On this site we’re always interested in spotting market inefficiencies, which are actually arbitrage opportunities for those in the know.
In the US, the chorus from advisers that students from high school on are exposed to is that they must attend college. Anything less and they’ll turn out to be failures in life. Indeed, higher education attainment has traditionally been associated with desirable socioeconomic outcomes – more stable marriages, higher lifetime earnings, longer life expectancy, and increased life satisfaction. However, one has to question if we’ve exceeded the tipping point. By not only neglecting but actively stigmatizing those in vocational education, we’ve created a relative glut of educated liberal arts graduates, relative to a shortage in STEM graduates and labourers. It’s as if the constant exhortation to go to college outweighed any consideration of what to study when you’re actually in college.
Maybe if we unraveled the data we’d find that on a whole, college graduates do better than high school graduates or those with an associates degree. But maybe that’s from self selection bias. What if we took someone motivated and smart enough to go to college but have that person start a business instead? Or as I advocate in my book, consider getting a head start on earning and investing by working in the trades. Given today’s shortage of mechanics, plumbers, and construction workers, it may not be a bad idea to acquire expertise and then start a small business hiring others to do the work on a larger regional scale.
Perhaps if we also parsed the data more finely, we’d see that your choice of major can cause you to be saddled with debt and have more trouble getting a job that pays less than the trades. See this aggregate of studies from Georgetown, which shows that median starting wages for arts, humanities, and liberal arts graduates is just $29000 annually. You can do better than that as an ironworker, even if you’re a woman.
In a quest for prestige and rankings, and to bolster real-estate values, high schools also like to emphasize the number of their graduates who go on to four-year colleges and universities.
Jessica Bruce followed that path, enrolling in community college after high school for one main reason: because she was recruited to play fast-pitch softball. “I was still trying to figure out what I wanted to do with my life,” she said.
Now, she’s an apprentice ironworker, making $32.42 an hour, or more than $60,000 a year, while continuing her training. At 5-foot-2, “I can run with the big boys,” she said, laughing.
As for whether anyone looks down on her for not having a bachelor’s degree, Bruce doesn’t particularly care.
“The misconception,” she said, “is that we don’t make as much money.”
And then she laughed again.
Let’s all do our part to stop denigrating vocational education and instead invest in expanding its reach. Germany, through dedicated focus, has made it a very successful track to a stable middle class life. We should stop channeling students (and our children) blindly into higher education when it may not be the best path. College is not for everyone.