wodehouse
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Post by wodehouse on May 24, 2011 12:07:44 GMT -5
An abstact of a new university study showed up in my in-box today. This seems to be a more complete and detailed study on lifetime earnings of college grads and non-college grads than has been available in the past. See cew.georgetown.edu/whatsitworth/ (yes, they might have a vested interest and might be tootin' their own horn, but I think this is a realistic study.) Even 40 years ago (1970's) I read how a college grad was expected to earn 2-3 times in their career what a non-grad would get. This figure is still quoted even in the new study, but there is a more detailed view there. I would not be so impressed with a 2-3 times multiplier. But this is on average and is swayed by the relatively lower earnings for a number of degrees. I suspect that the lifetime premium for a good marketable degree is probably more like 5-6 times (or more) versus unskilled HS diploma-only, working non-management jobs at Wal-Mart, etc. For a specialized degree, the premium is probably much more. I went back to university in my late 20's and got a BS and MS. This not only put me on a higher earnings-level "track", but the track itself had a much steeper slope to it and has not topped out (inflation adjusted), whereas my previous work would have leveled out. My own view is that some form of education or training is necessary beyond high school, unless one is happy to live a lifetime working at dead-end jobs. Or you are so special with innate skills and drive that you can be another Bill Gates, Michael Dell, etc...but those people are few and far between. So most people will be best off getting a useful degree from college or university, junior college certificate in a marketable skill, trade school for skilled tradesman, etc. The other side of this coin is that you have to consider the costs of the training. Certainly it's scary to have beaucoup dollars in student loans. One has to weigh carefully the cost benefits and risk of the particular program and costs. A side note to this are the "for profit" schools that teach some sort of skill...these range from places like Phoenix University with business-type programs, to ITT Tech, to barber schools. Some of these are pretty much scams where the student is left with bills for huge loans and little marketable skill. These schools are now under a lot of scrutiny for some overblown practices. Took me a long time in my 20's to learn this lesson. Today I am so glad that I did.
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Mad Dawg Wiccan
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Post by Mad Dawg Wiccan on May 24, 2011 12:16:58 GMT -5
ITT Tech sucks. I have been on interview panels with graduates from their electronics program, and they don't even have fundamental knowledge. We finally just started tossing out any resumes from them.
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Firebird
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Post by Firebird on May 24, 2011 12:23:13 GMT -5
I suspect that the lifetime premium for a good marketable degree is probably more like 5-6 times (or more) versus unskilled HS diploma-only, working non-management jobs at Wal-Mart, etc.
Two key phrases there - I bolded them. If you're going to go to college, make sure to get a good marketable degree, bearing in mind that marketability has trends like everything else. A law degree used to be a slam dunk to a high-paying career, but now that the country is saturated with lawyers, the demand is a lot lower and so are the paychecks (but you still pay the same big fat wad of money to go to law school, if not more).
Likewise, degrees in nursing, business, engineering and so forth are not likely to go out of vogue anytime soon. Those are currently pretty safe bets.
The second key point - if you decide to go to work instead of school, make sure to do better than entry-level Wal*Mart jobs. You should be getting management experience as soon as humanly possible, building your skills, building your resume and generally making yourself more employable. The more relevant experience you have that not just anyone can walk in off the street and get, the more likely it is that you'll be able to find a job despite your lack of education.
Again, I've been on both sides of the fence here. I did okay without a degree because I made sure to polish a marketable skill set, and it paid off. DF has good management experience that has seen him through his lack of a degree so far. A degree helped me get even further than I otherwise would have - it might not do the same for him, or it might. It's hard to say.
A degree is a good idea only if you have a good plan. Likewise, NO degree is a good idea only if you have a good plan. Basically, if you're 18 you need a good plan.
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qofcc
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Post by qofcc on May 24, 2011 12:48:53 GMT -5
Of course someone with a marketable degree is going to make more than an entry level clerk at Wal-Mart. That's apples & oranges. I think a more relevant survey would be for jobs where a degree (or an advanced degree) is preferred, but not strictly required, what is the salary gap between those with a degree and those without. Particularly common jobs that pay median level salaries. Ex., technical and business professions. Computer programming, tech support, equipment repair, customer service, lower/middle management, administrative work, etc.
I'd like to see a comparison in lifetime earnings net of education cost on people who start out as help desk support and work their way up to IT manager with no degree vs. someone who walks in at a supervisor level with a degree. Or someone who starts out as an administrative assistant without a degree and works their way up to office manager. Or a sales clerk who becomes a store manager. Or a maintenance mechanic who becomes an equipment repair engineer. Or a waitress who becomes restaurant manager.
Does anyone know if such a survey exists?
I know people who have done all of those things, but has the world moved on to the point where those opportunities don't exist anymore?
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Post by Deleted on May 24, 2011 12:50:38 GMT -5
Firebird Great post! ![](http://us.social.s-msn.com/s/images/emoticons/thumbs_up.gif) Those that fail to plan, plan to fail as the saying goes. College IS NOT for everyone....but skillz pay the bills. Find something that you are passionate about....and figure out how to make money doing it. The more you love what you do...the better at it you will become, and over time, the more money you should make. Not everyone has the 6 figure number in their head as to wage needed.....but the more you make, the better one can handle the ups and downs of life All lessons from my grandfather.....and ones i taught to my kids.
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Firebird
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Post by Firebird on May 24, 2011 12:52:48 GMT -5
Does anyone know if such a survey exists?
None that I know of, but it would be interesting to see one for sure.
Of course, the natural problem with that is how in some situations you can be tied to your employer and unable to get back to a similar caliber position, should you lose yours, without a degree. Not that I need to tell you that (although it sounds like you'll be marketable regardless).
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wodehouse
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Post by wodehouse on May 24, 2011 13:01:45 GMT -5
I could say that I am one of those people who went from "shoe clerk to store manager". Except that my path included obtaining my univ degrees along the way.
My own perception in all this is that those with a good education (or skills training)...ie: didn't just skate through undergrad with party hearty mentality...are doing okay for themselves. Those without this skill set...it's a sinking ship for them.
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qofcc
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Post by qofcc on May 24, 2011 13:12:43 GMT -5
Of course, the natural problem with that is how in some situations you can be tied to your employer and unable to get back to a similar caliber position, should you lose yours, without a degree. Not that I need to tell you that (although it sounds like you'll be marketable regardless).
Yes, that is a risk I'm very aware of. That's why I'd kind of like to see it analyzed weighing risk/rewards. You risk spending time & money on a degree and not earning enough to outweigh your investment of time & money or you risk investing your time and effort in a job and have skills that are not transferable to another employer or having your resume ignored when applying for other jobs because of lack of a degree.
I think if someone has the opportunity to go to college right after high school without taking on a lot of debt or sacrificing relationships to do it and has the academic ability, they should probably go ahead and get it over with. But for those who would need to take on the risk of significant debt or have already taken on life responsibilities of a spouse or children, or who have the opportunity to try for some other career path (like sports or the arts or a family business), or who struggles academically then it's not a clear cut decision.
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thyme4change
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Post by thyme4change on May 24, 2011 13:15:32 GMT -5
85% of the households that earn over $150k per year have at least a bachelors degree.
Although that is no guarantee, I would rather run with the statistics than against them.
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qofcc
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Post by qofcc on May 24, 2011 14:08:23 GMT -5
85% of the households that earn over $150k per year have at least a bachelors degree.
Although that is no guarantee, I would rather run with the statistics than against them.$150K is a top 5% wage earner salary. www.census.gov/hhes/www/cpstables/032010/rdcall/1_008.htmAssuming the median HOUSEHOLD income with at least 1 full-time worker is $71K and 70% of households earn less than $100K, one would have to expect that the majority of people are going to end up with a salary of under $100K regardless of their level of education. Just because more people earn college degrees, doesn't mean that the number of jobs paying over $100K is going to increase. nces.ed.gov/nationsreportcard/hsts/tables/hsts006.aspThe mean GPA of high school graduates in 2000 was 2.94. That's not quite a B. Most of these folks are not getting academic scholarships. If you're not getting a scholarship and you don't expect to be earning a high salary, you have a different college/career decision to make than someone who is a top 5% or even top 20% achiever.
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Post by Savoir Faire-Demogague in NJ on May 24, 2011 14:12:23 GMT -5
If you're not getting a scholarship and you don't expect to be earning a high salary, you have a different college/career decision to make than someone who is a top 5% or even top 20% achiever.
Most HS grads dont get academic scholarships anyway. Where one graduates in their class is not really indicative of what they study in college nor what they earn. I graduated from my high school, a private school, at 162nd out of about 250. Went to college and I earn well over $100K.
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qofcc
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Post by qofcc on May 24, 2011 14:33:47 GMT -5
Most HS grads dont get academic scholarships anyway. Where one graduates in their class is not really indicative of what they study in college nor what they earn. I graduated from my high school, a private school, at 162nd out of about 250. Went to college and I earn well over $100K.
Sorry if that wasn't clear. I'm not talking about class rank at a particular school, I'm talking about overall academic achievement level in a pool of all graduates. The average student with a private school education is probably already ranked much higher in GPA and SAT/ACT scores than the average student in say, for instance East LA public HS.
But if you're the average C+/B- student planning to raise a family in an average LCOLA or MCOLA, chances are you're probably not going to end up with a 6 figure salary even if you do go to college, so you need to weigh the decision about which college/career path to take differently than someone who has a reasonable expectation of coming out a doctor or a lawyer or CPA and having no trouble earning enough to easily pay back their student loans.
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Post by illinicheme on May 24, 2011 14:38:00 GMT -5
Undergrad was definitely worth it for me. But I have one of those "marketable" degrees. YM approved!!!
Whether grad school was financially worth it is another question entirely. I didn't pay anything to go, and the PhD is pretty much required for the kinds of positions that interest me in the industry I've selected, but the financial breakeven point of earning <$25k until age 26 is probably somewhere in my late 40s or early 50s.
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Firebird
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Post by Firebird on May 24, 2011 14:42:22 GMT -5
Going along with what qofcc just said, I think it's important to weigh the kind of person you are in this decision. Granted, that's a lot to ask of most 18 year olds - but it's still worth at least raising the question. Do you thrive in an academic environment? Are you likely to get high grades? Are you at least somewhat self-disciplined, or do you work better with someone telling you what to do all the time?
The last is especially important. I think a lot of college grads flunk out (or just don't do particularly well) because they're not used to budgeting their time wisely and working to a schedule under their own steam. They're used to having Mom and Dad and teachers breathing down their neck. Some people, absent that external pressure, need a little while before they learn how to create it internally.
My cousins are not academic fellows. They're both better of in the armed forces or working, IMO. The problem is that they're both stagnating at dead-end jobs at the moment. That's not a good life plan, and it's a horrid alternative to college.
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Post by Savoir Faire-Demogague in NJ on May 24, 2011 14:56:51 GMT -5
Sorry if that wasn't clear. I'm not talking about class rank at a particular school, I'm talking about overall academic achievement level in a pool of all graduates. The average student with a private school education is probably already ranked much higher in GPA and SAT/ACT scores than the average student in say, for instance East LA public HS.
You were clear. I had a low B. My SAT scores were 970.
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Post by Savoir Faire-Demogague in NJ on May 24, 2011 15:00:34 GMT -5
Why are you stacking the deck? My brother never got beyond a hs diploma, but he is technically brilliant, and has advanced through a 30 year career and now designs communication system cabling for offices. he's a consultant, and works directly with clients and vendors and makes about 90k.
Again, as someone mentioned previously... your brother is a rare, one in 10 million individual. Posters here keep presenting outliers. Tim Linsicum is a freak of nature. He should not be as good a pitcher as he is...but he is. He is an outlier. That is why he is called "The Freak".
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Firebird
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Post by Firebird on May 24, 2011 15:02:48 GMT -5
But the fact that we can all name outliers (that we actually know, i.e. not Bill Gates, actual people that are related to us) proves that they're not 1 in 10,000,000. They're rare, but not anywhere near THAT rare.
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wodehouse
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Post by wodehouse on May 24, 2011 15:06:24 GMT -5
tbird, your brother may have done this. But as SF says, he is one of the special people with drive and ability. Most people aren't so special (I'm not. or maybe I am since I drug myself up by my bootstraps). But this was difficult 30 years ago, and is only more so difficult now. New fields come (and old ones die off). When computers first came into the business world AT&T was turning teachers into programmers. Now the requirements for professional programmers more specialized and are set higher. All I am saying is that the days of unskilled labor with HS diploma only are long gone.
"You think he should be working at walmart because he didn't go to school?"
No. I did not say that. Please don't put words in my mouth.
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qofcc
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Post by qofcc on May 24, 2011 15:07:06 GMT -5
You were clear. I had a low B. My SAT scores were 970.
And apparently you beat the odds in the other way. The average student who ended up with an above average salary.
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Post by Deleted on May 24, 2011 15:07:36 GMT -5
DH topped out at around 80k with a H.S. diploma. He could have slowly earned his way to a greater income but it would have taken time. It was a great salary for someone without a degree but in his industry people change jobs a lot. He felt at a disadvantage when doing a job search. Yes, you can succeed without a degree but you have a lot more flexibility with one.
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thyme4change
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Post by thyme4change on May 24, 2011 15:07:44 GMT -5
Even if they are 1 in 100, that means that 99 in 100 took the "traditional" route of college.
College as a way to increase the liklihood of earning power seems a lot easier to me than hoping you are smart enough and get enough breaks that your work ethic will carry you there.
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Post by Savoir Faire-Demogague in NJ on May 24, 2011 15:08:35 GMT -5
But the fact that we can all name outliers (that we actually know, i.e. not Bill Gates, actual people that are related to us) proves that they're not 1 in 10,000,000. They're rare, but not anywhere near THAT rare.
So, I added one too many zeroes, perhaps two. Innate and gifted brilliance is rare. Fact is, for millions of everyday individuals, getting a college degree means making $20-40K more than they otherwise would earn per year, and a more interesting and stimulating job.
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Firebird
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Post by Firebird on May 24, 2011 15:16:02 GMT -5
Fact is, for millions of everyday individuals, getting a college degree means making $20-40K more than they otherwise would earn per year, and a more interesting and stimulating job.
And again, I am not arguing this point. But it leaves a lot of room for people that can make their own path another way.
There are people who NEED to go their own way. Part of the reason I left school was to prove to myself that I could handle life without that little piece of paper. I was way too dependent on the entire concept before I made that break.
And you know what? If I had graduated in the statutory four years without any changes from how I felt at the end of my sophomore year, I would probably have fallen on my face. At that point in my life, I DID think the degree was a magic bullet. I NEEDED to learn for myself that it wasn't.
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thyme4change
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Post by thyme4change on May 24, 2011 15:17:14 GMT -5
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wodehouse
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Post by wodehouse on May 24, 2011 15:18:41 GMT -5
illinicheme: "Whether grad school was financially worth it is another question entirely. I didn't pay anything to go, and the PhD is pretty much required for the kinds of positions that interest me in the industry I've selected, but the financial breakeven point of earning <$25k until age 26 is probably somewhere in my late 40s or early 50s."
I don't know, I'm tending to disagree that earning <25K until age 26 due to further education won't see breakeven until age ~50. The only real way to resolve would be to crunch the numbers. But I'm looking at this from my age of ~59 and 26 seems so young. I lost ~three years of income when I went back to univ to complete my BS and to obtain an MS. I have little doubt that I broke even within 10 years (I better crunch the numbers...), and have been far beyond the mark ever since.
I'm thinking that if it was something you wanted to do I'd go for it. I wanted to get a Ph.D. but got tired and...well, gave it up for all the reasons stated in the other thread on science/engineering. And in hindsight it was probably for the best overall.
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thyme4change
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Post by thyme4change on May 24, 2011 15:27:39 GMT -5
We all have to learn that for ourselves. But, I did it after I got the degree. And, after a few false starts, I had all the tools I needed to leap forward. I knew so very many people that said "College isn't the magic bullet, so I dropped out." And every year they were making $7/hour as an accounting clerk, and I was making double that. I wasn't any more hard working or smarter than they were - but I had the paper.
I know way more people that didn't figure it out until they were past the point of really leaping ahead. I out earn all of them - because they weren't in the club, and couldn't convince anyone to let them in. Granted, I'm in finance/accounting where there is a substantial culture of education. I don't know many people who are able to succeed in corporate accounting without a degree. There aren't as many paths you can take.
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Post by illinicheme on May 24, 2011 15:28:22 GMT -5
illinicheme: "Whether grad school was financially worth it is another question entirely. I didn't pay anything to go, and the PhD is pretty much required for the kinds of positions that interest me in the industry I've selected, but the financial breakeven point of earning <$25k until age 26 is probably somewhere in my late 40s or early 50s." I don't know, I'm tending to disagree that earning <25K until age 26 due to further education won't see breakeven until age ~50. The only real way to resolve would be to crunch the numbers. But I'm looking at this from my age of ~59 and 26 seems so young. I lost ~three years of income when I went back to univ to complete my BS and to obtain an MS. I have little doubt that I broke even within 10 years (I better crunch the numbers...), and have been far beyond the mark ever since. I'm thinking that if it was something you wanted to do I'd go for it. I wanted to get a Ph.D. but got tired and...well, gave it up for all the reasons stated in the other thread on science/engineering. And in hindsight it was probably for the best overall. I did a rough calculation at one point in the past based on the expected difference in salary and the lost salary that meant I couldn't invest much in my 20s. The salary difference between a starting PhD and a BS w/ 5 years experience was not particularly significant in my industry at the time I graduated. The potential upside of the PhD is higher, but I'm not sure it offsets the lost years of compounding interest in investments. Perhaps 50s is too long, but I'm pretty confident that in my situation, the breakeven point is at least in the 40s.
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wodehouse
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Post by wodehouse on May 24, 2011 15:31:58 GMT -5
illinicheme: point is well taken. And the market for PhD's (overall, not your specific field) may even diminish versus lower degrees. Unless the Doctorate wants to accept a lower-ranking position that doesn't really need that degree. (Still, it would be cool to be "Dr. So-and-so".)
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thyme4change
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Post by thyme4change on May 24, 2011 15:38:48 GMT -5
Not in finance. The "bosses" are too rigid. Maybe other areas have more open minds.
The best way to "make it" without a degree is usually by having your own business. That way you don't have to deal with the corporate schmucks who see things in black and white (self description there.) If you are entrepuenerial, a hard worker, and have a skill that the market needs - you can do really well.
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NomoreDramaQ1015
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Post by NomoreDramaQ1015 on May 24, 2011 15:41:26 GMT -5
no more working your way up from the mailroom?
It'd be test tube washing room here and the answer is nope, it even requires at least an associate's now.
It is easier to get hired internally than externally but it can take a LONG time to move up just by experience.
It's faster and easier to get the next highest degree.
I can increase my salary and jump up the ladder a lot faster with my master's than counting on my bachelors and current 5 years experience to get me there.
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