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Education, the False God of Economic Recovery

No matter how much education your group has, or how little, your group's money income has been declining for 12 years, not just since the start of the Great Recession.

Yes, you need a good education to get a good job, but in the 21st Century you also need a good education to get a bad job. A recent study found that 46.3% of the projected beneficiaries of an increase in the Maryland minimum wage from $7.25 to $10.00 per hour have at least some college education. Yes, college educated people working for minimum wage, many of them full time. See the comments on Mark Thoma's post What's the Cost and Financial Value of College.

For plutocrats and employers, declining wages is a feature, not a bug. They want taxpayers to train their workers so they don't have to, and they want labor costs to keep going down. They are apparently not even embarrassed by this assault on American workers. Lumina Foundation and the Bill and Melinda Gates Foundation funded a study at Georgetown University's Center on Education and the Workforce to calculate how many more college graduates the US would need to turn out in order to drive down the college-versus-high-school wage premium from 74% to 46%! That's the goal—reduce the value of a college education by churning out an even bigger glut of degree holders. Even the study's authors question whether it will be feasible to get more Americans to complete college when they have to pay/borrow more as the incremental value of the degree is declining.

So here's my modest proposal: Declare a moratorium on hand-wringing about how to improve our educational system and instead focus serious national attention on creating tens of millions of jobs. Then we'll have the money to pay for more education for more people and a rising financial incentive for people to pursue higher education.

Why have we had for 12 years a chronic shortage of jobs up and down the education scale? Recently there has been a spate of punditry to the effect that American workers are being displaced by robots (shorthand for all sorts of automation). Well of course they are, and have been since the beginning of the industrial revolution, but I'm willing to bet that in the last 12 years many more American workers have been displaced by ill-treated Chinese teenagers than by robots.

Hat tip to Anne for the link to Census data. 

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Reader Comments (1)

Good post Roger. I can't believe there hasn't been more attention to that Georgetown study.

February 10, 2013 | Unregistered Commenterchristine

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