But the earnings potential of a college degree is hampered by the weight of student loan debt. A recent study by PayScale on college ROI shows how much degrees from certain colleges are worth over a 20-year period. Brigham Young University and Georgia Tech are among the highest annual ROIs at 12.5%. The worst, with ROIs of -15% annually, include several branches of SUNY in New York and Savannah State University in Georgia. The research reveals that although, on average, a college degree can offer more earnings potential, the college you choose and how much you pay drastically impacts outcomes.
Perhaps an even more significant indicator than what school you choose is the degree major you pursue. Math and science, IT, human resources, engineering, and marketing majors offer the most bang for your buck. On the other end of the spectrum, Salary.com found that sociology, fine arts, religious studies, tourism, and psychology majors are among the worst majors for earnings potential. Last year, all hell broke loose when President Obama said, “Folks can make a lot more, potentially, with skilled manufacturing or the trades than they might with an art history degree.”
When art history professors and students railed, the President wrote an apology. Obama qualified that he was “trying to encourage young people who may not be predisposed to a four year college experience to be open to technical training that can lead them to an honorable career.” Political correctness aside, the President had a valid point that’s backed up by reams of credible research. Simply going to college will not guarantee you a financially viable path in life. And, in fact, pushing every student toward college is both impractical and unwise.
What’s disheartening is that just 6% of students consider pursuing a skilled trade yet there are blossoming opportunities in this sector. Thirty-six percent of employers report they’re struggling to fill positions in skilled trades. For every job that requires a Master’s degree, there are two jobs that require a Bachelor’s degree and seven that require a one-year certificate or two-year Associate’s degree. Clearly, there are more opportunities in skilled trades. These include HVAC and electrician jobs, plumbing, elevator maintenance, certified medical assistant jobs, and petroleum workers.
So while the President may have antagonized arts majors, the simple truth is that college shouldn’t be touted as the only route to success. While skipping out on education beyond high school altogether isn’t wise, there are far more options than simply getting on a debt treadmill and churning through college hoping for the best. Whether you agree with the President on other matters, on this one issue, he was speaking an inarguable truth: skilled trades are careers worth considering.[amazon template=iframe image&asin=B005639TF8][amazon template=iframe image&asin=B00U4GR1UW]