I have a friend whose daughter is about to graduate from law school. The proud parents are so excited (I’m sure, in part, due to their soon-to-improve cash flow situation) as is the graduate-to-be. Then I read that the Bureau of Labor Statistics estimates that the economy will create 21,880 jobs for lawyers annually until 2020…BUT, law schools graduate more than 44,000 graduates each year. That’s a deficit (sorry for selecting that overused word) of 22,120 graduates who won’t be hired–that’s MORE than the number of jobs that will be created annually.
It’s a good thing the government isn’t running law schools because they would be asking for law schools to “raise the debt ceiling” (creating more graduates without jobs) and asking employers and law firms who already have a full complement of lawyers to create more of their “fair share” of jobs for attorneys. OK, I’ll say no more, but you get the picture.
Toying with the idea of dropping out of college? Rethink that strategy for a couple of reasons.
A bachelor’s degree still remains the most efficient entry into the middle class, and college graduates have lower unemployment rates (4.1%), higher earnings (37% more), and better career prospects than college dropouts or high school graduates. In addition, the lower prospects of employment for dropouts AND student loans compounds the problem even further. A 2011 study by the Institute for Higher Education Policy found that 58% of the 1.8 million borrowers whose student loans began to be due in 2005 had not yet received a college degree. Some 59% of them were delinquent on their loans or had defaulted, compared with 38% of college graduates. In October 2012, there were 1.9 million unemployed college graduates with 33% of those under the age of 35.
The image of the value of a college education has for many decades been undermined by the education system’s failure to keep up with changes in demographics, technology, and the economy. Study after study also reveals that graduation rates for full-time students has been on the decline, where now it is 45.2% for low-income students and 39.9% for African-American students. For students older than 25, the graduation rate drops to 27% as the demands of part-time or full-time lower paying jobs and family obligations compete for available time and attention.
Whatever your degree or occupation and you are in the midst of looking for another job or switching careers, you have to be careful about deducting job hunting expenses. You can only write off those expenses (headhunter fees, postage, employment counseling, etc.) when looking for a job in the same occupational field as your previous work. So, for example, if you lost your job as a lawyer for a private firm, and are seeking opportunities as a corporate attorney, those expenses are deductible, but not if you’re moving into marketing, says SmartMoney.com.