Fighting the forces of un- and underemployment

Recent college grads today face some of the worst job prospects since the great depression. A survey by the Associated Press found that over 50 percent — about 1.5 million — are either unemployed or in jobs that don’t require a college degree. The AP survey found that recent grads were “more likely to be employed as waiters, waitresses, bartenders, and food-service helpers than as engineers, physicists, chemists, and mathematicians combined. There were more working in jobs such as receptionists or payroll clerks than in all computer professional jobs. More also were employed as cashiers, retail clerks, and customer representatives than engineers.” (Quote from op-ed piece by Raghav Singh at ere.net).

Singh goes on to point out:

Underemployment and unemployment varies a great deal depending on the major. Not surprisingly, students who graduated with degrees in the sciences or other technical fields, such as accounting, are much less likely to be jobless or underemployed than humanities and arts graduates.

He adds that about a third of all college students major in fields that have very poor job prospects.

Two More Colleges to Merge

Inside Higher Ed reports the merger of another two private nonprofit colleges in the South: Point University (Georgia) and Montreat College (North Carolina). This follows the announcement of the merger of two other Southern colleges (Johnson University and Florida Christian College) earlier this year (see this post).

These steps hold out the promise of strengthening all the institutions and lowering costs for students. Of course, it all comes down to execution. Mergers also can go awry.

Alternatives to the traditional college path

Less than 20 miles south of where I live at the foot of the Rocky Mountains in Colorado resides a guy who goes by the name Mr. Money Mustache (MMM). According to his blog, “Mr. Money Mustache is a family man living in the United States who retired from work, relatively wealthy, at about age 30. After several years of retirement, he noticed that his still-working peers were envious of his lifestyle. They were making more money than he ever had, yet they were somehow still broke. So he decided to write this blog to educate the world on how it is done.”

I recommend his blog to anyone who is interested in an alternative path that doesn’t involve a lifetime of acquiring things and working to pay off the debt. But today I want to highlight last Thursday’s post titled 50 Jobs over $50,000 — Without a Degree (Part 1). 

The students colleges really want

One of the most distasteful aspects of the pricing strategy followed by nearly all private nonprofit colleges and many public colleges is that needy  kids often end up paying more than their affluent classmates. Sallie Mae’s annual report, “How America Pays for College” (the subject of this post), provides further confirmation. Here is how BloombergBusinesweek describes the findings on this point:

Is your college going broke?

This is the question posed by Matt Schifrin in his excellent article in the August 13 edition of Forbes magazine (here).

Schifrin correctly observes, “By far the biggest problem at most colleges is that they are governed in a way that flies in the face of sound business practices. The vast majority of colleges in the U.S. are bloated with personnel and programs that make little economic sense.”

Judging a College’s Financial Health

Schifrin goes on to quote my friend Lucie Lapovsky, a respected higher ed consultant and former college president and V.P. of finance, who cautions students and their families not to ignore the signs of financial distress when considering colleges. “Visible signs of financial stress can include fewer classes offered less frequently, more classes taught by adjunct professors, less money for clubs and cutbacks in the upkeep of campus facilities,” says Lapovsky.

I mentioned other warning signs in this earlier post.

What and how families pay for college

The above charts are from the Pew Research Center. Go here for the related article.

Good colleges in attractive cities

A reader asked for suggestions on really good colleges located in cities. I thought I’d share the list of colleges I provided. I left out the so-called elites, as they are well known to most people; instead, I focused on what I’d consider tier 1A or tier 2 schools. Here is the list (in no particular order), with some sketchy commentary:

Students pay for colleges’ extravagance

College and university administrators, and boards, don’t seem to appreciate the value of money. Or perhaps they’re just insensitive to the value of other people’s money. Whatever the reason, the evidence is overwhelming that many of them have extravagant habits. And, of course, this extravagance contributes to the high cost of college, a cost borne not only by students and parents but also by all taxpayers in the form of massive public subsidies (grants, tax exemptions, tax credits and deductions, etc.). The City University of New York (CUNY) provides the latest example.

Are you thinking of melting away this summer?

“Melt” is what colleges call the loss of new students over the summer. For instance, a college might have 1,000 deposits on hand from newly admitted freshmen in May only to find that 100 (10% of the total admitted, deposited applicants) choose not to show up in August. The 10% is called the melt. Are you thinking of being one of them?

College enrollment boom is over. What’s it mean for students?

Richard Pérez-Peña wrote in the New York Times (here) that:

The long enrollment boom that swelled American colleges — and helped drive up their prices — is over, with grim implications for many schools. College enrollment fell 2 percent in 2012-13, the first significant decline since the 1990s, but nearly all of that drop hit for-profit and community colleges; now, signs point to 2013-14 being the year when traditional four-year, nonprofit colleges begin a contraction that will last for several years.