Periodically, we learn that employers need a particular set of skills and universities should re-tool accordingly. These in-demand fields command higher wages, and so students are encouraged to flock to them. Indeed, politicians often claim that producing more graduates with said skills will help with unemployment and increase wages overall.
Let’s look at the economics underlying these claims. Under what circumstances does more widespread availability of a product lead to higher prices for that product? I’m pretty sure that the laws of supply and demand would indicate just the opposite result — significantly increasing the supply of a product leads to commodification, creating a buyer’s market where sellers have to compete on price.
Furthermore, since when have employers clamored to pay more people higher wages? If there’s a single characteristic trait of contemporary capitalism, surely it is the constant demand for ever-cheaper labor.
Hence, I conclude that when a particular field or skillset is trumpeted as the Next Big Thing demanded by employers, the goal is to get students to flood that field or skillset in order to commodify it. And this isn’t just a hypothetical — isn’t it exactly what has happened with computer science majors within the last ten years or so?
For that reason, I would advise students to actually avoid such “hot” majors, unless they have a good reason to believe that they will be significantly ahead of the curve. By the time the in-demand field is being propagandized in the mainstream media, it’s almost certainly too late for that.
Given the pressures leading inevitably to the commodification of particular job skills, I believe that a liberal arts-style education that increases students’ adaptability and ability to pick up new skills is a much better — indeed, safer — investment than any directly job-oriented program of study. But what do I know? I’m just an idiot who cares about my students’ actual well-being, not a job creator who wants to exploit them on as cheap and flexible terms as possible.
An und für sich 
Even better: under the student loan regime, students are actually paying huge sums of money for the privilege of degrading the value of what they’re learning!
I always joke those articles detailing the hot and cold careers are written by somebody with kids majoring in one of the “cold” careers.
Furthermore, even if you *are* ahead of the curve, you’re likely to only have a few years before the field fills up with younger, brighter, more desperate people, who will gladly take your job for a fraction of what you’re being paid.
Hence… :)
Also, note the fact that even though everyone knows that bankers and financial executives rake in cash, there isn’t similar rhetoric surrounding the courses of study that would put one on that path. In, fact, that path itself tends to be simply mystified in media narratives, treated as this weird savant thing with no concrete professional path in terms of education, entry level jobs, etc, but instead exceptional individuals in the right place/time.
Anecdotally I’ve seen this to be the case with my cousins. One has a music education degree (with geography) as well as the required education degree to be a teacher, and is working at a tech company that sells data, gets companies to license their software needs appropriately. He has to make presentations and such, where his teaching background comes in handy.
A couple of my other cousins have college (where in Canada that means a two year diploma/certificate thing) computer/design) things and have both struggled for 1-2 years to find jobs even while they seem to be ahead of much of the “competition”.
There’s also the maximizing profit issue, where once they had jobs there was no security. One of them lost his job at the end of the fiscal year, the other lives in constant worry that he will lose his, as the company continually reworks the machine to use as little labour as possible. After the company has continually done more business and made greater profits. We’ve had a few “You know what would solve this problem? Full communism,” conversations and they actually seem to consider it being at least a half way good idea. And they’re both conservatives!
Full communism is the wave of the future.
Just don’t major in full communism.
I worked in the investment industry (doing a variety of stuff, but mostly marketing hedge funds) for most of my life – there’s no particularly massive mystery as to how to enter the industry. (Well, most of the people who want to enter the industry will never be able to do so – but it’s not a huge mystery as to how to go about doing so, it’s just a matter of making the cut or not.)
Rather amusingly, the best ways to enter the industry are more or less the exact opposite of what is retailed as “colleges don’t provide the skill-sets we need” propaganda.
Well, what are they?
Probably the best way (or, at least, one of the better ways) to get an Ivy League undergraduate degree (only two of which even offer undergraduate business degrees at all). I have a BA in philosophy from a SLAC and an MBA (note: I had been in the industry already for over 5 years before I went to graduate school). The actual major is far less relevant than other factors (primarily work experience and certain extra curricular activities).
The fact that only two Ivy League schools offer undergrad business degrees is one of those “big reveals” — kind of like the question, “Where do education reformers send their kids to school?”
Precisely. And the only two Ivy League schools that do offer undergrad business degrees are the two “least prestigious” (whatever that means) of the group – Cornell and UPenn.
And this isn’t just a hypothetical — isn’t it exactly what has happened with computer science majors within the last ten years or so?
I don’t disagree with your general view, but this isn’t a great example, since CS salaries have gone up in the past 10 years, to a somewhat surprising extent. Things are so ridiculous that starting salaries for fresh-out-of-college CS majors at places like Google are pushing $100k.
The people getting the Google jobs are not your run of the mill CS majors. They are Ivy Leaguers and other people for whom the investment of going to college was more than ingesting the appropriate content. You wouldn’t believe the number of people that go in to management consulting (quickly making mid six-figures) with PhDs in the hard sciences, i.e. with no formal training in management consulting. What they do have, however, is a PhD from a top 5 program (i.e. Harvard, MIT, etc.). This isn’t a career path open to science PhDs, generally.
Seconding what Mark said. And while it’s true that the big jobs at Google &c. aren’t open to everyone, even less prestigious jobs in the field still pay pretty well. Avg fresh-out-of-university salaries for CS degrees are comparable to engineering degrees, and CS is *much* easier than your typical engineering program.
This is probably more a sign that the field hasn’t been as flooded with graduates as corporations have hoped, though. We’ll see how long it lasts.
I agree well-paying tech jobs certainly aren’t going to everyone with a tech degree. But they are going to a ridiculously large number of people. Google alone added 10,000 new full-time employees in 2012. That’s more than all American universities combined added in 2012.
British economist Alison Wolf has done some brilliant studies debunking this whole push towards higher ed as a means of increasing economic growth and individual incomes. The points are pretty simple though: degrees are positional goods, and economic growth generates graduates (not vice versa)
“Periodically, we learn that employers need a particular set of skills and universities should re-tool accordingly. These in-demand fields command higher wages, and so students are encouraged to flock to them. Indeed, politicians often claim that producing more graduates with said skills will help with unemployment and increase wages overall.
Let’s look at the economics underlying these claims. Under what circumstances does more widespread availability of a product lead to higher prices for that product?”
You’ve distorted the argument slightly. Nobody is arguing that one should go into a particular field, and then the salary in that field will go up (as you argue, above). Instead, they are arguing that one should go into a particular field, and then YOUR salary will go up. To simplify it: your version of the argument: “If everyone becomes mechanical engineers, mechanical engineering salaries will increase.” The real argument: “If you become a mechanical engineer (instead of an English major), your salary will increase.”
Note that both you and your critics could be correct: english majors becoming mechanical engineers may increase their salaries, and flooding the market with mechanical engineers may reduce the average salary of mechanical engineers (which would nevertheless remain higher than english major salaries). I’m not saying you and your critics ARE correct: but you both could be. You are arguing different things.
I don’t think you fully grasp the stupidity of the arguments I’m critiquing.