Google Chairman Eric Schmidt took a not-so-subtle swipe at tech critics who say that college is overrated. “There are various people who run around and make claims that higher education is not a good use of your time: they’re just wrong,” he told the audience at the SXSW conference, where he was on stage promoting his book The New Digital Age.
The average college loan racks up $30,000 worth of debt and the students are thrown into an uncertain recession-wracked job market. The most notable critic is Facebook investor Peter Thiel, who claimed that higher education was a “bubble,” and set up a fellowship that invests in gifted kids who want to become entrepreneurs instead of attending college.
Tech investor and TechCrunch columnist James Altucher has fiercely argued that college isn’t worth the rising costs. “Not only is college a scam, but the presidents know it. That’s why they keep raising tuition,” he said.
Schmidt vehemently disagrees. “The economic return to higher education over a lifetime produces significant compound greater earnings.” It’s true, on average, economists find that college raises wages by about 15-30 percent. Despite the debt, it’s a wise investment for many students.
When asked about the difficulty in paying for college, Schmidt was adamant: “I appreciate it’s expensive and we need to fix that,” he said, but “figure out a way to do it.”
One potential problem with Schmidt’s statement is that it was an argument for the average student. It may be more advantageous for students at the bottom and top quartiles of the talent distribution to go straight into the workforce (or get vocational training). Case in point, Mark Zuckerberg dropped out of college, and I don’t think anybody would say he made a mistake.
Similarly, students who fail out of college are left adrift with little more than debt. A cheaper vocational school can be a better choice.
Schmidt also noted that — especially for gifted students — teachers should focus on teaching “grit.”
“It looks like the thing that separates out the capable students from the really successful ones is not so much their knowledge,” says Schmidt, “but their persistence at something.” In other words, if a kid quits at the first sign of trouble, all the natural intelligence in the world won’t matter.
Still, for the vast majority of students, Schmidt argued that college is worth it no matter what their goal.
“If all you care about is money, you should go to college. If all you care about is culture and creativity, you should go to college. If all you care about is having fun, you should go to college. Go to college. I can’t be any clearer.”
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