Eager to consider alternatives to college education, 75% of Gen-Z believe a good education doesn’t mean a traditional college degree. And 66% don’t want college loan debt burden-confirms a survey by Gen Z Guru.
They have a point. College tuition has increased 145% since 1971, 8 times more than wages. Our $1.4 trillion national college student loan debt outplays the national credit card debt ($850 million) and auto loan debt ($1.28 trillion).
Is Debt Diploma Worth It?
With over 40% of college graduates underemployed, is college worth the exorbitant expense? Taking unrelated jobs (just to earn wages to pay back loans) graduates earn $10,000 less—a financial setback that can stretch to over five years following graduation. More men with desirable STEM degrees are employed than women.
Jonah Stillman is the Gen-Z partner at Gen Z Guru management consulting firm he owns with his Gen-X’er father, David. The two authored Gen Z @ Work on his generation’s role in the workforce, based on three national surveys and the first global study of 4,000 teens. Their findings concluded that the Gen Zs are ready to fight for what they want.
“While 75% of Gen-Z say they believe they can get a good education without a traditional degree, a vast majority of Gen Z is attending a 4-year college,” Stillman explained.
Some 67 percent of the 2017 high school graduates are in college and over 70% percent, or 45 million of full-time undergraduate students have college loans. Post-graduate life begins with on average, more than $30,000 in debt and a monthly loan payment of $400. If they don’t default, they can pay off in 10 to 30 years after graduation!
“The biggest favor we can do for young people, before they graduate from college, is to help them understand the overlap between what they’re passionate about, what they’re good at doing, and what pay scale they should expect,” says Peter Russo, President of Blackburn Energy.
Russo is a serial entrepreneur and investor with long-standing interest in educational options, holding board positions on various education-related organizations. He was also Director of Growth and Innovation for Massachusetts Manufacturing Extension Partnership/MassMEP.
Apprenticeships Boost Employability
Since January 2017, U.S. employers have hired over 650,000 apprentices, according to the U.S. Department of Labor. Earning industry-recognized certification to complement educational components with real-world work experience makes apprentices highly employable. Some 94% of apprentices are employed and earn on average a $70,000 annual salary.
“Fifty-five percent of Gen Z feel pressured from parents to gain early professional experience,” Stillman added.
They don’t favor classroom instructions with no direct correlation to their future. To win with Gen-Z, Stillman urges universities and schools to integrate real-life scenarios into their curriculum.
“Gen Z will be the generation to pioneer alternative learning. We are already seeing big companies dropping their degree requirements, which to me, says the future of education will look very different in the next 5-10 years.”
But Russo underscores the importance of employers driving the education and the student, not the reverse.
The 2017 report by Deloitte and The Manufacturing Institute warned of the 2 million workers shortage in the manufacturing industry between 2015 and 2025. With an aging “boomer” workforce ready to retire, the growing manufacturing sector is facing a serious lack of younger, trained talent in the pipeline and is investing in apprenticeships.
In working with employers and companies to strategically plan for evolving customer needs, technology requirements affecting plant and workforce, and future workforce gaps, Russo helps organizations test the needs of the changing “workforce on the company culture, and the needs of a manufacturing plant” in training future employees. With employee involvement and insight, employers can determine their ideal future employees and the resources they must provide and invest in to secure the future workforce.
College Degree Not A Fit for All
Colleges and universities can grab Gen-Z attention by shifting their recruiting message to include a dose of reality. After all, 64% of Gen-Zers know what they want to do before they go to college. They want to know “how long it will take to get my degree, how much it will cost, and why they are better than other universities,” according to Stillman.
Pursuing alternatives to college education isn’t a new idea. Innovative entrepreneurs like Bill Gates, Mark Zuckerberg and Steve Jobs dropped out of college to pursue their innovative ideas.
Susan Lyne, AOL Brand Group CEO, is a GW University drop-out, worth $4.7 million.
Debbi Fields of Mrs Fields Chocolate Chippery, a community college dropout, opened her first cookie store in 1977 and sold the company with $400 million annual revenue.
Michael Dell dropped out of the University of Texas to become the youngest Fortune 500 CEO at age 27, with a net worth of $20 billion. Just to name a few.
There are alternatives and programs like the Thiel Fellowship, founded by the conservative libertarian, serial entrepreneur and co-founder of PayPal, Peter Thiel. The program recruits young thinkers “who want to build new things instead of sitting in a classroom,” the two-year fellowship offers a $100,000 grant but requires fellows to skip or leave college. And they get full support from the foundation’s network of founders, investors, and scientists to help them succeed.
Dropping out of college to pursue a dream or innovative idea isn’t for everyone. Russo underscores the importance for high school or younger students to determine the job or a career they want to work towards and its long-term effects on their lifestyle.
“Society and the market put a value on specific education for particular jobs and even specific schools for certain jobs,” Russo offers a simple recipe for mapping out success.
“Examine the market and talk to employers about their future needs. You may find these and other suggestions. For students wanting a well-paid independent business ownership, vocational high school followed by community college courses in business (marketing, customer service, and financial proficiency) may be the best route. An interest in engineering with aspirations to be a manager or business owner calls for enrolling in a program offered by such schools as Worcester Polytechnic Institute or UMass. For technical-minded students interested in a white-collar environment, structured work schedule and minimal accountability pressure, a community college and a job at a large medical or tech company as a technician is perhaps the best plan.”
Those aiming for very high-paying jobs in finance a “pedigree university and grad school” are ideal if they want to work at a large firm. There are well-paying jobs in financial services for state school graduates with a major in accounting which can lead to job opportunities as a CFO in a smaller company, Russo says.
Some 32% (61 million) of our nation’s population are Gen-Z–born between 1995-2012. The tech-savvy generation, born into a digital world, spends over 10 hours daily online. They use apps to search for deals on travel, dining, gadgets and opt for experiences over material goods. Think: subscribing to Netflix in place of buying DVDs.
They shop at thrift shops. Want to be highly successful and land stable jobs they can stay for a while. They opt for service-oriented jobs they can start quickly and without additional education. While tech jobs are at the top 4 of the list of a recent survey jobs Gen-Z’s are interested in-they follow with day care assistant, beauty consultant, bridal consultant, photojournalist and booksellers.
The Gen-Z is less trusting of large corporations. And refuse to be mobile brand billboards for retailers pasting large logos on clothing and accessories. They’ll learn how to play the guitar by watching YouTube videos-not pay for lessons. And that includes online certificates and courses.
“I truly believe that Gen-Z will be the generation to change so much of the world we know today, well beyond just higher education,” Stillman says.
“So often when a new generation shoes up, people go right to the place of deciding which generation is right, who is wrong, who is better, and who is worse. Instead, I encourage people to understand that we are all just different and that’s not a bad thing.”