K in student debt, and starts working at 22 at $X/year.
    Person B – no college, no student debt, starts working at 18 at $Y/year.

    Jigger X and Y (and have them increase over time) so that person A earns “almost twice as much” as person B by the time they’re both 65. Then take taxes and student loan payments off the top.

    I wonder what the actual difference would turn out to be.

    • That’s a very interesting question, Marshall.

      Add in opportunity costs – couldn’t buy a house because of student loans until ten years after the plumber without the degree did, couldn’t make retirement investments, etc., etc.