[Click here for the official July COUNTRY Financial Security Index release + data]
It’s not just college students. Many college grads paying down loans and parents preparing to send kids to college are wondering the same thing: is a college education worth it?
More and more Americans say no.
In fact, according to the latest COUNTRY Financial Security Index, only 48% of Americans say college is still a good financial investment. That number is down for the sixth year in a row, from 81% back in 2008.
A Tougher Job Market
Perhaps post-grad job difficulties are to blame. Colleges and universities continue to have to prove their worth as young adults experience a post-grad “failure to launch.”
A majority of Americans (78%) say it’s harder for today’s college graduates to find employment that allows for financial independence than it was for past generations. This could be attributed to a “skills gap” as Americans are more likely to say finding a job comparable to their skills, or not having the skills to match what employers need, are the biggest obstacles for today’s college graduates (44%).
Despite a tough job market, a majority of Americans (54%) only anticipate it to take six months or less for a graduate to find a job after college. Another 58% say if they were a new graduate, they would rather take a lower paying job right away than wait to find a position that matches their skills.
But, college students and recent graduates (ages 18-29) beg to differ. This group is the least likely of any age group (49%) to expect it to take six months or less to find a job and the most likely (31%) to say they’ll wait for a position that matches their skills.
Return on College Investment
While a majority of Americans don’t think college is worth it, it’s important to take a step back and look at the big picture. According to the Federal Reserve Bank of New York, a graduate can earn nearly $1 million more over their lifetime than a non-grad, and the annualized return on investment for the money put into a college degree is about 15%.
According to the National Association of Colleges and Employers, the average annual starting salary for a 2014 college graduate is just over $45,000. So how much do new grads need? A majority of Americans (59%) say $40,000 or less is the minimum annual income a recent grad needs in order to be financially independent.