Student Debt

[Slimprofits]

Re: Student Debt

So the "Skills shortage" is simply a handy excuse for Fed researchers, FOMC members and other such bureaucrats.

[gwynedd1]

Re: Student Debt

Not surprised. My wife works in international development for a non-profit (as you might expect, doesn't exactly pay well). When we met she had 100K in outstanding loans and this was after paying them down for years. I looked at the loan terms and for some of them she would have paid them off when she was 60.

60!!!

But she didn't feel this was an issue -- she was paying the loans. She only thought about the monthly payments and not the overall amount. And my wife is a brilliant woman, just named one of the top non-profit CEOs in the Mid-Atlantic.

But this is the indoctrination that younger people are led into. It's not the amount, it's the payments.

[needless to say, we've paid off the loans in full and my wife has a new, eye-opening and very jaded view of education debt schemes having realized what was perpetuated on her and many others she knows]

Banks create as much government loaned guaranteed credit as students are willing to bid for a seat in the class room. The winner is the one who promises to hand over most of their earnings surplus over to the creditors who take no risk with no need to economize or plan. Imagine if it were legal to donate your organs. This might be hailed as a great way you to pay for an education. The problem is its not just you. Its an arms race and only the arm dealer wins.

I don't know what they are teaching the kids these days, but that isn't a proverb that seems to appear in the curriculum.

[don]

Re: Student Debt

Student debt is big business, Fan the flames, baby.

[wayiwalk]

Re: Keeping the E in FIRE

The idea that we need to allow in more workers with science, technology, engineering, and math (“STEM”) background is an article of faith among American business and political elite. (STEM: science, technology, engineering, math)......

Two comments - 1 - the numbers are probably skewed by the engineers/scientists who were smart enough (or not willing to suffer low-ish pay and no longer have the job security) to stay in engineering/science. Of the seven fraternity brothers who I graduated with that had engineering degress, only 2 of us are still working at engineering companies (me, a mid level project manager and the other, a production manager). I wouldn't be surprised if alot of the formerly educated as STEM workers went onto other pastures by choice, not by lack of opportunity to continue in the profession.

2 - Along those lines - there's nothing like the elite that expects those that can handle the more demanding coursework in the sciences to be expected to follow that career path, while they pursue power/money for its own sake. It's good to be the king!

[don]

Re: Keeping the E in FIRE

We're hearing today that over 80% of June's college graduating class has zero job offers. There's no breakdown by majors. Nevertheless, it doesn't sound good . . . .

[charliebrown]

Re: Keeping the E in FIRE

i have a long list of good IT engineers that I have worked with who are underemployed, or moved on to project management, or a completely different career.
The idea that there is a shortage of IT folks is hog wash. After the 90's IT boom and bust some of these people just had enough of long hours, out sourcing
job insecurity etc, and moved on. Wages have been fairly stagnant for over a decade.

I am one of the last real engineers still working as an engineer, and again, I have changed hats sort of. I used to be a prorgrammer analyst, but most of that work has been moved overseas. Now I am a problem solver, trying to get the feeble software shipped from offsite to behave properly. What would have taken me an hour to do, now takes a month, because of communication, legal, and loss of knowledge capital.

[Slimprofits]

Re: Keeping the E in FIRE

But charliebrown, STEM does not only include IT engineers. Perhaps there is a problem with grouping all of these things together into one neat package.

[suki]

Re: Keeping the E in FIRE

I believe that the numbers are correct, but what is missing is any notion of the quality of the STEM worker. An example from my own recent past: I was given a promotion several years back but as a condition of the offer I had to hire my replacement. I am a good, but not great EE, and my boss was expecting someone of the same quality. After a 4 month search and a review of nearly 120 resumes, and maybe 20 or so phone interviews we finally found one guy we were willing to make an offer to. He accepted. I gave him a big hug. He turned out to be a great engineer. But the rest I wouldn't trust to load batteries into a flashlight.

[Forrest]

Re: Student Debt

Is anyone out there actually analyzing what types of jobs there will be for all these bright young things in the decades to come?

Does anyone care about that sort of thing, considering that the students are in debt slavery from the moment they attend their first class, and their parents are equally caught in mortgages for property they shouldn't have bought?

[vt]

Re: Keeping the E in FIRE

http://www.washingtonpost.com/blogs/...ty-college-is/

The ’1 Percent’ isn’t America’s biggest source of inequality. College is.

• BY JIM TANKERSLEY
• May 22 at 4:50 pm

File: Protesters listen to speeches at the "Occupy Wall Street" protest in from of the Washington, D.C. on October 6, 2011. (Photo by Linda Davidson / The Washington Post)

One of the striking stories in the American economy over the last several decades is just how much the incomes of the super-rich have grown, compared to the incomes of everyone else.

But what if that the focus on those super-rich - the top 1 percent of all earners - has overshadowed a larger, more troubling gap: the widening one between college graduates and workers whose education stopped after high school?

That's the argument MIT economist David Autor makes in a brief research paper out Thursday - that "the growth of skill differentials among the 'other 99 percent' is arguably even more consequential than the rise of the 1% for the welfare of most citizens."

By Autor's calculations, if you'd taken all the income gains that flowed to the 1 percent over the last 35 years and redistributed them evenly to everyone else in the economy, that would have delivered an extra $7,100 a year to every household in the bottom 99 percent. That's a lot of money. But it's not as much as the growing pay differential between workers who went to college and those who didn't.

In the last 35 years, he calculates, the so-called college premium - the boost in your paycheck from earning a diploma - increased by $28,000, adjusted for inflation. So if you took that entire increase and redistributed it to non-college workers, you'd be giving them a raise four times the size of the 1 percent redistribution.

As he described it in an interview:

Imagine two people, average people, four people who go to the same high school, two men, two women. One of the men and one of the women decide to go to college, and one of the men and one of the women decide to call it off in high school. Let’s say that happens in 1979… at the time, they could have expected the college graduate family would earn about $30,000 more a year than the high school grad family...

Now, roll the tape forward 23, 24 years, and that annual gap has expanded from $30,000 to $58,000. So, almost doubled. So what might have looked reasonable in 1979 now looks like a bad bet.

Contrasting that increase with the growing income share of the 1 percent isn't exactly apples to apples. But Autor says it should be sufficient to challenge Americans' perceptions of inequality - and push policymakers toward more efforts to lift lower-skill workers up.

“I don’t mean to say the 1 percent thing is not a big deal. It is,” he said. But the "real reason to worry about inequality," he added, is "because of the falling bottom.”

Autor has spent much of his career tracking the forces that have hurt workers and incomes at the bottom, most notably outsourcing and automation trends that have reduced the value of physical labor and increased the value of brainpower. (In this paper, he notes that workers have also suffered because of steadily reduced power to bargain for better wages.) Workers have been relatively slow to catch on, he says - but there's hope.

"Prior cohorts of U.S. students, particularly males, were slow to react to the rising return to education during the 1980s and 1990s," he writes in the paper, "but the message appears to have finally gotten through. During the first decade of the 21st century, the U.S. high school graduation rate rose sharply after having been essentially stagnant since the late 1960s. This unanticipated rise was followed just a few years later by a surge in college completions."
Once that surge began, he notes, the college premium stopped going up.

[Forrest]

Re: Keeping the E in FIRE


One of the striking stories in the American economy over the last several decades is just how much the incomes of the super-rich have grown, compared to the incomes of everyone else.

But what if that the focus on those super-rich - the top 1 percent of all earners - has overshadowed a larger, more troubling gap: the widening one between college graduates and workers whose education stopped after high school?

Autor has spent much of his career tracking the forces that have hurt workers and incomes at the bottom, most notably outsourcing and automation trends that have reduced the value of physical labor and increased the value of brainpower. (In this paper, he notes that workers have also suffered because of steadily reduced power to bargain for better wages.) Workers have been relatively slow to catch on, he says - but there's hope.

"Prior cohorts of U.S. students, particularly males, were slow to react to the rising return to education during the 1980s and 1990s," he writes in the paper, "but the message appears to have finally gotten through. During the first decade of the 21st century, the U.S. high school graduation rate rose sharply after having been essentially stagnant since the late 1960s. This unanticipated rise was followed just a few years later by a surge in college completions."

Once that surge began, he notes, the college premium stopped going up.


It looks like the debt of 120K, plus interest might put the college educated on par with a well skilled High Schooler...an interesting way of leveling incomes across America...presuming there are jobs for either, of course.

[don]

Re: Keeping the E in FIRE



I See!

[Prazak]

Re: Keeping the E in FIRE

This was from yesterday, another one of those timely Non Sequitur comics that make you laugh and cry at the same time.

http://www.gocomics.com/nonsequitur/2014/05/22#.U3-MUl60_t4

[don]

Re: Keeping the E in FIRE

This was from yesterday, another one of those timely Non Sequitur comics that make you laugh and cry at the same time.

http://www.gocomics.com/nonsequitur/2014/05/22#.U3-MUl60_t4

Perfecto!

[charliebrown]

Re: Keeping the E in FIRE

You are correct slim, I can also add several very talented mathmaticians, double e's, and me's to the mix. Companies I am familiar with seem reluctant to hire raw talent, but expect someone with a narrow set of skills to be able to hit the ground running. The employer/employee relationship is broken.