Is it worth doing an undergraduate degree?

I've been thinking a lot lately about the value of university (see my previous post: Was my degree worth $40,705?). I've spent $48,495 on tertiary education so far: one honours degree (Environmental Science) and half a bachelors degree (Computing Science). That's a fair chunk of debt to be carrying around. Luckily I live in Australia not the US, so it's a secured debt dependent on my future income and not a night-time terror inducing unsecured debt. After a 2012 tax return of $7000 in income, it's safe to say I'm not going to start paying back my debt any time soon:P

The stories careers counsellors tell you
When I was in high school, there was only one option: university. I went to a selective entry school (Melbourne High) where the average IQ was high enough that they had to give us special hats to keep our brains from overheating;) And of course, the message was that being a MHS graduate, you would go to uni. Any other option was economic suicide. I remember having seminars from the careers counsellor showing tables like this one:

Average Rate of return for undergraduate degrees in Australia [1] 
(a 2012 study funded by DEEWR)

Discipline	Length of degree	Males	Females
Humanities	3	3.00%	9.00%
Science	3	10.00%	11.00%
Allied Health	3	13.00%	14.00%
Mathematics	4	13.00%	12.00%
IT	3	17.00%	15.00%
Engineering	3	15.00%	14.00%
Architecture	4	9.00%	6.00%
Medicine	5	16.00%	15.00%
Nursing	5	17.00%	14.00%
Dentistry	3	20.00%	17.00%
Education	5	11.00%	10.00%
Visual and performance	4	0.00%	0.00%
Commerce	3	17.00%	15.00%
Law	3	17.00%	15.00%
Economics	4	18.00%	15.00%
TOTAL	3	15.00%	12.00%

Looks pretty clear doesn't it? Go to uni (and choose the right degree - not Humanities or Performing/Visual Arts!) or you're going to end up driving a Toyota Corolla for the rest of your life.

The effect of ability bias
There's something Daly and co missed out: ability bias. Ability bias is the self-selection effect. The upper echelon of society go to university because they think it's what they need to be successful. But does university make them successful or would they have been successful anyway?


Mariotti and J. Meinecke [2] examined the effect of ability bias on rates of return from a university education. Rather than a 12-15% average return, they found that going to university only gave a 3.0-7.4% return on investment after factoring in ability bias. If we split it down the middle and call it 5%, you may as well just put your money in a high interest savings account.

Is a university degree worth it?
So for a 5% rate of return, you have to slog your guts out for three years, missing out on getting work experience and building networks with anyone who could actually give you a job. Of course, university is a pre-requisite for some jobs (e.g. medicine, law) but for the majority of careers, you don't need a degree to get started. The allure of a degree is that it will allow you to leap-frog the job-market competition and get into a higher status and higher paying role more quickly. The numbers don't seem to support this. Sure you get a little boost from university, but it's not going to give you that much of an advantage.

Career uncertainty
What's more both of the studies I mentioned looked at university graduates. What they're ignoring is the 17% of students who abandon an undergraduate degree before they're done [3]. This has got to shave off even more from the rate of return.

What's the bigger risk?
University was always couched to me as the 'safe option'. Having gone through the university system, I now see it as an enormous risk. You spend 3-5 years of your life on a course of study for a career that you may or may not follow.

My experience has been that my 6 years at uni (4.5 years in real terms, but in my insanity I tried to do a second full time degree at the same time), I have learnt very few skills that are valuable to me now. I've moved away from my Environmental Science degree and am now running my own IT consulting business. My consulting clients have not yet asked me to tell them about the universal theory of tectonics, demanded that I perform calculus, required me to write an environmental impact assessment or given me a test tube full of smelly E. coli and asked me to identify what strain they are. They haven't even asked me if I have a formal qualification in IT (I don't).
The alternative
If I could have my time again, instead of going to uni, I would have focused on three things:
1. Volunteering
2. Starting a business
3. Short courses

Volunteering
The advantage of volunteering is that it massively reduces the barrier of entry to the job market. As an 18 year old, I had no real expenses and had no real need for a high paying job. By volunteering at organisations that interested me, I would have (and have in real life) discovered if I really was passionate about that career, gained some practical skills and built up some networks with people who might give me a paying job.

Starting a business
Having spent the last two years starting five businesses, I've discovered that when I'm personally invested in a project, I put far more effort into learning than if I'm just writing an essay to try to get a good mark. Starting a business has helped me to develop the skills that matter: communication skills and organisational skills. School and university didn't teach me how to work well in teams or to deal with clients. Yet communication truly seems to be the distinguishing factor between people who succeed in the workplace and people who don't.  

Short courses
Maybe I have a sucky memory, but I find it difficult to remember what I learnt four years ago at university. Concepts seem to only stick in my head for a couple of months unless I use them. Rather than flagellate myself and eat 50 tablets a day of fish oil to try to improve my lackluster memory, my experience shows me that I'm better off doing a short course. I'm hopefully going to do a Certificate IV in Small Business Management this year. It should take about 9 weeks. My bet is it's going to be more valuable to me than my entire 4.5 years of study.

What do you think? Has uni been worth it for you?


References

[1]          A. Daly, P. Lewis, M. Corliss, and T. Heaslip, The private rate of return to a university degree in Australia. 2012.

 

[2]          M. Mariotti and J. Meinecke, ‘Bounds on the Return to Education in Australia using Ability Bias’, Australian National University, College of Business and Economics, School of Economics, ANU Working Papers in Economics and Econometrics 2011-551, 2011.

[3]          ‘High university drop-out rates cost $1.4bn’, TheAustralian. [Online]. Available: http://www.theaustralian.com.au/higher-education/high-university-drop-out-rates-cost-14bn/story-e6frgcjx-1225940860074. [Accessed: 24-Jan-2013].

Was my degree worth $40,705?

I have spent the last 4.5 years of my life at Monash University, studying Environmental Science. I now have a student loan debt of $40,705.

And you know what? I'm not going to be an Environmental Scientist. Like many uni graduates (stats anyone?), I don't intend on using my degree for my future career. Some people would look at my story and think "he just wasted 4.5 years of his life and cost the government $40,705 for nothing".



Let's look at the argument both ways. Topic for the debate "Was Jeremy's degree a waste of time and money?"

Negative: It was worthwhile
I certainly got something from my 4.5 years.

• Strong analytical skills. I can now read an academic paper, pick apart the evidence and decide whether its claims are accurate.
• Critical thinking. By the end of my degree, I was an autonomous researcher, choosing questions I was interested in exploring and designing experiments to answer those questions.
• Effective and succinct writing. I culled my honours thesis down from 20,000 words to 14,000 words.
• Teamwork. I did a number of group projects where I had to work with other people.
• Public speaking. I gave numerous talks throughout my studies, culminating in a 20 minute talk on my honours project.
• Subject matter expertise. I learnt all about geology, biology, ecology, biotechnology, environmental policy, physics and biochemistry.

Maybe those skills and attributes now make me worth $40,705 to Australia.

Affirmative: it was a waste of time and money
I did benefit from my degree. All of those skills are worthwhile. But I feel that getting a degree was a horrendously inefficient way to gain those skills. My degree focused on pumping me full of knowledge rather than turning me into someone who could meaningfully contribute to society. The skills I gained were mostly superficial and were largely a side effect of the learning process rather than the main objective of my degree.

I contend that I could have gained all of those skills in 1 year of focused attention. Instead of sitting in a lecture theatre with 100 people, getting talked at rather than learning, I could have learnt through experience and targeted feedback. I could have worked in a job that challenged me with real life, engaging scenarios instead of dull, worn examples from 20 years ago. I could have contributed meaningfully to society during my learning process instead of being a $40,705 drain on society.

What are the alternatives?
At my school (Melbourne High School), uni was the only acceptable pathway. There was enormous pressure to get a high year 12 mark so you could get into law or medicine or some such prestigious degree. I didn't see any other path.

Now, 4.5 years later, I see many paths I could have taken:
- straight into the workforce: After 4.5 years in a full time job, I am quite confident that I would have reached a management level position. I would have learnt a heap, applied it to real scenarios and earned quite a bit of money.
- apprenticeship: I could have done an apprenticeship in a trade. After 4.5 years, I could have become an accomplished bicycle mechanic. 
- volunteer: I could have spent my time volunteering. I would have gained all of the skills from university and made a positive societal impact.
- entrepreneur: I could have started my own business straight out of school. In 4.5 years, I would have gone through a lot of failure but am confident that I would have ended up with a thriving company.

What do these alternate paths require?
Courage and real time learning.

Courage
It would have taken a brave person to choose any of those alternate paths in my year at Melbourne High. A grand total of 2 people did an apprenticeship. 90% of the rest went straight into uni. I was not a brave person in year 12. My schooling taught me to be safe, not to take risks.

Real time learning
My university education was based on the idea that I had to spend 3-4 years learning something before I was capable of doing it in the workplace. The result of that education style is that I have forgotten everything I learnt at the start of the degree. Why? It's not useful to me anymore. That is a waste of time.

A far better model would be for me to learn something when I need it for a task. Modular skills workshops instead of protracted uni courses.

Apprenticeships for every profession
I believe academic education is wasted for the majority of people who don't want to become researchers. A better way would be to get people started in a job straight away. They would find out immediately whether they liked it and they'd learn skills they could use right away.

Why can't we have apprenticeships for every profession instead of just for tradespeople?

Just in time learning

At university much of what I was taught in my early subjects was the 'fundamentals'. Information and skills that might be of use to me one day. I would describe it as 'just in case' learning. I learnt about chemistry, physics, statistics and mathematics just in case I came across a situation, where I would need to use those skills and apply that knowledge.

I'm in my honours year now and I do need to use those skills and apply that knowledge. But you know what? I'd forgotten almost everything from those early years. Without a reason to hold onto those learnings, my brain sensibly threw them out the window to make room for things I did need to know.

Looking back on it, it was a real waste of time taking those subjects. A good 96 hours of my life went into every subject, into learning things that I didn't need. It wasn't an enjoyable learning process either. Without an interesting problem to solve, stats was a real drag.

A better way to teach
I reckon school and university would be a lot more valuable and a lot more fun if we ditched 'Just in case' learning and replaced it with 'Just in time' learning.

'Just in time' learning is all about learning things when and only when you need them. You learn to solve a specific problem or manage a project. Travelling to Mexico? Learn Spanish on the plane. Someone suing you for patent infringement? Learn patent law in the courtroom.

I find when I can use a skill or piece of information right away, it's a lot easier to learn and a lot more fun. I trust in my ability to learn things quickly.

A vision for a better school and university system
Imagine this: instead of doing projects that the teachers choose because they're tried and tested and easy to assess, students do projects that are actually meaningful. Chemistry students get challenged to synthesise a new molecule. Architecture students get given a real brief for a building for a real client. Economics students get tasked with finding a better way to do micro-loans.

These students struggle. Much of what they do in the project is outside what they've learnt in the classroom before. But they learn on the fly because they're interested in the project and they want to make it work.

The most important lesson:
The most important thing I learnt from university is not the content but the process of learning. I forget most of what I learn, but that's a good thing because it shows it's not useful.

If you trust in your ability to learn 'just in time', then you don't need classes. You need projects.