The Higher Education Bubble

Posted: August 12th, 2013

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The Higher Education Bubble

The higher education bubble is a speculation by higher education sector observers in the U.S particularly that the higher education system is headed for a downfall. Judging from the accumulating financial debts students and institutions continue to incur, this perceived “bubble” is posited to “burst” in the near future causing a major economic imbalance in the country. It is my position that the higher education bubble is indeed imminent. Despite the observed increase in payments made to college graduates, data provided by the U.S government indicates that the underemployment of graduates from colleges is on the increase. These discouraging research figures will have a negative effect on the enrollment rates of universities in the near future.

Also worth noting is the high price of higher education in the U.S. This happens amidst poor economic times when most lower class families are in debt either from their mortgages or from student loans for their children. In this uncomfortable financial situation, families resort to taking additional student loans for their other children since they cannot afford higher education by their normal income. Additionally, the student loan financial institutions are estimated to crumble because of unmanageable loan defaulting. Consequently, college enrollments will also crumble due to inability to finance students.

Increasing college and university costs will also eventually burst the “bubble”. Institutions have skyrocketed student tuition fees to be able to cover for reduced federal government financial input. This burdens the students and institutions who additionally borrow themselves to cover for these increased expenses. Some courses, though highly placed, are less marketable while holding only a degree. These courses require extra funding to master, which most students do not have. Enrollment in colleges and universities is also posited to reduce based on this argument.