The sun is rising on a new academic year. Fall classes will commence on August 28. With that, the Lehman College campus will again come to life in a way that is only possible when it is bustling with academic and student life activities.
As is an annual ritual of fall, a new cohort of students will be entering the campus. At the same time, those from earlier cohorts will be returning.
Unfortunately, some from earlier cohorts will not be returning, even as they have not yet earned their degree. For the most recent three years for which data is available, an average of nearly 20% of first-time, full-time freshmen and almost 30% of transfer students failed to return for their next year of study.
Whenever a student fails to return, it is bad for the college in terms of academic activity, student life, and finances. It is terrible for the student. In today’s economy, employment growth is increasingly centered on knowledge- or information-intensive fields. With the nation’s aging population, demand for professionals in such fields as health sciences is projected to increase substantially. Most of the areas in which employment growth is concentrated require a Bachelor’s degree as a starting point. Failure to attain a college degree creates an insurmountable entry barrier to those industries. In the larger context, it deprives one of flexibility to lead a more prosperous and secure life.
Bureau of Labor Statistics data consistently reveal far lower unemployment rates and much greater job security for college graduates. Even during the depths of the Great Recession, the unemployment rate for college graduates was substantially less than that for those without a degree. Below is employment and earnings data for 2012:
My advice to new students and returning students is that one should understand that the pursuit of a college degree is not always a smooth process. Invariably, many are faced with issue that could threaten one’s college enrollment at one time or another.
If you are faced with such an issue, do not succumb to that temptation. In most cases, yes most cases, the issues of the day that threaten one’s continuation at college are small compared to what one risks giving up in deciding not to return to college.
For those who have taken a basic finance course, there is a concept of net present value that provides a useful tool for evaluating projects. In assessing a project, one compares all the expense and income related to the project over the lifetime of that project’s utility. In doing so, one applies a discount factor to account for the time value of money. Even in today’s era of low inflation, a dollar tomorrow is worth a little less than a dollar today. That approach provides a disciplined framework for rationally evaluating choices. Whether or not to withdraw from college is a choice and it should be evaluated with at least similar discipline.
For illustrative purposes, the above earnings and employment chart indicated that workers with a Bachelor’s degree had median weekly earnings of $1,066. Those with some college exposure, but no degree (college dropouts) had median weekly earnings of $727. Assume a scenario with a 2% inflation rate (the Fed’s goal for price stability) and a continuation of the median weekly earnings through a 40-year career. The worker with a Bachelor’s degree would have lifetime present value earnings of $485,000 more than the one who quit college. In other words, in today’s dollars, he or she would have earned almost a half-million dollars more than the one who left college without a degree. In reality, the figure would likely be larger, as earnings rise through one’s career, the worker with the Bachelor’s degree would have more employment choices and opportunities for career advancement, and greater employment security (reduced incidence of unemployment).
Of course, this quick sketch does not consider additional non-financial sacrifices. For example, the reduced lifetime earnings could translate into one’s residing in a neighborhood where the schools and overall quality of life is less than what otherwise might have been the case. In turn, that could translate into less educational opportunity and the associated costs of that outcome for one’s children.
Without an understanding of the benefits of a college education and the trade-offs involved, one might be tempted to postpone one’s studies to immediately address whatever issue confronts one. Yet, in the larger context, one usually winds up addressing an issue that is relatively minor from the lifetime perspective, but at a prohibitive cost.
Should you ever wind up in a situation where you are tempted to postpone or abandon your studies, do not make a rash decision to do so. There are a range of student support services—personal counseling, academic advisement, financial aid, to name a few—and extraordinarily dedicated people who can help you balance those issues with your studies to give you your best chance to attain your college degree.
Don’t ever hesitate to seek help if you need it. That’s the truly courageous course. And in the vast majority of circumstances, that’s the course that is in your best interests.