By Jeffrey McKenzie
In August, the unemployment rate fell from 8.3 to 8.1 percent. Unemployment among the 20-24 age group stands at 14.6 percent. Furthermore, there are an increasing number of graduates that are unable to find full-time jobs in their field, instead having to take jobs which pay less and make no use of their skills.
Americans with college degrees are faring better in the depressed economy than those with high school degrees: 8.8 percent unemployment for those with a high school education versus 4.1 percent unemployment for those with a bachelor’s degree or higher. This further demonstrates the value of having the financial resources to pursue a college education.
Although some politicians are calling for cuts in education spending and federal grant funding, this will harm new graduates who will be unable to afford degrees and will face difficulties finding employment. To counter this, the U.S. should stop cutbacks in education and consider implementing policies that increase the affordability of college.
During a speech to students at Otterbein University, Mitt Romney said, “Take a shot, go for it, take a risk, get the education, borrow money if you have to from your parents.” This advice is inconsistent with the reality most students face. Most students do not have parents with tens of thousands of dollars in disposable income to spend on a student’s education or jumpstart a student’s business or career. On a basic level, this reflects his disconnect with those who struggle to pay for their education.
While he suggests that they “get the education,” Romney does not explain how to do this. Tuition has skyrocketed across the country partly due to federal and state cuts in financial aid. Romney endorses Paul Ryan’s budget plan, which would cut federal aid further and leave approximately a million students without federal grants.
Students therefore have to “get the education” by incurring lots of debt and graduate into an economy where jobs are scarce. What they need most is a better job market. Romney’s plan would cut taxes on corporations and the rich and cut spending on public services and welfare.
There are examples of this policy in practice. Conservatives used to praise Ireland’s economic policy. When the worldwide economic crisis began, further praise went to Ireland for cutting its spending, which many believed would lead it to a quick recovery.
Instead, a third of Irish graduates are unable to find jobs compared to half that in the U.S., according to the Department of Labor. In order to avoid that outcome, the U.S. should halt cutbacks at the state and local level which slash education budgets.
Although this approach will cost more money, it will provide the U.S. with a stable future tax base and improve graduate unemployment.