China and America Suffer from Common Ailment
It's rare that two behemoths so different in many ways are so alike in one particular area. I'm referring to how both China and the U.S. are deluded about the value of a four-year college degree.
China is learning the hard way about the price of its obsession. In 1998, colleges and universities there turned out 830,000 graduates a year. Last May, the number had climbed to more than six million. Ordinarily, this increase would be seen as laudable. But China's economic growth, as impressive as it is, simply cannot provide enough good jobs for the graduates ("China's Army of College Graduates Struggles for Good Jobs," New York Times, Dec. 12).
The irony is that workers with a trade but without a college degree are in demand, while those with a sheepskin are barely eking out a living. If they are lucky, they find jobs that they could easily have performed without investing so much time, energy and money. Feeding the problem is the growing number of third-tier colleges that impresses no one.
An eerily similar scenario is playing out in the U.S. The Obama administration is encouraging all students to go to college, arguing that the median earnings for those with a bachelor's degree are 74 percent higher than for those who possess only a high school diploma. But this argument fails to take into account a host of factors.
According to Alan Blinder, former vice chairman of the Board of Governors of the Federal Reserve, the only jobs that will be safe in the next decade will be those that cannot be electronically offshored. If he is right - and I believe he is - then auto mechanics, plumbers and electricians will be working steadily at well paying jobs while their degreed peers will be on the unemployment line.
Too many students are also going into heavy debt to enroll in for-profit colleges that promise far more than they deliver in terms of jobs. These institutions are rightly under investigation for unethical and illegal practices. Yet enrollments have leapt 20 percent in the last few years, as desperate people seek to gain skills or polish their resumes.
Even students who enroll in traditional colleges are not spared from assuming onerous debt. Their monthly payments vitiate the wage premium attached to a four-year degree. By law, declaring bankruptcy does not wipe out student loans, which follow graduates to their graves.
Faced with the harsh reality of the job market, more and more college graduates in both China and the U.S. are finally forced to move back home because they cannot afford the cost of rent on the paltry wages they earn doing work that they are overqualified for.
The one major difference is that the U.S. has a dismal college-completion rate. Almost 70 percent of high school graduates enroll in college within two years of receiving their diploma, but only 57 percent who enroll in a bachelor's degree program graduate within six years. In China, the college graduation rate is 97 percent, although no breakdown of this figure is available.
What both countries need to realize at this crossroads is that college is not for everyone. That's why I've long urged high schools to give vocational education the respect it deserves. Doing so would serve students far better than the present policy. But don't count on the U.S. being able to kick its college addiction. There is too much money to be made by keeping young people hooked on the habit.