85% of college graduates move back home

[elessar78]

I don't blame my university. But in retrospect my immediate department/college could've done a better job pointing us in the right direction. Instead, THEIR emphasis was on passing finals and doing well on a panel interview about our body of work. I had an internship the summer of my junior year but I didn't get out of it what I should've. My fault. But the big majors (accounting, engineering) always had events to match potential employers with upcoming graduates.

[Redraidernurse]

I think it is unfair to assume that because the unemployment rate is 15% - that should mean only 15% of college grads are without jobs. College grads are some of the people having the most difficult time trying to find jobs right now because there are jobs available - FOR EXPERIENCED employees. Very few junior level entry positions available and the ones that are gets tons of applicants.

[cptacek]

I moved home after I graduated from college because my parents asked me to. My dad had hurt his shoulder and couldn't do any farm work, so they asked me if I could literally be his right hand. I was home for three months, then went to grad school. But I tell you, my older sister must have thought I was sleeping in every day and partying all night the way she thought I was "mooching" off of them. I finally had to have dad straighten her out a bit, by saying he didn't know what he would have done if I hadn't come home. They paid me $1400 for 3 months work, but I didn't have to pay for anything other than my cell phone and my gas. I didn't have much time for anything else, though!

I moved home for a month after I graduated from grad school before my job started. Then moved 8 hours away from home.

Moving home and just staying, after getting a job, is just foreign to me. I wouldn't even think of doing that.

[disneysteve]

I think it is unfair to assume that because the unemployment rate is 15% - that should mean only 15% of college grads are without jobs.

That might be true, but still, I'm quite certain the unemployment rate is NOT 85%. There is a sociological trend occurring here that can't be explained by the job market, inflation or any other financial data. Adult children are staying with their parents by choice despite having the means to live independently.

I moved home after I graduated from college because my parents asked me to. My dad had hurt his shoulder and couldn't do any farm work, so they asked me if I could literally be his right hand.

Certainly, there are situations where having the graduate move back home is to everyone's benefit. A sick parent, a family business, an unemployed graduate, etc. I'm not knocking people who do it out of legitimate need. I just personally can't comprehend 85% of graduates moving back with mom and dad. That is way too high a figure to be explained by financial issues alone.

[cptacek]

Certainly, there are situations where having the graduate move back home is to everyone's benefit. A sick parent, a family business, an unemployed graduate, etc. I'm not knocking people who do it out of legitimate need. I just personally can't comprehend 85% of graduates moving back with mom and dad. That is way too high a figure to be explained by financial issues alone.

Understand. 85% is just unbelievable.

[jIM_Ohio]

This is a really pathetic trend that is unjustifiable in the vast majority of cases in my opinion. Just look at this article. The unemployment rate is "nearly 15%". If that's the case, why isn't the percentage of college grads moving back home about 15% rather than 85%? That means that the huge majority of grads moving back home have jobs. They are just choosing not to be independent adults and get on with their lives.

I love my parents but when I was done with college, I was excited and anticipating getting my own place and starting my adult life. Today, it seems that kids don't think that way anymore if 85% of them are staying home with mom and dad. That isn't growth, it is regression.

Part of the problem is that kids are spoiled. They don't want to move out until they can afford the same lifestyle they enjoyed in their parents' homes. Not me. I moved into a studio apartment, slept on a sofa bed and dealt with the roaches in my kitchenette. But it was MY place. I could wake up when I wanted, go to sleep when I wanted, watch what I wanted to watch on TV and come and go on MY schedule.

We've tried our best to instill in our daughter that she will live away for college, not commute from home, and that after college, she will get her own place and live on her own, not back with us. We'll see how that works out but that's definitely the expectation that we are putting out there. I wonder about these kids who move back home but I also question the parents who allow it.

This article was posted on another forum I visit few days or weeks before Jeffery posted it here (sorry for not chiming in sooner, but I did not want to make same points twice). One point which I will offer as the counter point is this....

The amount of debt some people get from student loans is much higher than living on own will allow for payback.

For example in 1997 I graduated college with a salary of about 40k and about 90k in student loan debt. I had about $700/mo in rent, and after all bills were paid those first 2-3 years, I barely was postive (if I had a car repair or similar unexpected expense I was negative). I could have probably rented for cheaper than $700, but with speed of which I moved and was hired, finding a cheap place to stay was not something I had time to shop for.

8 years later I had that debt down to zero and also owned a condo.

In 2007 (just 10 years later) anyone getting same education path I did would have about 120k-150k in loans and starting salary was only about 45k, maybe 50k. The rent cost is about the same... but the debt payments might have been double what I paid.

I have an engineering degree... anyone with a lower degree (say a liberal arts degree for teaching or a Business degree for other occupations) would have about the same debt with a much lower starting salary. The only way to make the economics work is to get the debt down from 120k-150k to something more manageable in a short time. The best way to do that is live at home and save on rent. Add to this if parents co-signed those loans, it is in their best interest to make sure the payments are made on time (and/or debts paid off), and keeping kid under same roof for a short time might be best way to make sure the loans are not defaulted on and the parents credit ruined.

The moving in has less to do with unemployment than it does to do with balancing a budget.
I do think some of it is the standard of living issue Steve mentioned, but I think more of it has to do with the debt load incurred by the students and how its best to handle 120k+ of debt with an income of less than 40k.

[disneysteve]

The amount of debt some people get from student loans is much higher than living on own will allow for payback.

anyone with a lower degree (say a liberal arts degree for teaching or a Business degree for other occupations) would have about the same debt with a much lower starting salary.

I do think some of it is the standard of living issue Steve mentioned, but I think more of it has to do with the debt load incurred by the students and how its best to handle 120k+ of debt with an income of less than 40k.

That's a valid point, Jim, and points to a bigger issue. Students taking out insane amounts of debt to get a high-priced degree from a prestigious school in order to do low-paying work that won't ever justify the cost of the education. You don't need to go to Harvard to be a kindergarten teacher or a supermarket manager or a utility company worker. Our education system needs to do a much better job of teaching students and their families how to match the education with the career goal.

So you are probably right. A lot of students are probably finding themselves stuck at home due to bad decisions along the way, borrowing more than they could ever hope to repay given their chosen career path.

[jIM_Ohio]

That's a valid point, Jim, and points to a bigger issue. Students taking out insane amounts of debt to get a high-priced degree from a prestigious school in order to do low-paying work that won't ever justify the cost of the education. You don't need to go to Harvard to be a kindergarten teacher or a supermarket manager or a utility company worker. Our education system needs to do a much better job of teaching students and their families how to match the education with the career goal.

So you are probably right. A lot of students are probably finding themselves stuck at home due to bad decisions along the way, borrowing more than they could ever hope to repay given their chosen career path.

Steve-

My point was that even IF good decisions were followed-
get a good degree (Engineering) at a good school (my school is a top 5 school with 99% placement of graduates even in this economy), the debt to starting salary ratio was still too high in 1997, and its even worse now.

I made good decisions all the way through- my tuition was financed, I paid for my fraternity dues (which included room, board, food and some beer too) with cash and my parents paid cash for my books... The tuition itself is the burden, and 20k for an engineering degree is reasonable to pay. The choices along these lines (for me) were about 14k per year (for 5 years) for a 99% job placement or about 10k per year at State U for the same degree with a much lower job placement rate.

Now that same premium is 24k per year vs about 15k per year at State U... with just about a 100% guarantee of job placement (if you complete the program, which is not easy to do- of the 700 Freshman, usually less than 500 graduate).

[disneysteve]

I made good decisions all the way through- my tuition was financed

20k for an engineering degree is reasonable to pay

I'm not arguing but just playing Devil's Advocate to some extent...

20K might be reasonable or it might not be reasonable. If you can't afford it and have to borrow an amount that exceeds your ability to repay it and still have a decent lifestyle, it is too much.

I have no problem with somebody going to a community college for 10K/year, a state school for 20K/year or a private school for 40K/year if the amount being spent is affordable and makes sense in relation to the degree being earned. Far too many students (and their families) go off to college without any thought of how much is being spent or what the end game is. Are they getting a degree in a field that can be reasonably expected to generate the income needed to justify the money being spent?

I borrowed a lot of money to go to school - over $100,000 back in the late 1980s when that was a lot of money. But I was going into medicine and even though that isn't nearly as lucrative as it once was, it still pays a decent amount and I was able to repay my loans in about 12 years while still living an acceptable lifestyle. Today, I hear of medical students coming out of school with $300,000 in loans and more only to enter practice earning not much more than I earn now. That is just insane in my opinion. They will have that debt for the rest of their lives. I doubt that they thought about that while earning their degrees.

[jIM_Ohio]

I'm not arguing but just playing Devil's Advocate to some extent...

20K might be reasonable or it might not be reasonable. If you can't afford it and have to borrow an amount that exceeds your ability to repay it and still have a decent lifestyle, it is too much.

I have no problem with somebody going to a community college for 10K/year, a state school for 20K/year or a private school for 40K/year if the amount being spent is affordable and makes sense in relation to the degree being earned. Far too many students (and their families) go off to college without any thought of how much is being spent or what the end game is. Are they getting a degree in a field that can be reasonably expected to generate the income needed to justify the money being spent?

I borrowed a lot of money to go to school - over $100,000 back in the late 1980s when that was a lot of money. But I was going into medicine and even though that isn't nearly as lucrative as it once was, it still pays a decent amount and I was able to repay my loans in about 12 years while still living an acceptable lifestyle. Today, I hear of medical students coming out of school with $300,000 in loans and more only to enter practice earning not much more than I earn now. That is just insane in my opinion. They will have that debt for the rest of their lives. I doubt that they thought about that while earning their degrees.

So the bigger issue is how much, what job and expectations.

For example my senior year of HS tuition was 9k at my college, and when I arrived turned out some subsidies were removed and tuition was close to 11k year 1 and was 14k by year 6.

My senior year of HS the quoted starting salary (average) was about 35k, and when I graduated the average was about 45k and mine was 39k plus a 10% bonus (I worked for a small software company, so I was OK with being below average). 99% job placement for graduates in both cases, and the other 1% went to grad school.

Translate that to the bigger issues

1) What field do you want to work in for next 50 years? Does that field need a degree? Architecture, medicine, pharmacy, law, management all need degrees, and 4 year degrees at that.

Today, I hear of medical students coming out of school with $300,000 in loans and more only to enter practice earning not much more than I earn now. That is just insane in my opinion.

Is it insane to do that if your job is going to make you happy? I won't put a price on happiness like that. If job will make you miserable, put a price on misery, but I would avoid trying to put a price on the happiness that a job brings day in and day out.

2) What is the cost of the education vs the expected career financial reward?

3) Can the education be cheaper and still give the same career financial reward?
This is a tough line to toe. Because if the plan is to work for a BIG corporation, then the undergrad school you attend matters little. This is because all the wage and employment discrimination laws we have prevent two people from doing the same job and being paid different wages.

If the plan is to work for a small or medium sized company, then the school you go to might matter- because it's possible a private school with more contact with industry (and research grants) gives you avenues to fund the small ventures which state U does not.

Not all state U are equal though. I would not compare SUNY Buffalo with Ohio State, or compare U of M Ann Arbor vs U of M Flint. Some big state universities (like U of M Ann Arbor) have access to the research too.

4) Does society value education too much?
The single biggest factor (macro factor) to an area's wealth is education. Richest city in USA is Washington DC and it has the highest education level of any city in country. It also has LOTS of colleges in the area. Another rich area is the Boston MA area, lots of good technical schools close by, another area is the SF/Sacramento area out west- lots of colleges in that area too.

Best thing to improve an area economically is to open a college or two or ten close by. Helps the local economy out.

[Seeker]

I'm sure it doesn't account for that, but still, 85% is an extremely high number and is up from 67% just a few years ago. Surely the racial/cultural mix of students hasn't changed that much.

I'd love to know the figure for grads who moved home 20 or 30 years ago.

Wanted to reply to this before I lost this again.... this is only one of the many articles pertaining to the rapid change of ethnicity across the US.

This article came out after the 1990 census results:

Census Shows Profound Change In Racial Makeup of the Nation - New York Times

1990 -- one in every four Americans claiming African, Asian, Hispanic, or American Indian ancestry.

1980 -- one in every five Americans.

1970 -- hugely different. I went to JrHS and HS in the 70's. It was rare to see anyone not white back then.

Now in 2010, I can drive by my old HS and I know that whites are in minority; it's rare that I see any light skinned person, or light-haired person.

California gets many immigrants, yes that's true, but whites do not have as many children anymore, they are losing the game in the number count. There was a TV show called Time Trax maybe a decade or so ago... it may take a bit longer time than was portrayed in the future tv series, but I think that that show was very predictive of the ethnicity of America as a whole.

---

Also it is very true that non-white cultures don't really push their children outside of the home... it's not a priority to get them out. Even though I am technically "white", my folks were born in a different country. They did not chase any of us kids out; we left when we were ready.

[Seeker]

Ok, finally read though all the comments and responses.

I think ultimately both expenses and costs of any college education today impact the choice to return home as well.

I don't think that anyone starting out on minimum wage (even if they can find that job) can even partially realistically pay their way through college anymore, not with more dollar help than a minimum wage would provide. Even 40 hours a week @ minimum wage. It's just not enough.

What does a semester of college cost today at a basic public state university? I know that each state is different and that times have changed greatly, but 20+ years ago I paid less than 10k for my college degree.

Costs have multiplied hugely in this area. In fact, college education costs are the second most rising costs in America (medical costs rise quicker, but education costs are second).

And I spent six years doing the college degree, because mid-way through my college education, I did happen to find work and I chose the PT work and PT student route. So you figure it out, six years, less than 10k (exculding rent off campus) and still a public state university (CSU, not UC system).

How much education will 10k buy today's students? One year?

I think students today do have a harder time finding and sustaining a job; the economy is not great and if you have no experience, then you will not be looked at for anything other than minimum wage.

But, I think there's also a bit of "attitude" built in there too. Students today do lack a certain amount of motivation and do not seem to be as self-sufficient as I felt that both my age/peer group was and is. Students today seem to rely more on peers for options and opinions instead of really going with their want/need.

To be social is okay, but not when it keeps you from your goals/dreams. The younger folks today, seem to be more followers than leaders; collaboratiors instead of doers; sorry if that seems harsh, but I do feel this from younger people.

I guess I really have a mixture of feelings here, because I know that each generation...that each and every decade seems to bring more financial need, in terms of rising costs for such basic human needs such as housing, food, medical, education.

These basic needs are pretty important to the future well being of every single person... but when salary, hours, and jobs are just not there... or do not meet with dollar needs of the younger people being out on their own.... just exactly what are they supposed to do?

Today, I would not have been able to do what I did some 20+ years ago. There's no way with the five or so years I had saved, that with today's prices I could have done what I did. I was making some $15/hour back then in my full-time job... my Supervisor's boss took me aside and told me that I had a great deal of courage to quit working to go back to school at that time with the money I was making back then. It was not a great time economy-wise either, but I had saved enough to cover myself even if I had gone the entire six years without getting any PT work.

It was do-able then... I'm not so sure that it is now.

[Sissta2009]

Getting a degree used to be a stepping stone to limitless career opportunities. Now it's more of a hiatus from living under your parents' roof.

Stubbornly high unemployment -- nearly 15% for those ages 20-24 -- has made finding a job nearly impossible. And without a job, there's nowhere for these young adults to go but back to their old bedrooms, curfews and chore charts. Meet the boomerangers...

So true - I hadn't heard exact statistics on this before, but I know many people who have moved back in with their parents after college. I think it's more socially acceptable now as well because so many people have done it. Used to be something to make fun of a kid for, but it's not like that at all now.

[tripods68]

The high price of education keep going up, year-end, year-out, faster than the rate of inflation and income. It's similar to a BUBBLE. If no one does anything about it, the bubble will burst eventually.

I've put myself to college with the help of GI bill, and working 3 part-time jobs while a Full-Time student. I didn't go to a 4-year University right-a-way. Instead I managed to take lower division classes at a locan Community for the first three-years. Transferred to a 4 year to State University once I completed my A.A in Business and prequisites for Upper divisions. Sure, it took me a longer path to get my degree (5 1/2 years to be exact) but at least I didn't end up having insurmountable student loans either. How's $12K sound to which I ended-up paying in three years after graduation. Thank you stock options!