Some pundits have argued in recent years that higher education is another financial bubble. Rumored to be worth more than it actually is, so the thinking goes, too many people enroll in college, more than can actually afford to be there.
No, it’s not a bubble, writes Anya Kamenetz at Fast Company. Kamenetz explains that the college degree is still very valuable because,
College degrees are still relatively scarce in the U.S. Less than 30 percent of the population have BAs, and we’re 12th in the world in the rate of young workers that have associate’s degrees or more. President Obama’s goal is to increase the percentage of young people with some kind of postsecondary certification to 60 percent.
Global demand for education keeps growing—it’s on track to double over the next 10 years, to over 225 million students worldwide. According to UNESCO, India would have to build a new campus every two weeks between now and 2025 just to meet the demand.
So college isn’t a bubble; it’s just expensive, Kamenetz maintains. Well, except for some kinds of college:
The place the college-is-a-bubble meme might do some good is in the for-profit education sector. Dogged by persistent allegations of financial fraud and misleading recruitment practices, as well as increasing regulatory pressure from the federal government, the industry, a darling of the venture market just three years ago, has been weathering diving stock prices over the past year. These colleges, which enjoyed a decade of soaring enrollment with little or no oversight into the quality of education they provide, really do deserve the title of subprime.
Can’t say we didn’t warn you.
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