Trending Topics

Is a College Degree Worth It? College Degrees Lose Luster as Inflation Surges and Student Debt Balloons

By Paulina Cachero

Sam Wren didn’t even consider going to college.

The 18-year-old from Utah said the decision was a no-brainer when he compared the nearly $90,000 cost of a four-year degree at Utah State University — his mother’s alma mater— against a two-year trade school program for under $10,000.

Photo by Joshua Mcknight: https://www.pexels.com/photo/smiling-woman-1139319/

“It’s such an expensive commitment to make,” said Wren, who will enroll in a trade school in the fall. “I don’t want to be somebody who’s in debt right out of the gates just trying to start a career.”

High schoolers and their parents are increasingly questioning whether a traditional four-year college education is the right financial decision, with rising costs often resulting in crippling student-loan debt.

In a recent poll by Gallup, 46% of parents said they would prefer their child pursue something other than a bachelor’s degree, and more than one-third cited finances as an obstacle. Meanwhile, just 56% of adults under age 30 who went to college said the benefits of their education outweighed the costs, according to a Federal Reserve study.

This growing disillusionment is showing up in enrollment data. The number of students registered in undergraduate programs plummeted during the pandemic and continues to fall, defying expectations for a rebound as in-person learning resumed. There were more than 662,000 fewer students registered in spring 2022, a 4.7% drop from the year prior, according to the National Student Clearinghouse.

To be sure, college is still worth it for families that are able to help their kids pay for their education. Overall, a bachelor’s degree increases a person’s lifetime earnings by 75% compared to someone who only obtained a high school diploma, according to research from the Georgetown University Center on Education and the Workforce.

A college education also typically increases a graduate’s job options. However, that’s beginning to change in the tightest labor market in decades. Many sectors are opting to relax or scrap occupational licensing and college-degree requirements altogether, and jobs that don’t require a degree have seen wages jump as employers battle for workers.

E.C. Crippen, a 38-year-old hairdresser in Tennessee, believes that opting for a professional license over a bachelor’s degree was one of the best decisions he made. After dropping out of a state university more than a decade ago, Crippen spent about $10,000 to enroll in a 10-month program at the Tennessee School of Beauty in Knoxville. Now, he rakes in $120,000 a year— an annual salary that is comparable to or even higher than what people his age with a bachelor’s degree typically earn.

“I definitely feel like I have received tenfold what I put into my education,” Crippen said. “And I have a job that I love.”

Rising Costs

Costs for full-time undergraduate students have been on the rise for decades: the average sticker price for tuition and fees at a private college was $38,070 in the 2021-22 academic year, while the cost for an in-state public school was $10,740. Both of those are nearly double or more what they were 30 years ago, data from the College Board show.

That’s forced younger generations to go deeper into debt, with public-school graduates borrowing an average of $30,030 for a bachelor’s degree at a public school, according to the Education Data Initiative.

Some graduates are discovering their costly education isn’t paying off like they expected — even for Ivy League degrees.

Gregory Lowry, a 26-year-old teaching coach, graduated from Brown University with $165,000 in student loan debt for a degree in chemistry and anthropology.

He originally planned to go to medical school, justifying the $66,000 undergraduate annual tuition. But by the time he graduated, he realized his true calling was education. Had he discovered his passion earlier, Lowry said he likely would have chosen a different school and degree that would have resulted in less debt.

Now, he makes a point to tell his students about alternate pathways after high school that make financial sense for their families.

“It’s really important for people to have time to experience what they need to before jumping into a $100,000 decision,” he said. 

Alternate Paths

Gallup found that one-third of parents who went to college themselves don’t want their children to do the same. That’s especially true for parents who found that their degrees didn’t help them earn a living, like Sam’s mother, 44-year-old Cynthia Wren.

Unable to find steady work with her dual bachelor’s degree in tech writing and history from Utah State University, the mother of three later went back to a community college to become an occupational therapy assistant. Still paying off her loans for both her associate’s and bachelor’s degrees, Cynthia worries that her kids will also be saddled with debt.  

“I’m not ruling out college, but to be honest my four-year degree has done far less for me than my associate’s degree of applied science,” she said. “The job field has changed a lot in terms of being able to successfully pay it back.”

More stories like this are available on bloomberg.com.

Back to top