Will a higher education degree prepare you for the future?

3D Employment Graph. Image Credit: Chris Potter, via Flickr/CC.

3D Employment Graph. Image Credit: Chris Potter, via Flickr/CC.

Factoid: 5,000 = The number of PhDs in the U.S. who are working as janitors.

This factoid from a 2010 National Bureau of Economic Research working paper has been making the rounds this week — inspiring renewed discussion regarding the value of a higher education degree. On reddit.com, the thread [Today I learned] there are over 5,000 janitors in the U.S. with PhDs. attracted 823 comments. The Daily cited the original NBER working paper in their Boxes and Briefs section for their January 9, 2012 edition; adding that “17 million Americans with college degrees hold jobs below their eduction level.”

If time permits, I want to take a closer look at the original research — to learn more about the data, model, and findings. Until then, this post will continue to be tagged as a ‘fragment’.

Notes for learning more

Original publication that inspired the ongoing discussion

Read Estimating Marginal Returns to Education, the National Bureau of Economic Research working paper No. 16474 drafted by Pedreo Carneiro, James J. Heckman, and Edward J. Vytlacil (October, 2010). The full text is also available as a PDF. The abstract for the working paper provides some context of the author’s intent:

This paper estimates the marginal returns to college for individuals induced to enroll in college by different marginal policy changes. The recent instrumental variables literature seeks to estimate this parameter, but in general it does so only under strong assumptions that are tested and found wanting. We show how to utilize economic theory and local instrumental variables estimators to estimate the effect of marginal policy changes. Our empirical analysis shows that returns are higher for individuals with values of unobservables that make them more likely to attend college. We contrast the returns to well-defined marginal policy changes with IV estimates of the return to schooling. Some marginal policy changes inducing students into college produce very low returns.

Opinions published regarding the research

Read Why Did 17 Million Students Go to College, written by Richard Vedder for The Chronicle of Higher Education (October 20, 2010). Veder concludes that “higher education is on the brink of big change” and that “state governments are cutting back  higher-education funding, thinking it is an activity that largely confers private benefits.”

Read There are 5,000 Janitors in the U.S. with PhDs, written by Kyle Vanherert for Gizmodo (October 22, 2010). Vanherert ends with a collective shrug writing “whatever some eggheads work out ‘college’ to mean for people on paper can’t really take into account the experience of going to college, but the numbers are pretty surprising nonetheless.”

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