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By Jared Bernstein
Senior Fellow, Center on Budget and Policy Priorities

You want my advice, you should pour a tall cup-a-Joe and settle in to read this essay by Sean Reardon in Sunday’s New York Times on education and wealth. He covers a lot of ground, but the theme that resonated most with me is one I’ve stressed often in these parts regarding the growing evidence of linkages between increased income inequality and diminished opportunities. A prominent channel through which this occurs is, of course, education.

It’s not just that rich kids do better in school than poor kids. That’s an old problem.

What is news is that in the United States over the last few decades these differences in educational success between high- and lower-income students have grown substantially.

Moreover, these growing differences show up in college access and completion.

…the proportion of students from upper-income families who earn a bachelor’s degree has increased by 18 percentage points over a 20-year period, while the completion rate of poor students has grown by only 4 points.
…15 percent of high-income students from the high school class of 2004 enrolled in a highly selective college or university, while fewer than 5 percent of middle-income and 2 percent of low-income students did.

How, though, do these developments link up with inequality? As Reardon sees it “the academic gap is widening because rich students are increasingly entering kindergarten much better prepared to succeed in school than middle-class students. This difference in preparation persists through elementary and high school.” (more…)

Four years ago, the average cost of tuition at a four-year, in-state public university rose 6.4 percent. At the same time, many colleges were forced to freeze spending, and in the case of private schools, circumvent what was supposed to be needs-blind admission standards.

Despite the tuition hikes, colleges were cash strapped because states, which also faced budget problems during the Great Recession, cut allocations to higher education. In addition, college endowments shrank as the stock market spiraled down after the Wall Street crash.

Paying steadily-rising college tuition remains a burden on many families. Now, however, the federal government is providing more information to help students make decisions and more federal Pell Grant money is available to help pay tuition.

The U.S. Department of Education’s College Affordability and Transparency Center has established centralized, easily accessible tools to aid students and their families in applying for financial aid, comparing colleges and understanding costs.

These tools, like the College Affordability and Transparency Lists released in 2011, assist students in determining the real price of college and understanding the entire financial obligations students would incur. (more…)

By Jane Van Galen
Professor of Education, University of Washington Bothell

I was half-listening to the radio last week when I heard an interviewer ask a question that made me pause in my work to listen. “So”, the interviewer warmly asked, “You knew even as a small child that you wanted to be a concert cellist?” “Oh yes”, the woman answered. “Since I was eight.”

I’ve been thinking about that brief exchange ever since because I sometimes tell stories of cellos when I teach about the dreams of poor and working-class children. I tell my students that for all I know, I might have become this generation’s best concert cellist and the world would have been richer for it. The problem, I explain, is that there were no concert cellists within miles of my small Wisconsin town. There was very limited access to classical recordings, and almost no live music beyond church choirs and school bands. There were no cellos in my working class community.

At eight, I could never have imagined becoming a concert cellist (or any of hundreds of other things) because I had so little access to information about how such things came to be. I knew that people in other places played in orchestras because I’d heard them on TV and had seen some records at the public library. But the path from my world to the distant places where such things happened was invisible to me.

My parents and teachers supported my dreams as best as they could. But I could never have dreamed of cellos. (more…)

By Robert Reich
Former U.S. Secretary of Labor, Professor at Berkeley

As a former secretary of labor and current professor, I feel I owe it to you to tell you the truth about the pieces of parchment you’re picking up today.

You’re f*cked.

Well, not exactly. But you won’t have it easy.

First, you’re going to have a hell of a hard time finding a job. The job market you’re heading into is still bad. Fewer than half of the graduates from last year’s class have as yet found full-time jobs. Most are still looking.

That’s been the pattern over the last three graduating classes: It’s been taking them more than a year to land the first job. And those who still haven’t found a job will be competing with you, making your job search even harder.

Contrast this with the class of 2008, whose members were lucky enough to get out of here and into the job market before the Great Recession really hit. Almost three-quarters of them found jobs within the year.

You’re still better off than your friends who didn’t graduate. Overall, the unemployment rate among young people (21 to 24 years old) with four-year college degrees is now 6.4 percent. With just a high school degree, the rate is double that.

But even when you get a job, it’s likely to pay peanuts.

Last year’s young college graduates lucky enough to land jobs had an average hourly wage of only $16.81, according to a new study by the Economic Policy Institute. That’s about $35,000 a year – lower than the yearly earnings of young college graduates in 2007, before the Great Recession. The typical wage of young college graduates dropped 4.6 percent between 2007 and 2011, adjusted for inflation.

Presumably this means that when we come out of the gravitational pull of the recession your wages will improve. But there’s a longer-term trend that should concern you. (more…)

By Dean Baker
Co-Director, Center for Economic and Policy Research, Author

Jason Richwine and Andrew Biggs have a piece saying that many public sector workers are overpaid in which they also say that I agree with them in much of their analysis. This is true.

Let me outline what I think are areas of agreement. First, we seem to agree that if we just compare the straight wages paid to public sector and private sector workers, the latter do better. When we adjust for education and experience, private sector workers tend to get higher pay than their counterparts in the public sector.

This is not true across the board. My colleague John Schmitt has found that while workers with college and advanced degrees (e.g. doctors and lawyers) get less in the public sector, less educated workers get paid the same or slightly more than their counterparts in the private sector. In other words, there is less inequality in public sector wages than we see in the private sector, with the average being somewhat lower.

We also agree that the lower wages for public sector workers are largely or completely offset by higher benefits. The key difference here is that public sector workers are far more likely to have a traditional defined benefit pension plan. Most workers in the public sector still have defined benefit pensions, while less than 20 percent of workers in the private sector do. (The difference is considerably less stark if we restrict the comparison to large private firms, where defined benefit plans are still common.)

Richwine and Biggs conclude that public sector workers are overpaid because the two assign a high value to the nature of the guaranteed benefit in traditional pension plans. Their point is that a guaranteed benefit of $1,500 a month in post-retirement is worth much more than a contribution to a 401(k) type plan that would on average provide the same benefit.

Richwine and Biggs are absolutely correct on this point. This guarantee does have considerable value for workers. The point here is straightforward. We may expect the stock market to provide returns that average 10 percent before adjusting for inflation, but if the market happens to be down in the year I retire, then I am out of luck. If the government has assumed this market risk for me, and will simply give me the average return, then it has made me considerably better off. (more…)

By Jennifer Dorr
Editor, National Labor College Community Blog

For the last 16 years, Rodney has been fortunate to work at a work site that has provided good union jobs for more than a century.

But a two-week layoff was the reality check he needed to confirm his decision to finish his college degree online with National Labor College. It was a tough move for the 40-year-old father of two, who often works 60-hour work weeks, including weekends.

“It’s not easy, but I’m glad I made the decision to complete my degree in construction management at the NLC. It doesn’t feel like an ‘online college’ because the students are so connected to the faculty and to each other.”

It helps that the College is geared towards working adults: “As a union member, I can relate to the classes offered at the NLC.”

He credits his wife, Tina, for his being able to continue to be involved in his kids’ activities as well as his union’s political activities: “You have to carve out time to study which isn’t always easy; I couldn’t do this without my wife’s help.”

Rodney, whose father worked at his plant for 30 years, is proud of his roots, but wants his sons to know that finishing college is important, especially in this economy.

“I’ve always felt that political action was important because our leaders make so many decisions that affect working people’s lives. I still feel that way but I also think education is a powerful tool for making your life better.”

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This has been reposted from the National Labor College blog.

I contacted the White House to give them my ideas regarding higher education. I believe states’ public colleges should pool their resources concerning online courses and offer two levels of degrees statewide. For example, in engineering something geared to Penn State might be level  one and to MIT level two.

This should greatly reduce the cost which could be passed on to the consumer/student. Eventually it could be done nationally, and the private schools could be brought into the mix as well.

If done properly, even minimum wage earners could afford to burn the midnight oil without huge debt at graduation. And as a country, we would be far more competitive which should increase jobs. That way everyone could get a college education, not just the rich and handful of lucky that get scholarships, which are hard to come by.

Bruce Sunderland
Conshohocken, Pa.

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