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Gen Z is giving up on college

businessinsider.nl

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Re: Gen Z is giving up on college

#131

Post by candybar »

dahart wrote: post #18

> Four years after graduating, according to recent data from the Higher Education Authority, a third of students earn less than $40,000 — lower than the average salary of $44,356 that workers with only a high-school diploma earn. Red flag here, this seems like a super misleading and bogus comparison. There is no good reason to compare the bottom third of graduates to the whole pool of non-graduates other than to try…

It's even worse than that - $44,356 is the median salary for high school graduates aged 25 or over with a full-time job (it's extrapolated from the median weekly wage of $853) in 2022:

https://www.bls.gov/careeroutlook/2023/data-on-display/educa...

It's unclear exactly what qualifications apply to "a third of students earn less than $40,000" - I was not able locate an actual source for this claim - but the way it's written, it appears to include everyone, possibly even those that are not in the workforce at all. Also, given a huge increase in nominal income over the past couple years, it's difficult to evaluate this claim without a clear sense of what time frame this covers.

It's also unreasonable to compare college graduates 4 years after graduation to a cohort that includes mid-career professionals decades into their career. Consider for instance, how much doctors tend to make 4 years after graduating from college and how unrepresentative that would be of their full career earning potential.

Re: Gen Z is giving up on college

#132

Post by dahart »

candybar wrote: post #131
dahart wrote: post #18

> Four years after graduating, according to recent data from the Higher Education Authority, a third of students earn less than $40,000 — lower than the average salary of $44,356 that workers with only a high-school diploma earn. Red flag here, this seems like a super misleading and bogus comparison. There is no good reason to compare the bottom third of graduates to the whole pool of non-graduates other than to try…

It's even worse than that - $44,356 is the median salary for high school graduates aged 25 or over with a full-time job (it's extrapolated from the median weekly wage of $853) in 2022: https://www.bls.gov/careeroutlook/2023/data-on-display/educa... It's unclear exactly what qualifications apply to "a third of students earn less than $40,000" - I was not able locate an actual source for this claim - but the way it's w…

It’s pretty bad, right? Is it possible for this to be an accident on the part of the author? I don’t see how. It seems like a clear case of bending over backwards to distort the data to tell a summary story that is opposite from the truth. This intentionally misleading comparison undermines the entire article, to me. I’m curious about why they’re trying so hard to spin the yarn that college isn’t worth it, when the data they had to look through in order to write this story demonstrates a somewhat different narrative.

Re: Gen Z is giving up on college

#133

Post by squokko »

dahart wrote: post #130
squokko wrote: post #103

Earlier quoted context omitted.

The only people making a real decision are the people on the border. The valedictorian is always going to college and the lunkhead is not. The only useful analysis is the one in the middle.

Real lunkheads don’t graduate high school, they were already excluded. The argument you’re offering is at some level explaining why college grads earn more, and you’re suggesting it’s because they were better prepared for college, more likely to choose it, able to afford it, etc. That is true. But your reasoning does not justify the comparison that was made in the article, nor does it explain why it’s valid. The stat…

The middle third of high school grads are not a similar group of people to the middle third of college grads. It's the top third of HS grads and the bottom third of college grads that are comparable people (top in the sense of academic potential, not income potential).

Re: Gen Z is giving up on college

#134

Post by HDThoreaun »

Mistletoe wrote: post #127
xboxnolifes wrote: post #29

Earlier quoted context omitted.

> 80k invested at 18 and getting 10% returns like in the stock market is $1 million at age 45. At 65 it’s $7 million dollars. The math on college doesn’t even beat the stock market. This isn't the alternative for most people. There isn't an option to get a mix of 80k in federal and non-federal students loans to throw into the stock market. The real question is, for most people, does it make sense to take on ~80k in s…

No one said 10% real returns. It’s 10% counting inflation, which is the number I provided. > The average stock market return is about 10% per year for nearly the last century, as measured by the S&P 500 index. I don’t know why people are getting hung up on this 10%, it’s just the historic returns everyone in Boglehead and FI/RE communities uses. If you wanted to use the 6-7% real returns after inflation that is fine…

I get hung up because the last century was by far the best economic century for humans ever, and it seems reasonably likely that the next will not be as good growth wise.

Re: Gen Z is giving up on college

#136

Post by dahart »

squokko wrote: post #133
dahart wrote: post #130

Earlier quoted context omitted.

Real lunkheads don’t graduate high school, they were already excluded. The argument you’re offering is at some level explaining why college grads earn more, and you’re suggesting it’s because they were better prepared for college, more likely to choose it, able to afford it, etc. That is true. But your reasoning does not justify the comparison that was made in the article, nor does it explain why it’s valid. The stat…

The middle third of high school grads are not a similar group of people to the middle third of college grads. It's the top third of HS grads and the bottom third of college grads that are comparable people (top in the sense of academic potential, not income potential).

Why do you believe that? And more importantly, where is the data to back it up? It’s more likely that the top third of high school grads are more capable than the bottom third of college grads. Regardless, the report I just linked to accounts for this.

Re: Gen Z is giving up on college

#138

Post by dahart »

acchow wrote: post #72
dahart wrote: post #18

> Four years after graduating, according to recent data from the Higher Education Authority, a third of students earn less than $40,000 — lower than the average salary of $44,356 that workers with only a high-school diploma earn. Red flag here, this seems like a super misleading and bogus comparison. There is no good reason to compare the bottom third of graduates to the whole pool of non-graduates other than to try…

The correlation is there, but do we know this is causation in the implied direction? It seems to me that anyone who comes from an upper-middle class educated family would actually make a lot more by not going to college.

See the full report, which answers this question. https://news.ycombinator.com/item?id=37464064

Re: Gen Z is giving up on college

#139

Post by dahart »

oliwarner wrote: post #95
dahart wrote: post #18

> Four years after graduating, according to recent data from the Higher Education Authority, a third of students earn less than $40,000 — lower than the average salary of $44,356 that workers with only a high-school diploma earn. Red flag here, this seems like a super misleading and bogus comparison. There is no good reason to compare the bottom third of graduates to the whole pool of non-graduates other than to try…

Does that study cover what their parents were worth before they decided to go into higher education or not? Some families can't afford for their kids to leave home —they might be carers, they might have jobs— even before you consider $100k of debt. If it's really just richer people in, richer people out , it's hardly surprising the median salaries are split. I'm not questioning whether or not higher education has val…

Yes, the background question is addressed. https://news.ycombinator.com/item?id=37464064

Re: Gen Z is giving up on college

#140

Post by dahart »

knallfrosch wrote: post #116
dahart wrote: post #18

> Four years after graduating, according to recent data from the Higher Education Authority, a third of students earn less than $40,000 — lower than the average salary of $44,356 that workers with only a high-school diploma earn. Red flag here, this seems like a super misleading and bogus comparison. There is no good reason to compare the bottom third of graduates to the whole pool of non-graduates other than to try…

> Red flag here, this seems like a super misleading and bogus comparison. I don't think so. It's still a 1 in 3 chance of earning less with a college degree than without. It's useful to show how much overlap there is. You could also argue that the bottom third of college graduates might also be the bottom earners without a degree, but at some point, you have to work with the real numbers that you do have, instead of…

It would be fine if they had summarized it as a minority 1/3 chance of earning less. It would be fine if they had compared the overall averages, where college grads earn more, and then compared the bottom third of college grads. But the story is trying to justify a summary point suggesting that college isn’t worth it, which justifies the title that Gen Z is giving up on college. The issue is that they didn’t point out that outcomes for college grads on average are quite a bit better, and that it’s only a minority of the time that things don’t work out as well for degree holders (and always has been only a minority of the time.) They didn’t explore the reasons behind the bottom third’s performance, and the comparison is more misleading than the parts I pointed out: https://news.ycombinator.com/item?id=37468176
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