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so I'm finishing up a book project and the book is uh tentatively titled parents as Venture capitalists because
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uh the idea is to see if we can trick parents into reading this book and think about what's going on with uh education
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in particularly college and the context for this is that there's an enormous
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amount of complaining going on in the US now by the employer community about difficulty in hiring people
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finding people with the right skills and much of that complaining seems to be directed at
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education and uh one of the things we wanted to look at was to see whether this is actually true that is whether
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there's any Merit to these complaints and when you look carefully it appears
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that there really isn't any Merit to it that the big change seems to be that
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employers are not training people that uh entry-level jobs have largely gone away way and that what employers are
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really after is hiring people who can do the job as soon as they walk in the door
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and the proof for that has to be that you are currently doing the same job someplace else for a competitor that's
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what everybody wants to to hire nevertheless uh the pressure has come around to students and to colleges to
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try to get more vocational and so I'm trying to look at what that means and whether it's actually a good idea and
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the conclusion I think pretty clearly is no it's not a good idea and you can see
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obviously that it's taken to Extremes in some places there are courses at most
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every state university on turf management for example which is you know about golf courses and there are courses
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and majors in things like Adventure tourism and casino management and every little weird niche in the market and I
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think the uh ultimately I think the issue here is that higher education postsecondary education is just not well
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suited to deliver job training and getting your first job is probably not ultimately what your college education
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is supposed to be about uh but for parents of course it's a big issue of how much money you're spending for this
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and whether there will be a payoff at the at the end of it so I'd say at the
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moment there's an awful lot of concern parents are wearing my kid going to get
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a job the employers are complaining we want to hire people with a particular set of skills the colleges are kind of
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in the middle uh but it's a peculiar supply chain problem I think at the moment the the parents and the students
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potential students are so far removed from where the employers are in terms of information but also just in terms of
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timing the employers are saying here's what we want but it'll be five years
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we're not making any promises and the kids are trying to pick majors and colleges to go to based on the job
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market and it's it's really a mess right now I think is the punchline so I think the the takeaways
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at the moment maybe the first takeaway is that there's an incredible amount of
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variation in how well different colleges prepare you for all kinds of things uh when we hear policy makers talk about
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the need for more people go to college and um you know everybody President Obama says Needs at least a year of some
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sort of college the variation is so astonishing that talking about college in general
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doesn't really make very much sense you know there are maybe 10% of colleges in
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the US where going there actually hurts your rate of return if you look at what you have to pay to go there and what
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you're likely to learn from that afterwards in terms of your Market market value the best thing you could do
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is drop out that you're really not gaining anything at all from those schools uh and there are others that you
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know you have a terrific even immediate return um and still there are others where we think the long-term value of
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the education is way better than the first year job you're going to get out of this so I think the big return is
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that there's a huge variance the information is really poor about which schools are good ones or maybe even how
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to think about the problem and so it does suggest there's a real opportunity
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for information to make a difference and a little more careful thinking to make a
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difference as well I think the the thing that I found most surprising and disappointing I
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guess really is how messed up the system is I mean the extent to which uh kids are borrowing enormous amounts of money
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and going into debt um chasing what they think are job opportunities that may or
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may not be their years in the future I think the focus on very practical Majors um is I think ending up really turning
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around to bite people if you happen to graduate in a year when there's no Casino management jobs what do you do I
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think you're probably worse off uh than you would be with a Classics degree you
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know sort of equally unprepared for anything but at least um you know literate and understanding good
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arguments and critical thinking um but you know a lot of very vocational um experiences in College
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learning a lot of very practical things in the long run I think is very much a waste of time so I think the uh maybe
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the surprising conclusion first how messed up the system is and secondly the idea that being very
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vocational probably actually hurts you so I think a practical consideration here start starts with the maybe the
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first assertion and that is there's a heck of a lot of uncertainty and so planning today where you think the job
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market is going to be in five years is probably a Fool's errand it's just not
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going to work very well so uh one of the things we know in general from all aspects of business is shortening the
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forecasting time works a lot better so one of the obvious takeaways is delay your choice of major and delay your
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specification uh as long as possible and so in practice one of the things that also
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means is if you go to a college where it's going to be difficult to change Majors that's a real problem because
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it's quite likely that the student will end up being stuck there longer maybe
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having to do a fifth year as a way to try to get the courses that allow them to graduate with the new major they
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would like I have a son who did exactly that it ends up being a lot more expensive if it takes 5 years to get a
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degree as opposed to four well you know some obvious ones are if you can cut down the cost UPF front
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it's easier to get a better return on your investment and the information on
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what kind of school pays off is not um maybe not completely clear but uh it it's it may not be the case that it
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matters so much if you don't get into these super Elite schools so if you're
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level below there it might not matter very much uh there's a big area of maybe
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50% of the distribution of colleges based on quality that if you're in there
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anywhere in there it doesn't matter all that much I'd say the other maybe most
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interesting thing that I seem to be finding is that there's kind of an emerging model where um your
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employability after you graduate is driven by things that don't have to do with your college education per se they
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have to do certainly with the internships you've gotten and there are even a a network of vendors now that
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will give a recent college graduate work experience in some field where perhaps they never majored in college or know
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nothing about so there are places that will turn you into an IT person in six months for example uh and it's not
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classroom training so much it's real work experience you learn by doing as an
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appr model might might teach you and at the end of that experience what you get are uh references basically that say you
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know this person did the website for me this student solved this it problem for us they managed this project whatever it
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is so it might very well be that you're better off thinking about your employability being driven by
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experiences which are extracurricular as opposed to curricular things that go on
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in the classroom you know I think there are three sets of stakeholders in this discussion about
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colleges in the workplace there's obviously parents um and we've been talking a little bit about the parents
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uh concerns here about getting their kids jobs and the importance of thinking longer term there's also schools
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colleges in the middle which have been playing something of a brokerage role uh but may not have been doing a very good
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job of it to to be honest it's not clear that they are um you know really engaging the
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employers especially and that they're necessarily doing the best for the for
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the kids and then there's employers on the other end and I think the lessons
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for employers is that if you think about this as a supply chain you would never manage any other supply chain like this
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where you just complained loudly uh that you weren't finding what you wanted from
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your suppliers and you're just hoping they're going to produce it um at a
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price you want to pay they're just going to deliver it to your right but that is the way most employers
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seem to be thinking about the labor market that somehow the right people will just show up when they want them
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with the right skills I'd say the way to think about this as a supply chain problem is the employers who are the end
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users here really have to get closer to their suppliers which is the very least of the schools and maybe even before
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that uh the parents you know one of the interesting things we see um in other countries especially in India is the
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extent to which which employers are reaching out to parents uh even when they hire people you know they make the
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pitch to the parents not to the kids and try to make the pitch at the school level before kids pick their Majors
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maybe even at the high school level before they pick their colleges about what the opportunities are like with
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their company or maybe even in that field President Obama has had this effort for a little while a few months
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on about accountability and higher education and the scorecard they're trying to produce for higher education
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which is a good idea as a parent or any kind of student or anybody you could go on the website and try to see what does
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it cost to go to school here what are the job prospects like if you graduate with this degree or that degree and I
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think it's a it's a good start you know I think we've still got a problem that
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there's so much variation in the experience uh of individual students students depending on when they go and
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which major they choose at which school um that it's not a perfect solution but
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at least it's a start uh to get some sense about whether you're sending your
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kid to a an expensive college that's going to do them any good or not uh and
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I think it's really hard to know you know schools have gotten very good at marketing or at least better than the
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parents are at understanding the marketing and where do you go for objective information so you know it's
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not a bad start well one of the things we hear a lot is about the stem skill problem and stem
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stands for science technology engineering and math and the idea that we need lots more stem graduates well uh
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there's no real evidence for that and if you look at where they actually get jobs
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for example uh in the real Sciences like like biology about 20% maybe 25% of students who graduate with a degree in
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biology get a job that uses biology and even in fields which we think are hot like it
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only about 2third of people who graduate with an IT degree get a job in it and when they're asked why they don't the
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main explanation is they couldn't find one right so the idea that if you get a
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stem degree you're suddenly going to be fixed your problems are solved really is
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does not seem to be true you know there's a lot of reason research on labor markets and there's a
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huge industry in higher education but you know one of the issues in research is that research tends to fit within
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disciplines within paradigms where they don't talk to each other very much and
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so one of the things I'm trying to do here is to look across these different
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fields so you can see what the highered folks are saying about educational quality you can see what the labor
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market folks say about the wage outcomes from different jobs um you can can see what people in learning say about you
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know what sorts of contexts teach people the most and you know you can start to see maybe some patterns across these
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things you know I think this is a uh this is kind of a Capstone production right so I've done uh and doing some
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pretty focused studies and things like financial aid and student outcomes uh but you know a book like this which is
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pulling together a lot of things know is kind of it so my guess is I'm not following up this with anything um
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following this this is kind of it this is sort of what I know on this topic certainly the the current generation of
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kids in college have lived through a really difficult time worst labor market since the Great Depression and it's
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understandable that people would be anxious about this and especially parents of kids who are entering college
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now and those are about to leave I think the the good news is the economy is getting better and it's unlikely to look
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the way things look now in four or five years it's more likely to look like the
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way things did 10 years or so ago so I think the current circumstances are pretty unusual I think the other thing
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is it isn't clear that obsessing about jobs um now when you're in early in
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college or in high school for sure for sure it does you any good right uh it isn't clear that simply getting into the
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best college you can is going to make a defining difference in your life afterwards and particularly your
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economic prospects afterwards that there's plenty of time you got the rest of your life to worry about your uh
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about your career and your success is going to have more to do with how you manage those points than anything you
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can do about it in high school or or even in college for that matter so I I think the the advice for parents is
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things are going to get better they're already starting to get better and I'm
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worrying about it right now doesn't do very much good cuz there's not much
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that's going to [Music] matter