The College Bubble

Is it about to burst?

Point is, little of the data that colleges provide really tell you much about the value of your investment: the quality of the education, the experience of the students, or how the graduates fare later in life. Instead parents have long accepted the value of the diploma on faith.

MoneyFeatures at

From an economic point of view, in other words, a college degree costs more and more and returns less and less. Kind of like a hot stock with a price-to-earnings ratio of 32, it’s a prelude to a crash.

Why are the wages of the college-educated declining? A big part of the answer is that the pool of college graduates is rapidly expanding. It’s not surprising that as college becomes more universal, the return on a college education falls.

As the number of job applicants with degrees rises, employers become more sophisticated in assessing the value of any particular degree.

The Week

Consumers who have questioned whether it is worth spending $1,000 a square foot for a home are now asking whether it is worth spending $1,000 a week to send their kids to college. There is a growing sense among the public that higher education might be overpriced and under-delivering.

The Chronicle of Higher Ed

As I am sending my son off to the leading state university, I am thinking about this. A lot.

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