Members of the Class of 2012,
As a former secretary of labor and current professor, I feel I owe it to you to tell you the truth about the pieces of parchment you’re picking up today. You’re f*cked.
Well, not exactly. But you won’t have it easy.
First, you’re going to have a hell of a hard time finding a job. The job market you’re heading into is still bad. Fewer than half of the graduates from last year’s class have as yet found full-time jobs. Most are still looking.
That’s been the pattern over the last three graduating classes: It’s been taking them more than a year to land the first job. And those who still haven’t found a job will be competing with you, making your job search even harder.
Contrast this with the class of 2008, whose members were lucky enough to get out of here and into the job market. Almost three-quarters of them found jobs within the year.
You’re still better off than your friends who didn’t graduate. Overall, the unemployment rate among young people (21 to 24 years old) with four-year college degrees is now 6.4 percent. With just a high school degree, the rate is double that.
But even when you get a job, it’s likely to pay peanuts.
Last year’s young college graduates lucky enough to land jobs had an average hourly wage of only $16.81, according to a new study by the Economic Policy Institute. That’s about $35,000 a year. The typical wage of young college graduates dropped 4.6 percent between 2007 and 2011, adjusted for inflation.
Presumably this means that when we come out of the gravitational pull of the recession your wages will improve. But there’s a longer-term trend that should concern you.
Don’t get me wrong. A four-year college degree is still valuable. Over your lifetimes, you’ll earn about 70 percent more than people who don’t have the pieces of parchment you’re picking up today.
But this parchment isn’t as valuable as it once was. So much of what was once considered “knowledge work” – the kind that college graduates specialize in – can now be done more cheaply by software. Or by workers with college degrees in India or East Asia, linked up by Internet.
For many of you, your immediate problem is that pile of debt on your shoulders. In a few moments, when you march out of here, those of you who have taken out college loans will owe more than $25,000 on average. Last year, ten percent of college grads with loans owed more than $54,000. Your parents have also taken out loans to help you. Loans to parents for the college educations of their children have soared 75 percent since the academic year 2005-2006.
Outstanding student debt now totals over $1 trillion. That’s more than the nation’s total credit-card debt.
The extraordinary rise in student debt is due to two related facts: the cost of a college education continues to increase faster than inflation, and state and local spending per college student continues to drop – this year reaching a 25-year low.
But this can’t go on. If unemployment stays high for many years, if the wages of young college grads continue to fall, if the costs of college continue to rise, and if the college debt burden therefore continues to explode – well, you do the math.
At some point in the not-too-distant future these lines cross. College is no longer a good investment.
That’s a problem for you and for those who will follow you into these hallowed halls, but it’s also a problem for America as a whole.
You see, a college education isn’t just a private investment. It’s also a public good. This nation can’t be competitive globally, nor can we have a vibrant and responsible democracy, without a large number of well-educated people.
So it’s not just you who are burdened by these trends. If they continue, we’re all f*cked.[Snip]
Yes, Mr. Secretary, you may be right of the plight of the Class of 2012. But you fail to mention your part in the situation they face.....like your administration, the Clinton administration to be exact, with your blessing partook in the largest transfer of American (military and industrial) high technology to the world, costing us high wage jobs needed to remain a world leader. And your guy Obama's economic policies have stifled growth and do nothing to create jobs of any kind here for highly educated graduates, much less a common man. Yes Mr. Secretary, we're all F*ck as you say, as long as debt continues to pile up, and we spend more as you recommend.
As for the price of an education, there's not enough room here to rant about expensive universities paying stables of professors absorbent amounts of money to write books and columns instead of the teaching they were hired to do.........
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