Filed by KOSU News in Education.
June 22, 2011

PIMCO’s Bill Gross jumps on the college-bashing bandwagon in his latest note.

A mind is a precious thing to waste, so why are millions of America’s students wasting theirs by going to college? … Students … can no longer assume that a four year degree will be the golden ticket to a good job in a global economy that cares little for their social networking skills and more about what their labor is worth on the global marketplace.

It’s true that college is not a “golden ticket to a good job.” But it makes a huge difference.

In 2010, the unemployment rate for college grads age 25-34 was 4.9 percent; the rate for those with only a high school degree was 13.7 percent. The gap was wider than it’s been at any point in the past decade.

It’s also true that, as Gross notes, the price of college has been rising much faster than inflation for decades. But the income gap between high-school and college grads has also been growing (largely because, after accounting for inflation, income has actually fallen for people with only a high school degree).

So a college degree is in fact worth more than it used to be. Gross alludes to this in passing as a “bump in earnings.” But it’s a very, very big bump. This graph shows how the full-time, full-year earnings gap has grown since 1980.

For More:

From Planet Money:

“Is A College Degree An Insurance Policy?”

“How Much Is A College Degree Worth? Depends On Your Major”

“3 Reasons Why College Is So Expensive”

From NPR:

“Making Headlines Since The ’70s: Is College Worth It?”

“College Student Debt Grows. Is It Worth It?”

[Copyright 2011 National Public Radio]