College enrollment has dropped off by three million in the last decade, with a drop-off of one million in the last several years as a direct side effect of the Covid-19 pandemic. This phenomenon clearly does not bode well for the future of the United States’ economy and workforce, with students who attend low-income schools and come from low-income families being the most affected.
These changes are disproportionately affecting students from low-income schools and families, the very people who need higher education the most, and are erasing much of the work done in the last decade to help close the income and race gap between students, colleges, and socioeconomic backgrounds.
Enrollment in trade schools is skyrocketing
Trade schools have seen a 40% bump in enrollment across the board. Many students are enticed by the fact that trade schools are affordable and offer a quick turnaround, with students paying $16,000 or less for their program, and their training taking a year or less to complete.
Beyond that, those who complete trade school are all but guaranteed a job on graduation day. Their earning potential is often two or even three times higher than the initial cost of attending the program.
As many have found, the same cannot always be said about those who pursue a college education.
While the average cost of college at an in-state and public institution hovers at around $28,775 per year (according to Forbes) and taking off an average of four yers to complete means that trade students have a cheaper educational cost (between $16,000 to $33,000 for the entire program, or about equal to just one year of a public college tuition), can get work in their field more quickly, and can usually make more than their educational costs in their first year on the job.
Tradespeople make an average of $54,000 fresh out of trade school, which rivals the role average college student’s first salary of $55,000. It’s no wonder so many people are choosing to forgo a formal education for trade school!
The almost insurmountable cost of college combined with ever-growing inflation and a lengthy list of requirements just to get a post-college job, all for a low salary and with students having hefty loans to pay back, also play a key role in the downturn in the popularity of college.
The implication of fewer college-educated people, however, means that over time, the United States as a whole could face an economic downturn, as it gives rise to many more blue-collar workers. This can irrevocably alter the makeup of the workforce. Despite current unemployment rates being among the lowest they’ve ever been, the American people are already starting to see a shift in the labor market.
Already, we see a strain in the labor market when 25% of skilled workers in the U.S. exited the workforce following the Covid-19 pandemic. The economy has become so highly specialized that if the U.S. were to keep up the trend of losing college-educated workers, there could irreversible damage to the United States’ economy, deepening the ever-growing divide between the middle class and the working class, further reducing the ability to affect the global economy. This threatens to knock the United States out of the classification of a “global superpower.”
To make matters worse, much of the United States labor pool is outsourced, and we are seeing the rise of artificial intelligence and robotics taking over many jobs, especially minimum wage jobs. While none of these factors alone vastly affect the U.S. labor market, this is simply the tip of the iceberg.
So what can employers do when the makeup of the workforce starts to shift?
Employers could shift the focus on the years of experience rather than the type of education potential employees have, as well as offering more extensive on-the-job training, which is already commonplace in some industries.
Even for those with a college education, the requirements for entry-level jobs seldom match the salary, with many employers requiring a four-year degree, two or more years of experience, and fluency in different programs which vary from company to company.
Employers, if possible, need to offer higher salaries with fewer requirements, as many young people are finding the pursuit of college, plus the various other requirements don’t lead to much more than barely-above minimum wage jobs, and they’re drowning in student debt. Others hear those tales and are now feeling that college fruitless, so they forgo it altogether.
A post-pandemic society will look vastly different, and business owners must adapt to keep up.