Economists offer stark advice for college grads

For inspiration, turn to Oprah Winfrey or Steven Colbert. For hard truth, check out these wonks' dry words of wisdom.

By Jason Notte May 14, 2013 8:36AM
College graduates © Ariel Skelley / Blend Images/Getty ImagesWith Harvard recruiting Oprah Winfrey as its commencement speaker, Tulane bringing in the Dalai Lama and Ohio State, Morehouse and the U.S. Naval Academy getting visits from President Barack Obama, graduation day can get lonely for economists.


This year's graduates don't really want yet another reminder about their punishing pile of loan debt, which the U.S. government turned into a $100 billion profit. They don't need more experts telling them that 284,000 of the grads who came before them are making minimum wage. They already know that The Center for College Affordability & Productivity reported nearly half of the class of 2010 hold jobs that don't require a bachelor's degree and that 38% have taken jobs that don't even require a high school education. You don't need an economist to explain why these trends have helped drop the median wage for college graduates significantly since 2000.


Still, today's grads are far better off than their less-educated peers and just want a day to celebrate that fact before life does everything it can to dampen their achievements. Stay away from the University of Virginia, Paul Krugman. The graduates coming to commencement are more than happy with Steven Colbert.


However, National Public Radio doesn't believe in coddling the nation's future workforce. The network -- whose idea of a good time is an old-timey quiz show featuring esoteric celebrities torn from the pages of the New York Review of Books -- decided it would force-feed this year's graduates their medicine and ask a bunch of economists to provide some unsolicited advice for them.


With lots of time on the economists' hands and no commencement invitations arriving in their mailboxes anytime soon, here's the wisdom NPR's good-time gang of econo-wonks had to impart to the Class of 2013.


Justin Wolfers of the University of Michigan's Gerald R. Ford School of Public Policy reaches out to the kids through the universal language of awkward metaphor:


Approach your career ambitions the same way you approached your romantic ambitions at college. Sure, you're looking for "The One," but the only way to find that is by going on a lot of dates. And you should think about your first job as a good first date. Try it out. If you like it, stick around for another year. But if not, ask another employer out. And keep playing the field until you've found the job you want to stay with.


Professor Emily Oster of Chicago's Booth School of Business gets a bit less chummy while espousing the virtues of soul-deadening compromise:


Economics works great for planning your life when you don't have a work passion, since we tend to assume that your job delivers only money and you trade off job hours with leisure hours. If you think your job will just be a job, pick one that pays well per hour and leaves you some time off, even if the activity of the job is boring. Since the world is full of people looking for a job that feeds their passion, if you are willing to do something which most people are not passionate about (accountant? Tax attorney?) there's an arbitrage.


Financial Times columnist Tim Harford, "The Undercover Economist," finishes up with some strong joy- and dream-killing:


Economists have found that if you graduate during a recession, your career prospects are stunted long after the recession itself is finished. The economy is recovering now, but slowly. A year's delay would do no harm – might I suggest signing up for a master's degree?


Happy graduation, folks! Now get to work. That latte isn't going to pour itself.


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129Comments
May 14, 2013 12:25PM
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Used to be that the college degree was a ticket to the middle class and beyond.  Now that dream has gone the way of "work hard and you will be rewarded."  The new motto should be "born in the right family and continue to live well."
May 14, 2013 11:30AM
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over sold over hyped. Joined Marines at 18 in 70's combat trained still in shape no medical or heath issues no prescriptions and worked government job  last 28 years aver 50K or more a year. This system is designed to milk the population and fill their heads w/lies and bury you in debt. It doesn't take an education to learn that.
May 14, 2013 12:39PM
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I think that a lot of these kids completely lack financial literacy.  It's as if they don't see these loans as REAL money that they are legally obligated to PAY BACK.  They act surprised that they are over their heads in debt on graduation day.  I think it's a genuine disservice to them that they aren't learning this stuff in high school, or better yet, from their parents.

May 14, 2013 12:29PM
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Harsh, but sadly, true.  But on commencement day, grads don't want to hear the truth.  They want to be flattered and patted on the back.  They'll find out the cold hard truth soon enough.
May 14, 2013 12:29PM
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"The economy is recovering now, but slowly. A year's delay would do no harm – might I suggest signing up for a master's degree?"

 

If you're already thousands of dollars in debt, why would you want to pile on more debt pursuing a master's degree?  Get a job, or better yet, two jobs, and start paying down your student loans.  Live frugally for as long as it takes to become debt free. Excessive debt, especially student loan debt, which won't go away even if you file for bankruptcy, is a form of slavery. 

 

After paying down your student loans, you can go back to school to acquire skills valued by the job market, if necessary.

 

 

May 14, 2013 1:29PM
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So accountants are not what people are passionate about ?!? After I graduated many years ago with a liberal arts degree and found I had NO job prospects, I went back to school and got my CPA.    It's very interesting and challenging work when you get above a bookkeeper level. Since every business has an accountant, the variety of industries in which you can work is unlimited.  Or you can go into public accounting and work on a variety of clients.  Dull it's not.  And 30+ years of steady employment is something I am passionate about.
May 14, 2013 2:43PM
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I admit, I was one of those 2011 graduates, walking out of school with a bachelors degree. Eyes in the sky, feeling proud and accomplished. In my head, I DESERVED a good job (having no real experience prior). Hell, I thought every company would be in competition for ME... until life donkey-punched me in the face.
May 14, 2013 1:16PM
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So if you can't find a job after you graduate, you should go back to school and rack up more debt? 

 

That sounds like an educator talking.  Teachers apparently don't live in the real world.  it used to be that you got paid for what you did.  Then it was you got paid for what you know.  Now it's you get paid for what you do for your company, and the more you know - the more you can do... for them.

 

WTF happened to America?

May 14, 2013 1:13PM
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this is the new form of indentured slavery. the difference is at the end of it there is nothing free coming your way from the government. 
May 14, 2013 2:16PM
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A College degree is not a ticket to wealth and happiness. It is an opportunity, nothing more. Those

who think otherwise will soon find that the road can be long and hard and that they are not as entitled as they think they are.A grad needs to work hard and  be lucky with no assurance that their dreams will be fulfilled.

May 14, 2013 2:50PM
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One piece of advice that applies universally: You will never become wealthy working for others. Work for yourself. Invest in yourself. Trust in yourself. 
May 14, 2013 2:55PM
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When I was a kid, we learned budgeting in high school.  I don't think that is taught anymore.  Also, in grade school PSFS Bank worked with our school in opening student passbook accounts so we would learn how money grows if you save it.  I never hear about this kind of thing anymore and I think it's a shame because every single student needs to learn how to handle money.  Of course, things are not the same now, but budgeting and saving are still good things to know.
May 14, 2013 2:42PM
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Stupid article and stupid advice.  One of the problems is that the educational system, from bottom to top, does an atrocious job of educating about basic finance, economics, etc., outside those majors.  We live in a society of rapacious capitalism, but we don't teach Elementary, Secondary and Higher education students any basic finance worth a damn, thus they become fodder for the car salesmen, loan officers and con artists of the world.  Makes a lot of sense, doesn't it. 
May 14, 2013 1:36PM
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My sister says "Today, you either own a Mc Donalds or you work in one".  She never went to college but she owns 3 McD's franchises.
May 14, 2013 1:00PM
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What is going to school worth today? Not much, I say.

I got off school after the 12th grade, had no debt, I got a job, learn to work hard, learn not to spend a dime I didn't have, start my own business, then start another one then another one and now just about to retire. I did very well and I thank my parents for a great education.

I can also say I wasn't brainwashed by the left in College.

Now, graduates only know how to text and drive while texting. Most of them have been spoiled, however there is a very small minority who gets it, having learned from real parents and a real family. I wish them good luck, I just don't want to wear their shoes though. Reality check is coming!

May 14, 2013 3:13PM
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They should tell these grads at the starting gate that most of them won't find decent jobs.
May 14, 2013 3:52PM
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I call it the "Friends Syndrome".  You know the sitcom from the 90s.  Six young people, most of them working odd jobs and living high on the hog with plenty of time and money to spend .

 

It doesn't have to be the show "Friends" to see this on TV.  Fabulous houses/apartments, nice cars, lots of free time, lots of money to spend, even though you are a waitress in a diner.  This is what young people think their life should be like.   As if if the TV character can have this wonderful life as a waitress, and since I have a college degree I should have an even better lifestyle.

 

May 14, 2013 3:41PM
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PrinceofDarkness!!!

Right on the money!   You will never become rich working for someone else.  The person that hires you will want to profit off your labor.  Why not start your own business and keep the profits?

I learned that 38 years ago.  When I didn't see eye to eye with an employer.   I became his competitor.  it was not all easy...  

But your advice is spot on!   Those with ambition, smarts, and a little luck will do fine.  Democrats will whine and depend on the nanny state.  They have the view like the imbecile '57 states', that business owners didn't build their business....  the government did...  America still is the land of opportunity, inspite of democrats....

May 14, 2013 4:17PM
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Bad advice from the economist that says delay entering the work force and work on a masters degree.  That should be a last resort option and only an option if it does not involve taking on more debt.  I was fortunate that when I finished college, I had no money, but I had no debt.  That gave me a huge advantage to start my professional career. I am now 48, I will have my house paid off this year and will have zero debt.  I can not tell you what a great feeling it will be to be debt free in 5 months.  I feel very fortunate and blessed, but I did live  a very frugal life and did not feel I had to buy everything I saw.  Keeping a low debt structure and living within your means is the best advice anyone can give.  
May 14, 2013 3:28PM
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The reason this explosion in student debt is happening is because the Gov. is in charge of 95% of student loans.  They want everyone to get an education, they claim!  REALLY?   If the Gov. wanted everybody to be successful they would teach in schools ( high school thru college how to play the game/stock market).  Instead they have built up these monuments/colleges to themselves as if they are going to churn out brilliance. Math class must now be an elective.  30-40 k per yr for school, 120-160 k for 4 yrs.  Tell a young person/grad. who desperately wants and thinks they deserve to buy a new car that it costs more than 1 yr or 1+1/2 yrs of their salary and you get a look of emptiness. This is a form of slavery like no other. They will get the car loan and be even deeper in debt. Who owns GM ? and makes it easy to buy a car.  Young people have to pay off these loans so they work in jobs that have absolutely nothing to do with there degree. After a certain length of time what they learned, can become outdated in today's technology driven economy.

Anyone ever ask why colleges teach dead end courses?  The politicians claim the country needs engineers  and scientists. Then only loan money for college to students who study in those fields. Guess that would stop the gears of the ever growing size of the college/monuments that politicians hold so dear.

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