Sending your child to college has long been an important milestone for parents as well as for their children. But is getting a degree the way of bell bottoms, cable TV, and calling someone on the phone?
With a strong economy and an overabundance of jobs with few workers, big companies like Google, IBM and Delta Air Lines have relaxed education requirements in an effort to find new hires. employees based on skills and experience.
With a four-year degree perhaps not as important for Americans climbing the career ladder as it once was – young people may also be rethinking the need for college.
“A little [like] Alicia Modestino, associate professor and labor economist at Northeastern University. “We are seeing a lot of people changing jobs, advancing in the labor market. So great.”
However, she warned that with the Fed interest rate increase In an effort to quell inflation, Americans need to prepare for a job market that will slow in the coming months.
“Soon, the music will stop — so you want somewhere to land that will be good for the long haul.”
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The tech industry in particular has struggled with a talent shortage since the pre-pandemic era.
Google and 150 other companies use the tech giant’s online college replacement program to train and hire new hires, The Wall Street Journal reports. And according to CNBC, IBM doesn’t require a bachelor’s degree for half of the roles in the US.
Bank of America also doesn’t require a college degree for most beginner jobs, while Delta says degrees for pilot candidates are “preferred” but not required.
And applicants for thousands of government jobs in the state of Maryland no longer need a bachelor’s degree — instead, they can submit any relevant work experience, military training or educational credentials. other sex.
This change came in a developed labor market with low unemployment and high employment opportunities. And although it’s said that’s coming to an end, the Labor Department’s latest jobs report shows hiring slowed only slightly in November, with 263,000 jobs added last month, compared with 284,000 jobs in October.
Modestino adds that there is precedent for this approach. During the Great Recession, employers responded by focusing on skills requirements in addition to education requirements because more workers with college degrees were available to them.
It may not be a real ‘culture change’
So parents should stop save money for their children’s college tuition? Modestino is “pessimistic” about whether major employers loosening their educational credential requirements is actually part of a “cultural shift”.
And with the recent changes in the economy, she worries about the future of work.
“Looking at where we are in the business cycle and what the Fed is doing with interest rates, [there’s] Modestino warns that we are likely to go too far and fall into a recession.
Federal Reserve increase its federal funds rate for the seventh time this year and more hikes are expected in 2023. Experts like Modestino fear this could trigger an economic downturn, which means hiring slows and could potentially lead to a recession. the possibility of wage and employment cuts.
Modestino advised her stepson – who already has a bachelor’s degree in criminal justice – that he needed to take advantage of the hot job market and start a career.
“We don’t know if the labor market will land slightly in the next six months,” she said. “So I would certainly urge any young person… that now is the time to make those decisions. Because I worry that that opportunity is closing.”
She predicts that as the workforce becomes abundant again and employers have more applications to sift through, many companies will “fall back to the lowest common denominator” as they hire – a four-year college degree. five.
So is getting a bachelor’s degree really worth it?
Parents may have long encouraged their children to pursue higher education, but Modestino points out that there are many jobs that don’t require a four-year college degree. And so making the important decision about whether to go to college or not should depend more on young people’s career goals.
For example, you don’t need a bachelor’s degree to become a venipuncturer, but will likely require a certificate in blood draw surgery. On the other hand, a PhD is required to become a hired university professor.
That said, having more credentials can look good on a resume and open up opportunities for inexperienced workers—especially when job opportunities are few and employers Workers can be picky.
During a recession or weaker labor market, having an academic degree can often cause a “sheepskin effect,” says Modestino — an economic phenomenon in which employers pay higher wages for workers with degrees.
A study from Georgetown University found that people with a bachelor’s degree earn 31% more than those with an associate’s degree and 84% more than those with a high school diploma. But higher education does not always mean higher income.
“When you’re in a labor market like this, we’ve seen wages actually go up faster at the bottom because they’re so hungry for talent. And so [employers are] Modestino explains: really try to recruit talent and reward talent, rather than just based on qualifications.
But keep in mind that students pay a price for that extra earning potential. With about 43 million borrowers in the US with more than $1.6 trillion in student debt, getting a degree isn’t always easy. worthy of the financial burden. Parents who push their children to further their education just for that purpose may want to have a larger conversation about whose interests they are prioritizing.
“There has been this message for at least two decades that college is the only way,” says Modestino.
“I think it is at a disadvantage for some young people who should have attended a vocational technical school or chose a different path through training and workforce development.”
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