College is the hot topic of the moment. I'm in a rush this morning, so I'll just sum up the items of interest du jour.
In addition to some groundbreaking reporting on this morning's Today Show about a 40 pound cat and the sex life of Simon Cowell, they discussed the miserable job report for recent college graduates. 53% of recent college grads are unemployed or underemployed. Best links: The Atlantic and the AP.
Steve Salzberg of Forbes reports on the decision of the University of Florida to eliminate its computer science department, while increasing the athletic budget. This piece was passed around my Twitter circle heavily. Alex Tabarrok of Marginal Revolution wrote a post on it, and his commenters explained that outside of the NE, college sports are hugely important to Americans and bring in big bucks for the university.
Ezra Klein writes that there is bipartisan support for extending the College Cost Reduction and Access Act, but Congress is dithering. If they don't act soon, the interest rate for college loans is going to jump from 3.4 percent to 6.8 percent.
Somewhat related to higher ed is a column by David Brooks, which is a riff on a Peter Thiel argument that our education system and business world are too caught up with competition. To really succeed, one needs to find a niche, specialize, and create a monopoly. Dan Drezner responds.
Blogs and video games improve education, according to the Brookings Institute.
Apt. 11d 
college sports are hugely important to Americans and bring in big bucks for the university.
I think that this is at least highly disputable, with perhaps a few exceptions. (Not that college sports are hugely important to many Americans, but that they bring in big bucks for the universities.) My understanding is that, over all, for the majority of universities, they are a wash or a small negative once everything is worked in cost-wise. (That is probably under-counting many costs, too, that are harder to figure.) Most football teams, for example, don’t make money, if I recall correctly, and that’s the only sport that tends to make a lot of money. So, I suspect that people are wrong on this.
Is there a typo of some sort in your figures in the last bit? I don’t quite understand the claim.
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Oops. yes, a typo. I’ll fix it. Thanks, Matt.
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No problem- I thought that it was probably just switched around, but though there might be something deeper that I was missing. That’s a big difference, so let’s hope people get their act together.
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“My understanding is that, over all, for the majority of universities…”
But isn’t the question how much University of Florida makes, not “the majority of universities”? Also, I wonder if they’re figuring in college merchandise, too (sweatshirts, t-shirts, sweat pants, ball caps, water bottles, coffee mugs, etc.). For big state schools (or private schools with well-known teams), the sales of that sort of item have to be largely driven by the fortunes of the athletic franchise.
Also, it’s traditional that a good year in athletics drives up applications (not sure about quality).
“Ezra Klein writes that there is bipartisan support for extending the College Cost Reduction and Access Act, but Congress is dithering. If they don’t act soon, the interest rate for college loans is going to jump from 3.4 percent to 6.8 percent.”
I seem to remember that at least some of my federal undergrad loans from the 1990s were at 8%. That’s not at all monstrous when borrowing to buy something that the bank cannot foreclose on. It’s kind of crazy to lend money for education at the same rate (or lower) as for a mortgage.
At least in housing, the effect of low interest rates has been to inflate house prices or to keep house prices from falling. It may well be that low student loan rates are contributing to exploding tuition rates.
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But isn’t the question how much University of Florida makes, not “the majority of universities”
Sure, except that Florida has to play someone, and if most of the other schools loose money on athletics (in addition to other drawbacks that focusing so much on them might have) it’s not clear why those other schools should subsidies the few that make money.
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Football is a profit center to a huge number of universities, including Florida. It isn’t the majority of universities, but certainly there would be no trouble to fill a 13 game season.
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Am I right in thinking that if it’s U Name of State or Name of State State U, they’re probably raking it in on football?
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College sports are hugely important to lots of people in the Northeast too. Admittedly, the Yale-Harvard or Amherst-Williams games don’t attract so much press attention, but they are certainly hot topics among the dads on the soccer sidelines or the diners at the Union Club.
The major difference is that the top schools (i.e., the Ivy League and NESCAC) have entered into arms reduction pacts, so to speak, so they don’t spent as much money but have a level playing field.
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Getting mathy about underemployed grads, because I’m seeing a lot of facts, and having problems thinking about them.
Fact #1:
About 1.5 million, or 53.6 percent, of bachelor’s degree-holders under the age of 25 last year were jobless or underemployed,
Fact #2:
In 2000, the share was at a low of 41 percent,
Fact #3:
According to the Census, the number of Americans under the age of 25 with at least a bachelor’s degree has grown 38 percent since 2000.
From Facts 1 and 3, I conclude that there were just over 2M grads under 25 in 2000, and exactly 2.8M now. (1.5M is 53.6% of 2.8M, 2.8M is 40% more than 2M, so between 2M and 2.1M in 2000).
From that we can conclude:
2000: 2M graduates/ 1.18M employed/ 820K unemployed or underemployed
2012: 2.8M graduates/ 1.3M employed/ 1.5M unemployed or underemployed.
The 2010 census showed a 9.7% increase in US population since 2000, so the increase in jobs (1.18M to 1.3M) is roughly comparable to the population increase (and pretty good since we’re measuring from peak to just-after-trough).
It looks like the “problem” is that of those extra 800K who went to college, there were only college-level jobs for 100K of them.
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“It looks like the “problem” is that of those extra 800K who went to college, there were only college-level jobs for 100K of them.”
That is very interesting.
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Of course, we were assuming that in 2000, at the height of the dot-com boom, “the share was at a low of 41 percent” of college grads unemployed or underemployed was NOT a problem. But it seems like of problem-y to me.
I wonder what happened to them. Did those 800K people ever get out of Starbucks and start doing grad-level work? Or are there 800K coffee shops, all with a lifer barista?
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Certainly some portion of the college grads in non-college jobs are people who had jobs and went to college part-time. Now they are in a position to put in for promotions at work and/or look for a new position, but they may not feel much urgency. In short, don’t think English major from Colby, think secretary who is now eligible to become a marketing assistant when a position opens up in that department.
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y81 — I don’t think so. The stats are limited to “college grads under 25.” If full-timers finish at age 22, I don’t think the numbers are catching too many part-timers. The secretary who works full time and goes to college at night is probably older than 25 when she finally gets her degree.
I think Colby might be producing too many English majors.
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Ragtime – Thanks for the interesting research.
“If [congress doesn’t] act soon, the interest rate for college loans is going to jump from 3.4 percent to 6.8 percent.”
These educational loans are unsecured (i.e. no physical asset backs them) but at the same time can’t be discharged in bankruptcy. So what is their proper market interest rate? No clue. No equivalent loan product exists.
But there’s no doubt that it represents a very large subsidy of the higher education system by the Federal government.
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Ragtime: Hmm, you may be right. But I would like to see a little more detail, to know what to make of this statistic. How many of the people with non-college jobs are graduates of full-time programs who obtained their current, non-college job subsequent to graduation? That is the type of person one visualizes, but it may not be representative.
I doubt my life is typical, but after I graduated from college I worked as a stablehand while thinking about what to do (and preparing law school applications). If I hadn’t gotten into law school, I probably would have found something that paid better than cleaning stalls.
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Just a note that closing comments on blog posts decrease the opportunities for public apologies from those who feel that they were unnecessarily piling on, and trying to speak overly objectively about issues that are often best not looked at purely objectively.
Sorry.
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Can we talk about the 1.5% plan? The plan that’s landing in my mail box:
“Attend their local community college or a state public university, tuition-free. In exchange, a legal quid pro quo: the student contributes 1.5 percent of their income, if they attended community college, or 4 percent if they attended a university, for 25 years.”
http://www.heraldnet.com/article/20120425/OPINION04/704259985/-1/OPINION#A-new-idea-for-expanding-college-access
Would you agree to a 4% increase of your income tax for 25 years in order to attend your state college?
Laura, did you say that you were going to talk about plan at some point?
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y81 said:
“I doubt my life is typical, but after I graduated from college I worked as a stablehand while thinking about what to do (and preparing law school applications).”
I think it’s pretty normal to have non-professional jobs right after college, hence the figure that said that even during a boom (2000), the rate of unemployment/underemployment was 41%.
I applied for EVERYTHING after I got my MA. It was a bit of a confidence-crusher to not get a job at Einstein’s Bagels or Princeton Review. However, within about 9 months (i.e. the usual start of the academic year), I had as many teaching and translating jobs as I could stand.
bj quoted:
“Attend their local community college or a state public university, tuition-free. In exchange, a legal quid pro quo: the student contributes 1.5 percent of their income, if they attended community college, or 4 percent if they attended a university, for 25 years.”
So that’s one year’s salary for a university. Would that apply even if you spent 7 years getting your 4-year degree? For just 4 years it sounds pretty fair for everybody, but I think people who took the deal would gripe a lot about it before the 25 years was up.
I’m not sure the price ratio for CC vs. university reflects the real world gulf between CC and university degrees, unless we’re talking about highly lucrative vocational CC programs. A standard CC degree is not worth 3/8 of a university degree.
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Now that I think of it, my grad-seeking-employment story was from 2000.
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No worries. Nothing that I haven’t heard before. Still, needed to gain some distance today.
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