Lower Tuition, Lower Job Prospects

by Alex Vronces

31 May 2012

Who primarily benefits from a tuition rate reduction? Thanks to inflation, it is without a doubt only the students who attend university around the time of the cut!

In Quebec, monomaniacal students are taking to the streets in opposition to the exorbitant debt they will have accumulated upon graduation. During a segment on Sun News on May 26th — in what could have been easily mistaken for deadpan humour — one of the protest’s apologists disapprovingly put a laughably low number on this debt.

Some commentators hold these anti-tuitionists in derision, admonishing the laziness and the sense of entitlement that spurs the movement. Be that as it may, other people, myself included, deem the desires of these students to be utterly pernicious.

Who primarily benefits from a tuition rate reduction? It is, without a doubt, only the students who attend university around the time of the cut — that’s all folks! The common misconception among the proponents of arbitrarily low tuitions is that there will be one direct consequence, namely softened debt loads. There is also a second indirect, insidious repercussion that may be even more momentous than the former.

Increasing the extent to which post-secondary institutions are subsidized makes education of this kind more accessible to the public, enticing some who never considered enrolling to enroll after all. The lower tuition fees triggers an influx of new students, reifying a situation wherein the supply of undergrads seeking employment exceeds the demand.

In response to this, rather than settling for undergraduate degrees, people will begin to pursue graduate degrees in their respective fields to ensure their credentials surpass that of their competitors’. Soon after, a graduate degree will become a necessity instead of an asset, which will unprecedentedly increase the amount of time and funds that people must expend to acquire the skills necessary to earn a living. Some would argue that this process has already materialized.

Credential inflation is far from myth; it is a manifest reality. It is true that the constituents comprising a continually modernizing economy must also continually modernize their qualifications. This calls for reeducating oneself, for enhancing one’s credentials. This, however, is an unavoidable natural process. Conversely, such inflation produced by intervention can and should be prevented, for the subsidization of education unnecessarily misallocates resources. When perusing the evidence, it is difficult to refute this sentiment.

In 2007, Canada, the United States, and Sweden were home to 209, 289, and 734 Ph.D. graduates per 100,000 people, aged 25 to 29 respectively. This discrepancy can be ascribed to Sweden’s socialistic style of governance — where a formal education is as much a right as that to life. As we can see, the Swedish government’s munificent financing artificially incentivizes more people to spend more time in school to obtain a finer degree than is otherwise necessary.

The evidence also reaffirms the fact that such policies knock markets into disequilibrium. Unemployment amongst Ph.D. graduates is a prevalent issue in Sweden, more so than it is in Canada and the United States. In 2004, Swedish residents who held a postgraduate degree had a 4.3 percent chance of being unemployed, while American residents who held one in 2008 had a 1.7 percent chance of being unemployed. Indeed, I have the utmost sympathy for the Swedish biologists who enduringly earned a Ph.D., for they had nearly a 13 percent chance of being without work during the cited year, which is exceptionally higher than the Swedish average.

To lower the price of a degree is to effectively lower its real value, to make post-secondary education less attractive. Even the supposed beneficiaries of a rate reduction will yield poorer returns on their educational investment than those before them. Of course, as time elapses, people will begin to alter their decision-making in accordance with the existential circumstances; the problem is the transitional phase in which people will be unable to identify the potential negative impacts of their choices.

Not unexpectedly, education truly does save people from the oppressive blade of poverty that slashes so viciously at the morale of its subjects. That being said, the student protestors fail to discern the difference between education and institutionalized education. But they have clearly expressed that they can discern the difference between unjustifiably selfish, pernicious policy and policy that is not — unfortunately, they champion the former. Perhaps, rather than crying their eyes out for other people’s money, they should consider giving some of it back.

The views expressed in this opinion piece are the author's own and do not necessarily represent those of The Prince Arthur Herald.

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