The current model of higher education is collapsing on today’s young Americans.
Last week, talk show host Silvio Canto Jr. focused on issues related to college students and their relative preparedness to handle today’s economic climate. He was joined in this discussion by Kevin Kellert, who currently attends the Kellogg School of Management at Northwestern University. (Click HERE for a link to the podcast).
Before pursuing an MBA, Kellert attended Williams College and worked in investment banking for five years. He is also runs the website: KRK Reflections – Economics and Personal Finance Guidelines for Young People.
The discussion also included Aaron Clarey, author of “Worthless – A Young Person’s Indispensable Guide to Choosing the Right Major“. Clarey also penned a book on the “Housing Bubble”, “Behind the Housing Crash”, and he applies a lot of the same observations about today’s system of higher education.
The main program begins by noting that recent studies indicate that most college graduates are not prepared with the skills necessary to successfully and productively enter the workforce, despite colleges marketing their programs as being necessary for a good-paying career. Kellert notes that one of the problems is that higher education programs are not focused on the realities of the current marketplace.
“There is segmentation of the US economy, which places a high premium on a highly skilled labor force”, notes Kellert. “Employers need employees versed in math, science, creative thinking, and excellent writing. Hiring managers don’t believe schools are adequately training these kids.”
Clarey is concerned that college has become “a racket akin to the housing market.” The author says that counselors and administrators tell students to follow their hearts, convincing them to spend thousands of dollars on fun and easy degrees. This, in turn, makes them unemployable or under-employed while they carry a high debt burden.
In fact, Canto and his two guests report that many of the recently employed graduates they know are complaining about the fact they are under-employed. Kellert states that a contributing factor to the student debt burden crisis is that high schools and colleges fail to teach basic money management skills.
“Personal finance concepts are not taught,” says Kellert. “Students don’t fully understand where the money for their education comes from. This is especially problematic in an information economy. They need to be able to make informed decisions about financial matters.”