Right now, around kitchen tables all over the country, high school seniors and their parents are sweating out the waning days of the current college application season. Should they go with the in-state college with the relatively low price? Should they opt for the school they’ve had their eye on since birth…the one with a purportedly valuable brand name and the hefty sticker price to match?
A few decades ago, college decisions might not have been such a tough choice. Longstanding liberal-arts jokes to the contrary (and I’m a proud liberal arts grad, thank you very much), students in the ‘70s and ‘80s could choose their school/major based on desire. But these days, with costs and debt so outlandishly high, prospective students feel like they practically have to game the system to make a choice. Hence the number of articles purporting to tell people which schools and majors produce the richest alums, and so the best return on investment.
Gaming College Decisions: Striking Gold or Striking Out
Trouble is, those articles may be able to tell you the trends, but they can’t tell you whether your individual degree will strike gold. The odds may be great that your STEM diploma will pay off. But without a crystal ball, decisions made that way amount to a sophisticated form of gambling. And it’s hardly a bargain if STEM subjects are things you hate.
Instead of being so focused on the return, today’s high school seniors and their parents should be counseled to focus on the investment. How much will they be taking on in debt – and how hard is it going to be to pay back?
Unfortunately, most people don’t have anyone in their corner telling them to do that; and they’re so caught up in getting the “yes,” they fail to think about how many thousands per month that five-figure debt will really mean. And the consequences are to the economy and businesses as well as to the individual.
How exactly will organizations feel today’s college decisions in the future?
Shortage of engaged employees
Copious amounts of debt leads people to make career choices for purely financial reasons. When an employee takes a job purely for money (as opposed to passion) engagement suffers. Multiply that by the fact that nearly three-quarters of Millennials are graduating with debt, and that the average amount owed is $35,000, and you’re looking at a future workforce full of unhappy people.
Shortage of top performers in the field
Just as debt impacts engagement after the fact, it can affect major choices before. Teenagers trying to game the system with their college decisions may opt for a career that takes them away from the specialties they’re good at, and the ones that your organization (and perhaps society) needs.
Dearth of Entrepreneurs
Great ideas come down to more than just the individual light-bulb moment, but the ability to pursue those ideas into reality. And that’s becoming harder to do when expected earnings start out $1,000 or more in the hole. One story in the New York Times showed a desirable startup incubator populated almost exclusively by those with minimal debt. “According to Gallup’s polling data, most entrepreneurs owe less than $10,000 in student loans,” wrote the author, “debt any greater has a negative impact on the decision to start a business.”
The Next Big Thing
The modern startup economy has produced not only individual gazillionaires, but technology, growth, and innovations that have branched out well beyond the entrepreneurs (and their startups) themselves. But producing those innovations may be at risk. Just like entrepreneurs, we need people with the brain capacity and desire to generate those brainstorms without being hamstrung by choices they made as adolescents. “Few emerging adults willing to take a chance on their business idea,” wrote that same New York Times article, “makes it harder for everyone else to get a job.”
Encouraging High School Students to Have Their Eyes Wide Open
None of this is to say that students should summarily toss that top-notch school for a full ride to a college they hate. Nor should it imply that any and all debt is bad and should be avoided. It’s a fact of the modern era that for many students, some debt will be the price of entry.
But there’s room to improve the situation. Families of prospective students should know they have room to negotiate for more aid. They should understand that there are strategies – both for paying and saving for college – that can bring the cost down. And they should be counseled to go in with their eyes wide open so they know exactly what they’re signing on for.
That kind of counseling is an easy thing for employers to help with. And it’s a benefit to all of us that they do.