The path into today’s U.S. workforce almost always includes a bachelor degree from a four year college or university. However, as job vacancies continue to grow in some sectors of the United State’s economy, some question the value and necessity of a traditional four year degree.
Last July, the Joint Economic Committee held a hearing concerning the six million job vacancies in the U.S. and the possible reasons and remedies for them. Panelists included an economist, a president of a community college, a development manager at Honda, and a public policy professor.
Panelists agreed that the United States as a whole is “overselling the bachelor’s degree,” and suggested there is an alternative path for young Americans. For example, David Harrison, President of Columbus State Community College, discussed the College’s partnership with Honda. According to his testimony, Honda has an urgent need for electro-mechanical engineering graduates. The co-op program with Honda starts in high school, and students work at Honda while earning their associate degree at Columbus State, then transition into full-time Honda employees. To top it all off, if a student in this program wants to earn a bachelor’s degree in engineering, he or she can do so through another partnership with Miami (Ohio) University, and have their tuition paid for by Honda!
Alternative pathways, like the Honda partnership, may make the most sense for some students. According to Mr. Harrison, the average bachelor’s degree holder graduates with $30,000 worth of student loan debt and takes over 20 years for them to pay it off because graduates are not making enough money when they enter the workforce. However, one student who used the community college’s co-op program was able to start working at Honda in high school, earning $18 an hour, completed his associate degree at 19, earned a $60,000/year job at Honda, and is now in a bachelor’s degree program with full tuition reimbursement from Honda. “He’s going to graduate with his bachelor’s degree in his early 20’s, not only debt-free, but he’s been making money since he was 18 at Honda. That is replicable. That is something we think is scalable,” said David Harrison.
The student loan debt in this country totals $1.3 trillion. According to the panel, there is some evidence that the bachelor’s degree has been oversold, and that the best way to get into today’s workforce is a short-term pathway like the Honda partnership. In addition, “selling manufacturing” as a great career in the United States would help fill many job vacancies. In order to do this, the panel explained that the conversation needs to change from “you must earn a bachelor’s degree” to “there are more options.”
Student debt is hurting students and our greater economy. On an individual level, student debt requires graduates to pay back a certain amount every month, prohibiting them from investing, saving, buying a house, or starting a business. A recent study about “how college debt is impacting individuals and families and how it may be impacting the overall economy” found that:
20 percent of respondents indicated they cannot get a loan for other items, are unable to purchase a home, and student loan debt negatively impacts their credit.
18 percent of individuals indicated they are living paycheck to paycheck, “drowning” in debt, and have a large debt load.
13 percent indicated they have a lower quality of life and are unable to afford the extra things.
12 percent indicated they are unable to save for their retirement or their children’s education and feel less secure.
Unfortunately, for some students who took on student loans, they may have been better off not earning a bachelor’s degree. But starting a conversation for an alternative pathway now may help future students. Filling six milling vacancies in the U.S. economy will be tough, but when young Americans are armed with facts and tangible alternatives, they can begin to create a new American renaissance.