The UKs General Election was one off one of a handful of mantras banded about by the Labour Party
, headed by Tony Blair, the most prominent of which was his reply to a question about his top three priorities for his government, namely "Education, Education, Education!".
From that moment, the British education system set sail on a voyage of discovery and exploration, seeking vast fortunes in the future which was the promise of his mantra. Education was going to help our country become competitive and generate new incomes. Billions of pounds were sunk into the state education system (which a number of Labour Party MPs thought so good that they sent their children to private schools) to develop numeracy and literacy schemes, and to encourage more than half of school leavers to go to university. The incentive for graduates was that, over their working life, they earn £100,000 more than non-graduates because they would get the best jobs.
Here we are, over a decade later, with large numbers of graduates unemployed, with employers complaining that graduates are not equipped to deal with the world of work and under-graduates facing huge debts to get a degree which is unlikely to get them a job at the end of their time at university, let alone a good job.
In the US, one person, Peter Thiel (founder of PayPal), is encouraging school leavers to skip going to university and to go straight into business. He believes that higher is education is the next bubble which is about to burst. In the financial magazine Money Week last week, Thiel believes that the country is "saddling its brightest with ruinous debts for little discernible return".
So, what is a "bubble"? Thiel's definition is that it is something which is overvalued and highly believed. An example of how this belief that a higher education is a guarantee to earning more money, take the example of my local grammar school in Lincolnshire recently. A locally based international food company offered a position for a school leaver to join their company as a management trainee where, for two years, they would work in each part of the business to learn about it before being going on to a management position. The salary was £15,000 a year to begin with. How many applications did they receive? Zero. Nobody saw the opportunity to get into a good company , get experience and learn.
Now that graduates are likely to have to pay up to £27,000 in tuition fees for a three year degree plus interest , plus the cost of living (say, another £25,000), does that extra £100,000 over their working life look interesting? Let's say you work for 40 years. Take away the student loan and cost of living and you are better off by £1,230 a year. If one of the school leavers had taken that position at the food company, they would have been ahead not only in monetary terms than the graduate, but also in terms of experience. And, ultimately, what employers look for in a candidate for a role are experience, a good attitude and how they fit into the company.
So, unless a school leaver is going into a profession which requires them to have a degree, such as a doctor or a scientist, then the value of degrees is becoming questionable these days. And that's why it feels like the higher education system in this country feels like it's in a bubble. It's overvalued and highly believed that you will be better off with a degree, when you might be better off just going into business right from school and getting a three year head start, at least, in experience and earnings.
, headed by Tony Blair, the most prominent of which was his reply to a question about his top three priorities for his government, namely "Education, Education, Education!".From that moment, the British education system set sail on a voyage of discovery and exploration, seeking vast fortunes in the future which was the promise of his mantra. Education was going to help our country become competitive and generate new incomes. Billions of pounds were sunk into the state education system (which a number of Labour Party MPs thought so good that they sent their children to private schools) to develop numeracy and literacy schemes, and to encourage more than half of school leavers to go to university. The incentive for graduates was that, over their working life, they earn £100,000 more than non-graduates because they would get the best jobs.
Here we are, over a decade later, with large numbers of graduates unemployed, with employers complaining that graduates are not equipped to deal with the world of work and under-graduates facing huge debts to get a degree which is unlikely to get them a job at the end of their time at university, let alone a good job.
In the US, one person, Peter Thiel (founder of PayPal), is encouraging school leavers to skip going to university and to go straight into business. He believes that higher is education is the next bubble which is about to burst. In the financial magazine Money Week last week, Thiel believes that the country is "saddling its brightest with ruinous debts for little discernible return".
So, what is a "bubble"? Thiel's definition is that it is something which is overvalued and highly believed. An example of how this belief that a higher education is a guarantee to earning more money, take the example of my local grammar school in Lincolnshire recently. A locally based international food company offered a position for a school leaver to join their company as a management trainee where, for two years, they would work in each part of the business to learn about it before being going on to a management position. The salary was £15,000 a year to begin with. How many applications did they receive? Zero. Nobody saw the opportunity to get into a good company , get experience and learn.
Now that graduates are likely to have to pay up to £27,000 in tuition fees for a three year degree plus interest , plus the cost of living (say, another £25,000), does that extra £100,000 over their working life look interesting? Let's say you work for 40 years. Take away the student loan and cost of living and you are better off by £1,230 a year. If one of the school leavers had taken that position at the food company, they would have been ahead not only in monetary terms than the graduate, but also in terms of experience. And, ultimately, what employers look for in a candidate for a role are experience, a good attitude and how they fit into the company.
So, unless a school leaver is going into a profession which requires them to have a degree, such as a doctor or a scientist, then the value of degrees is becoming questionable these days. And that's why it feels like the higher education system in this country feels like it's in a bubble. It's overvalued and highly believed that you will be better off with a degree, when you might be better off just going into business right from school and getting a three year head start, at least, in experience and earnings.
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