Education Inflation

It feels like everyone I know is going back to school for a master's degree.  This is probably not a surprise given the state of the economy, but even if we exclude the recent crisis and look at the long term trends, we can see that more and more people are going to college and graduate school.  While on the face of it it appears great that so many people are attending college - this was one of Bush's many goals - it might not be such an absolutely great change.

It seems to me that we are undergoing education inflation.  Where many years ago a high school degree was good enough, now a college diploma seems to be a necessity for many jobs.  While college in theory offers added education and skills, this change ends up devaluing the High School degree.  The more people there are with college degrees out there, the less a H.S. degree is worth.  Plus, some high schools, end up not doing as good of a job, as they believe some of their weaker students can go onto college and improve more there.  The same holds true for master's degrees.  Many students go straight from undergrad for a master's in all sorts of subjects.  Once again, it adds education, but how much does it really help.  Do you really need an MBA for many of the jobs out there?  How many lawyers can our country have?

The main issue though for being aware of education inflation is debt.  Attending many colleges and graduate programs pile on so much debt students that some students have a hard time ever paying it off.  So who benefits from all this grade inflation?  The financial institutions which make the loans and of course the colleges.  Many universities use certain graduate programs such as business school to subsidize their other programs. Some people have even said that the high cost of education was a contributing factors for so many talented college graduates heading to Wall Street - they had to pay off their loans.

Additionally, look at the entry of Kaplan Test Prep into the college market.  Kaplan is a well run and successful company.  They are entering the college market not only because of the online opportunities, but because it is a profitable market.  Now, people will be able to get their second or third degree without ever stepping foot in a classroom.