Most people know someone who was affected by the burst of the housing bubble, but how about someone who has been impacted by the education bubble?
Well, what is the education bubble exactly? It's an expanding group of adults who have invested their time and money in a college education without receiving any kind of degree.
In the wake of the U.S. economic downturn over the last 5 years, many Americans have recognized education as the solution to their employment problems. This realization has caused the enrollment numbers for educational institutions across the country to skyrocket, and while enrollment numbers are up, so too are the dropout rates.
According to the US Department of Labor, some 35 million Americans have some sort of college credit but never completed their degree. While some education is better than none, the variances in the unemployment rates–for high school graduates, those with some college credits, and those who completed their degree–are staggering. With an 11 percent unemployment rate for high school graduates; 9.8 percent for those with some college; and a mere 4.1 percent for those with a bachelor degree, it's easy to see the positive impact of completing a degree. Graduates also have more success qualifying for better or higher paying jobs.
Many individuals for whom it was necessary to take out student loans are now required to repay those loans without having the additional earning potential they would have had by completing their degree. A 2009 report from the Department of Labor shows the default rate on student loans for individuals with some college, but no degree, was nearly 17 percent. The default rate for students earning a bachelor's degree, however, was a mere 3.6 percent. Perhaps this vast difference could be explained by an analysis of Commerce Department data which showed that in 2010, employed college graduates earned 37 percent more than college dropouts.
If you are one of these students who has yet to complete a degree, don't let the education bubble burst with you on it! Contact your advisor today to discuss completing your degree!
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