Between 1980 and 2017, the share of adults with at least a four-year college degree doubled, from 17 percent to 34 percent. The Great Recession intensified the trend; from 2010 to 2019, the percentage of people 25 and older with a bachelor’s degree or higher increased by 6 percentage points, to 36 percent, where it sits today.
At the same time, the college degree is declining in status. It’s not just metaphorical to say that a master’s degree is the new bachelor’s degree: about 13 percent of people aged 25 and older have a master’s, about the same proportion that had a bachelor’s in 1960.
A graduate degree is enticing for various reasons. Not only does it give the recipient bragging rights, it helps find stable employment, gives more of a boost into higher-level positions and, most decisively, leads to a fatter paycheck. While workers holding a bachelor’s degree can no longer expect higher earnings as much as they once did, master’s graduates have been happily watching their salaries rise. As a result, more graduates with a BA have crowded the high-end labor market, causing even more students to pursue a master’s or Ph.D.
This paper chase has put young people and their parents in a demoralizing, self-perpetuating arms race. Postgraduate degrees are expensive, which usually means student loans. Though graduate students are only 19 percent of student borrowers, they account for 40 percent of student debt.
But for American society as a whole, this hyper-credentialism is a slow-motion disaster, with the biggest losers at the bottom of the labor market. Many jobs that used to be available to high school grads only a decade or two ago now demand at least a four-year degree, bringing more despair in working-class communities and more polarization in the country. According to The Wall Street Journal, more than 40 percent of manufacturing workers now have a college degree, up from 22 percent in 1991.
Degree inflation also widens the nation’s class divide. The prospect of debt deters low-income students from pursuing degrees that could lead to a lucrative career, according to a 2020 paper, “Inequality and Opportunity in a Perfect Storm of Graduate Student Debt.”
Universities are the prime culprit in driving this hyperactive credentialism. Over the past decades, many colleges have struggled to balance their books amid state cuts, regulatory requirements and a customer base resistant to hikes in already obscene tuitions. Graduate programs are their solution to the cash shortage: Graduate students can borrow considerably more federal money than undergrads can.
Meanwhile, employers, universities and students seem to have convinced themselves that credentials are a proxy for skills. But as the Urban Institute’s Robert Lerman observes, an academic’s idea of “skills” doesn’t really provide trade workers — or, say, occupational therapists — what they need in order to do their jobs well.
The next generation is desperate for alternatives to higher education, such as technical training and apprenticeships, and parents want these options, too. Gallup found that 46 percent of moms and dads prefer other secondary options to college for their kids “even if there were no barriers to their child earning a bachelor’s degree.” In other words, even if parents easily could afford a college degree, almost half would prefer their children to take a different educational route.
And yet, Annelies Goger of the Brookings Institution found that federal funding for public colleges and universities was $385 billion in 2017–18, compared with $14 billion for employment services and training.
Like so much else with higher education, the math just doesn’t make sense.
Kay S. Hymowitz is a City Journal contributing editor, the William E. Simon Fellow at the Manhattan Institute, and the author of “Manning Up: How the Rise of Women Has Turned Men into Boys.” This piece is adapted from City Journal.
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