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The term “financial crisis” is quickly become the backdrop of our future career related woes. Children of the eighties worried about recession and OPEC oil prices. Corporate greed, personified in films like “Wall Street” created a picture for that generation of unbridled greed. Fast forward thirty years and students graduating this year will deal with memories of the “Global Financial Crisis”, bank bailouts, Bernie Madoff and the collapse of multiple financial institutions (Lehman Brothers, Fannie May, Freddie Mac, Bear Sterns, etc.). In the last 7 years, a quick look at Wikipedia indicates that no less than 30 major financial institutes, with a valuation of at least 1 billion dollars, have been acquired, bailed out or ceased to trade.
The 1% have become a symbol of our financial crisis. Behind every failed financial institute, is a high paid executive (I recommend the 2010 documentary “Inside Job”, in order to obtain some insight on how much wealth was created by executives while their corporations failed). Our generation, labels itself – for the most part – the 99%. We feel the disparity between the haves and the have-nots. We have a gut feeling that our economy is not destined for boundless prosperity and increase. Each student will face this reality as he or she proceeds through his or her graduation procession emerging as a potential employee.
This begs one question: where will I work after graduation? According to the NZ Vice-Chancellors’ Committee report on graduate destinations, at least 30% of us will not find full-time employment. Some of us will only find part-time employment, some will continue studies, others will simply remain unemployed and possibly unemployable. Amongst those of us that find employment, only 35% will earn over $50,000. Keep in mind, this data – prior to the economic recession and the latest available from the committee – includes respondents who have been employed for up to ten years. Add to this equation the current average student debt load of $30,000: up 65% from 2004 (NZUSA). The sum total is employment uncertainty and an average of 11 years spent paying off your college years (NZUSA). But everything is not all doom and gloom. There is hope at the end of this dark monochromatic fiscal rainbow. To see the silver lining in this dark cloud, we need to look at one more statistic: minimum wage. NZ has a consistently high Purchasing Power Parity (a metric that balances minimum wage against currency differences and purchasing power). In fact NZ has not fallen out of the top ten amongst OECD nations in terms of PPP. To make a comparison, Malaysia, a nation that provides NZ with numerous international students – and my home – has a minimum hourly wage of $1.64 NZD (compared to our $14.25 per hour).
You may have trouble seeing the silver lining from these figures. However, Malaysia’s vastly different economy may provide perspective. Most NZ engineering graduates (for example) will surpass the $50,000 average salary mark in their first position. But that is where the fault lies. In Malaysia, fortunes are made on the side of the road. The manufacturer of basic goods (plastics, raw materials processing, etc) or the small shop owner or the food seller sees returns. The positions for a highly educated engineer or technician are few and far between. Where they exist, Malaysia’s historical policy of racial favoritism makes the opportunities for educated, inexperienced foreigners and locals quite small. So this still doesn’t sound like a good thing! Well let’s adjust our perspective. In New Zealand, your employment prospects rest upon the availability of highly skilled specialist positions – you may have no need to understand your place or position in the nations economy. In Malaysia, and most countries in the developing world, your value is in your ability to produce. Production is the opposite of the financial sector. The financial sector collapsed throughout the developed world as it attempted to mimic value or manufacture intangible assets (such as derivatives). The developing world lies ready to capitalize on the first worlds financial folly as its value is so intimately tied to creating the tangible, measurable, real, quantifiable value (such as manufactured goods, raw materials and labor).
Whether in New Zealand or abroad, the ability to view each opportunity through the lens of real value and production creates a widely different perspective. The question of value in a chosen field
is no longer reliant on available specialist positions, but it is reliant on your ability to determine where real value lies. Is a course on the history of transistor development valuable? Well maybe not. Is a course on transistor creation relevant? To a select few – the world needs less engineers than you might think. Is a course on making transistor based products available to emerging markets valuable? Probably. Medical courses? Sure, as long as there are sick people? Agriculture courses? People need to eat. Accounting? Yep. Small Business Management? Sure as long as you plan to apply it. Quilt making? If you can find people that need quality quilts.
In the future when making decisions in this post-financial crisis world, the key could be weighing each opportunity, employment position and project in terms of what it actually produces. Feel free to be a bit picky when it comes to your education. According to the New Zealand Institute, “tertiary institutions chase bums on seats rather than provide education that will lead to long term economic benefit”. You are paying for it, you will use it as a springboard to your future. Avoid courses that make the university tuition money, actually look for courses that will benefit you and others. And if you are a real rebel who wants to obliterate his tuition repayments, get some industry related specialist training from low-cost institutes like Udacity, EdX, MIT OpenCourseware, 2U or Coursera.
The world is not going to eliminate tertiary degrees any time soon, but the economic reality is that we do not live in the 90s or the early millennium. Each one of us will need to pay for our degree – slowly. In a world where education does not directly correspond to income it is time to really start thinking about what programs we can engage that will benefit not just us (that type of thinking is what lead to the crisis in the first place) but the society around us. It is time to look at our degree in terms of production, not merely academic consumption.