Today's Obsession: Is Education a Bubble?
Photo from Flickr member liako, who had the right teeth for the gig
Here’s a frightening opinion piece from The Atlantic, saying that American for-profit colleges are in a financial bubble.
This is a look at the financial basics of for-profit education. In a nutshell: educational costs have climbed even faster than healthcare costs. Included in this playing field of escalating cost based on speculative value of a degree is for-profit educators, who’ve been increasing output of bachelors’ degrees by around 400% since 2000.
For-profit educators get 80-90% of their income from government-approved educational loans and grants, just like non-profit educators. However, defaults from students of for-profit schools is over 40% of the national total. Considering the number of degrees combined with the amount of default, that looks like a speculative bubble. And this means the government’s investment in the future potential of students from these schools is being defaulted upon. That, right there, is some scary scary stuff.
Why am I including this in a publication on design? Easy: a lot of these schools teach graphic design programs. If this continues, our field is going to fall even further in value than it did during the dot-com bubble, when designers were popping out of undergrad programs faster than jobs were appearing.