Gen Z is dropping the college dream. It’s time for America to catch up

For years, we have lamented the spike in college costs and accompanying student debt bloat while we teach high schoolers to covet admittance to a tiny sliver of prestigious universities — ones that refuse to enlarge incoming class sizes despite endowments the size of some small countries’ gross domestic product.

President Joe Biden’s first plan to relieve student debt is dead in the water, and the second is off to a slow start. Meanwhile, Americans’ confidence in higher education is eroding, and college graduates are surprised to find themselves still in the working class.

Colleges are finally lying in the beds they made for themselves. According to data from the National Student Clearinghouse, undergraduate enrollment dropped 8% from 2019 to 2022 and doesn’t show signs of recovering post-pandemic. “The slide in the college-going rate since 2018 is the steepest on record,” The Associated Press reported this spring, going on to paint those numbers as a crisis for Gen Z.

But is it really?

In an ideal world, the United States would have enough college graduates to fill job openings in sectors where higher education is necessary, and well-paying jobs would be available for those uninterested in a degree. Current conditions aren’t all pointing in that direction. But Americans’ new disinterest in college, as counterintuitive as it may seem, is among the ones that do.

To start, the U.S. economy right now is far friendlier toward low-wage workers than it has been in years.

The combination of pandemic-era stimulus checks and 10 years-plus of a downward-moving unemployment rate has created a tight labor market in which companies are being forced to compete for workers and, in reaction, are raising starting wages and offering more benefits.

Target, for instance, raised its starting hourly wage last year to $15 and as high as $24 for some jobs and announced that workers clocking at least 25 hours per week would be eligible for health coverage.

It’s no surprise that Gen Z has already cottoned on that the “math isn’t mathing” for going to college anymore. Why bother, if you can, as this viral TikTok jokes, make more money as a McDonald’s drive-thru employee than as a doctor?

It’s not just so-called unskilled work that is a decent option these days, either. I have a friend the same age as I am who didn’t go to college.

He is a welder and makes the same salary I do — and he has the benefit of not having had to pay off tens of thousands of dollars in debt. He loves history, and I told him off the cuff one time that he could always go back to college if he wanted to, to study history. “Why?” he said. I didn’t really have an answer.

I was simply parroting what American teenagers have heard for years. But after a long while of selling college as the ultimate achievement, the U.S. has now overproduced elites in the wrong fields and is in need of technical and trade workers like carpenters and plumbers.

Gen Z is paying attention: According to the National Student Clearinghouse, between 2021 and 2022, enrollment in trade programs from repair to construction went up.

Companies flush with money for clean energy projects from the Inflation Reduction Act will also soon come calling for technical workers, which Biden is taking care to highlight in his recent speeches.

Long story short, it looks like my friend will always easily find a job, whereas my future in the creator economy/journalism industry/white-collar whatever may be more precarious than I would like to admit. (Just ask ChatGPT.)

Kicked off by Maryland Gov. Larry Hogan last year, states from Pennsylvania to Utah are dropping degree requirements for state jobs. They, along with companies such as IBM and Merck, are part of an “emerging degree reset” that focuses more on skills than on a degree when hiring, a movement that has caught the attention of former President Barack Obama.

Options are growing for Gen Z and others to acquire those skills, too. Instead of a bachelor’s degree, job-seekers can complete, for instance, Google’s Career Certificates, online training for skills like UX design and data analytics. Entrepreneur Scott Galloway’s Section 4 runs business strategy “sprints” meant to make a business school education more accessible, and organizations such as Opportunity@Work are connecting applicants “skilled through alternative routes,” such as the military or on-the-job learning, with employers.

Even colleges are reading the writing on the wall. Experts are expecting them to significantly lower their costs for 2024.

Already, writes Jon Marcus for The Hechinger Report, the “pace of annual increases in tuition and fees — which for years rose three times faster than the cost of everything else — has for the first time since the early 1980s slowed to a rate that’s well below inflation.”

It’s clear Gen Z is dropping the college dream. It’s time America caught up and supported the notion that going to college isn’t the only route to financial success and the only one that deserves society’s accolades. Rather than panic at the “crisis,” we can look at the new choices Gen Z is making and say that we may be getting what we said we wanted.

Emma Varvaloucas is executive director of The Progress Network, where she tracks emerging, positive societal trends in the “What Could Go Right?” podcast and newsletter.