Higher Education: Are Graduate Programs Scams?
Many graduate programs are “scams,” according to the higher education policy analyst James Murphy. He is a senior analyst at the Education Reform Now (ERN) group and strongly believes in graduate degrees being scams in disguise.
Murphy states that the reason why millions of Americans enroll in graduate programs each year is justified, that is gaining new skills to make them stronger candidates for corporate jobs. Students may apply to graduate school after their bachelor’s; however, this degree comes at a cost.
An economic term called ‘opportunity cost’ refers to the value of your next best option. In this case, the opportunity cost of getting a master’s degree would be the time and money you could have spent and earned from working, respectively. James Murphy agrees that people apply to master’s programs to get better-paying jobs; however, they are giving up money they could have earned to earn more money in the future.
Why Might Master’s Degrees Have A Negative Return?
A study conducted by The Foundation for Research on Equal Opportunity (FREOPP) showed that master’s programs related to “engineering, computer science, and nursing virtually guarantee their graduates a financial return. But programs in the arts and humanities rarely pay off at all.”
Arts and Humanities master’s degrees make up 40% of all master’s degrees and fail to give a positive return. Instead, they might provide a negative return on your investment in your higher education. But what is the reason for this? According to CBS News, James Murphy claimed that the end result of your master’s degree or your future income does not equate to the time and cost you spend completing the degree and not working. You might spend money on a degree that is more than you could earn in the future; hence, “you end up making less money by getting this degree.”
1. High Enrolment Rate
Despite the figures provided by surveys, more people are enrolling in master’s programs. Since the pandemic’s beginning, the number of master’s students has only continued to rise due to the shift from in-person classes to online classes.
Thus, students can now pursue master’s degrees while being geographically far. However, the real problem begins when students enroll in master’s programs with limited employment opportunities. Their expectation would be to find a high-paying job in the future, but jobs will be scarce, and competition will be extremely high.
2. Student Loan Debts
There is another factor to consider on why there may not be a positive return on your investment. Student Loans. Approximately 60% of people pursuing a master’s degree take out a student loan to pay for their expenses. However, these people mostly end up with student loan debts. Murphy states that the government is responsible for carelessly giving out big loans to people, often more than they can pay off.
Unlike undergraduate students, graduate students can take out unlimited loans to meet their expenses, while the former has a limit on loans to prevent overborrowing. Thus, graduate students continue to be burdened by student debt they have to pay for perhaps the rest of their lives. Meanwhile, universities continue to get richer. According to NerdWallet, the average student loan debt is $71,000 for graduate students. Similarly, another study found that graduate students only make up 25% of student loan borrowers, but they also make up half of all student loan debts in the US.
3. Low Job Growth Rate
More than 9,000 new master’s degree programs have been created in the past ten years, but new career paths have not. Hence, there is an imbalance between job creation and graduates who qualify for the job.
Subsequently, unemployment exists as people might become overqualified for the job. Universities and similar institutions benefit the most while students may be unemployed and under great debt. Murphy further adds, “it’s the universities who are seeing giant piles of money out there and grabbing it.”
The Solution According To Experts
The education policy program’s director at New America, Kevin Carey, said, “We need a stronger regulatory hand in the master’s degree market… need more transparency around how selective are graduate programs, how effective they are in helping people get jobs in their field and pay their loans back.”
He also added that the government should stop lending money if students consistently borrow money for their master’s degree, more than they can pay off. Even after getting a master’s degree, if students cannot secure jobs and pay off their debts, it can become a very concerning matter.
Is A Master’s Degree Really Worth It?
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James Murphy has given useful advice for people wanting to pursue a master’s degree. He has encouraged those people to first ask themselves why they want to get a master’s degree before enrolling in any master’s program.
He said, “if your answer is to make more money, get a better job, and that’s your only answer, it’s probably not a great idea.” You can still get a job with your bachelor’s degree without needing a master’s degree. Also, you will save yourself from student loan debts and from spending more money than you would earn back.
But, if you can find a program that will help you gain new skills and improve your scope for getting higher salary jobs, you should consider doing a master’s. If you believe you will get a return on your investment in the master’s degree, then only should you make the investment.
For example, teachers with a master’s degree are offered higher-paying jobs than teachers with just a bachelor’s in education. Similarly, The Foundation for Research on Equal Opportunity’s (FREOPP) study stated that master’s degrees in law, medicine, and dentistry have positive returns, often more than $1 million. Thus, it comes down to the field of the master’s degree you choose.
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