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Davis Journal

College and its alternatives – by the numbers

May 02, 2024 08:41AM ● By Braden Nelsen

UTAH—Many in Gen X, the Millennial generation, and Gen Z were all told in their elementary school years that college was necessary to secure decent employment. It was painted that, if these young people went to college, they would be granted a ticket to the American Dream – steady income, good benefits, their own home with a picket fence, the works. However, reality has proven a different scenario, and many Millennials and Gen Z are finding alternative paths to try and secure their futures. 

According to data from Forbes, 76% of college graduates held a job in 2021, proving that there is some truth to the guidance to get a degree. However, the average income for those holding a bachelor’s degree hovered around $59,600. While that may sound like a decent income, the numbers behind that total reflect a much more trying state of affairs for college graduates in the 2020s. For starters, let’s take a look at student loan debt. 

Student loans in the modern era are in dire need of reform. Predatory, and in many cases, necessary for a degree, student loans thrust thousands of students into a cycle of debt at a very young age, setting them off into adulthood in a condition all economists say they should avoid. A report from the Education Data Initiative shared that 64% of students pursuing their bachelor’s have some form of student loan debt and that on average, that debt falls in the neighborhood of $40-$60,000. 

Many students, out of necessity, will opt for the lowest allowed monthly payment, but, monthly payments still take a toll. Crunching the numbers gives us a much different look at the income of someone with a bachelor’s degree. In Utah, if someone was to make $59,600 annually, after state and federal taxes, their take-home pay would come to about $1,954 each month. Still, not too shabby, but, diving deeper, the picture gets a little more dire. 

Studies show that groceries in Utah will generally set a person back about $260 per month. Many Millennials and Gen Z can’t afford to buy their own house, so, they are likely renting. The data differs, but the general consensus is that rent along the Wasatch Front falls around $1,200 a month, on the low end of things. Add on a monthly utility bill of around $300, and a miscellaneous fund for medicine, gas, and other expenses of around $200, and the average bachelor's degree holder in Utah is looking at a monthly cost of $1,960. 

No wonder so many in these generations feel like they’re barely getting by. Sure, getting a master’s also increases the chance of getting a higher-paying job, but, there’s no guarantee, except the guarantee of more student loan debt. So, what are the alternatives that these generations are exploring? There are a handful, all with their own risks, but two prominent options rise to the top.

In 2021, ECMC research said that 61% of Gen Z polled said they were considering a “skill-based” education, rather than a traditional college degree. This includes things like coding, nursing school, cosmetology/barbering, and trade schools. These industries are constantly in demand, pay well, and offer the opportunity for students to enter the workforce directly. ZipRecruiter shows that as of 2024, trade school graduates earn an average of $67,000 a year, and often, have the opportunity for growth from that point. 

The other option, which a skill-based education can provide, is opening a business for themselves. Forbes shows a majority of both Millennials and Gen Z favor this option over a traditional desk job, and many have gambled it all on the prospect. Small business loans do incur some debt, but, with the right idea, a business owner can immediately begin paying off that debt, as opposed to a full-time student who would be hard-pressed to find a job that fits with their schedule, and pays enough to offset their debt. 

It’s impossible to tell what the future holds, but, if current trends continue, who knows? Perhaps future generations will let college and university degrees fall by the wayside as they pursue other options for income. After a time, college may become so inexpensive again that it becomes a possibility once more for the masses, and the tennis match between degrees and certifications will begin again.