Hire education: When the economy is tough, many return to the ivory tower
This article first appeared in the St. Louis Beacon, Jan. 28, 2009 - Rich Gaasch graduated from the University of Missouri, Columbia, with a degree in business administration.
He looked around for jobs. He networked. He found nothing.
And then he headed to graduate school.
"It wasn't part of my plan," Gaasch says. But now, instead of working 9 to 5, Gaasch puts in his 40 hours a week as a graduate assistant and student.
In bad economic times, getting that extra edge with a graduate degree made sense to the 21 year old, who is in his first year of the MBA program at Lindenwood University.
And in the past, economic downturns have sent other people back to school in large numbers, too, swelling both applications and admissions for graduate programs.
"The conventional wisdom is that when the economy is bad, more people go to graduate school," says Stuart Heiser, public affairs manager with the Council of Graduate Schools. "And historically, that's true."
In the recession of 2001, applications increased by 6 percent and enrollment of new U.S. students by 4 percent, says Heiser. But the real spike happened the next year, with an increase in applications of 13 percent, and in enrollment of 11 percent.
"The effect was definitely a lagging indicator of the economy," Heiser says.
Nationally, though, there's not yet a clear picture of the economy's current impact on grad schools, and CGS won't have data for 2008 until this summer.
Among universities in St. Louis, the picture is equally murky, but in general, while undergrad numbers are slightly down at several schools, graduate numbers are going up. "I think people are hesitant because they're not sure what's happening with the economy," says Matt Nolan, dean of admissions at Webster University.
- For instance, at the University of Missouri St. Louis, fall 2008 graduate enrollment numbers are up 4.9 percent from the same time the year before. And in the past five years, graduate admissions have risen 12 percent at UMSL, according to Bob Samples, associate vice chancellor for communications. "The trend is the economy's impacting everyone," he says. Undergrad numbers at UMSL fell slightly from '07 to '08 less than a percent.
- At Washington University, undergraduate enrollment numbers are down by 3.7 percent from fall of 2007 to fall of 2008, while graduate school numbers are up by 2.9 percent.
- At Webster University, undergrad numbers are down 1 percent from '07 to '08, while graduate numbers are up less than a percent.
- And at St. Louis University, undergrad numbers are up 3.4 percent, and graduate numbers have risen 4.3 percent.
Among some specific programs seeing higher numbers: At Washington University, architecture jumped 22 percent from the previous year, the University College program, which offers evening programs in several fields, jumped 18 percent, and business jumped 10 percent. There's been little change in the numbers, however, in graduate programs in art, arts and sciences, law and medicine.
The MBA program at Webster is also seeing an increase in enrollment, as are certificate programs, which can be finished in a year, Nolan says.
Another area growing at Webster is online. From the fall of '07 to the fall of '08, online course enrollment is up 6.5 percent.
Washington University doesn't offer online courses, but there was an 11 percent rise between 2007 and 2008 in evening and part-time graduate studies.
And at SLU, Kathy Day, assistant dean and director of graduate business programs at the John Cook school of business, says enrollment in the evening/part time masters program in business has gone up 15 percent, while the full-time program has gone up 22 percent.
That's partly due to a newer program, but also, she thinks, in a tough economy, people are eager to get their MBA and increase their skills, either to keep and grow in their careers or be more marketable with other careers.
WHO ARE U?
Cassie Gross recently got her master's in political science from UMSL and is now working on her dissertation. She hopes to teach at the university level. And if she's successful in that, Gross will basically never leave school.
Like Gaasch, Gross continued her undergraduate program straight through to grad school.
But is she a typical grad student? Are they most commonly young? Old? Straight from school or straight from the office? Have they been laid off and are starting over, or are they looking to gain an edge in their field with more education?
Basically, yes. All of the above.
"It varies pretty dramatically," says Evan Bouffides, assistant dean and director of MBA admissions and financial aid at the John M. Olin School of Business at Wash U. In the full time MBA program, for instance, the typical student is about 27 and has 4 years work experience. But there are people in their late 30s or 40s, too, and students straight out of undergrad.
At Webster, the typical grad student is between 24 and 32, though over time Nolan has seen the group starting to trend younger.
And at UMSL, Samples says the candidates have trended older, usually people wanting a career change.
Basically, it's hard to get an exact picture of the general graduate student population because there is no such thing. At each university, the students are clustered into their programs, such as business, education or arts and sciences. They differ greatly in age and experience, and those differences themselves lend their own advantages.
Gaasch hopes an advanced degree will set him apart early and start him out at a higher salary.
Unlike Gaasch, Babatunde Ilori spent four years dreading Sunday nights and waiting for Friday afternoons before deciding to return to school. Last summer, Ilori left corporate America and started in the MBA program at Wash U.
In addition to his MBA, he'll also have the advantage of previous work experience, which many schools recommend before starting a graduate program.
"We really value work experience, and we like to see a minimum of two years work experience," says Day.
While the corporate drag did weigh Ilori down, his experience in the real world will help him in the long run, he thinks, compared to students who came directly from undergrad. Internships are great, he says. Book experience is great. But it's nothing like working.
"When you have work experience, employers look at you differently."
Calculating the costs -- and the benefits
In many occupations, having a master's degree or higher does ensure a higher salary. According to the Bureau of Labor Statistics, a financial analyst with a master's will earn 47 percent more than one with a bachelor's. Librarians with master's earn 37 percent more, and elementary and middle school teachers earn 30 percent more.
And for Gross, there are advantages other than just money and a pumped up resume. Professionally, she says, she's better able to develop communications and networking skills. And personally, she loves the work and the environment where new ways of thinking are valued.
For many careers, the benefits are obvious, but the costs are, too.
Mark Smith, assistant vice chancellor and director of the career center at Washington University, often advises students not to consider grad school or professional school just because the job market is bad. In fact, he says, it's the worst reason to make such a decision. They're taking on debt, he says, and it can be some pretty hefty debt, too. Nellie Mae reports that average student debt for grad students is $31,700. That number doesn't include undergrad debt.
So far, Nathan Bell, director of research and policy analysis with the CGS, says the credit market's impact on graduate student lending isn't an issue. And though he has no hard data, the people who may be affected by that crunch probably haven't applied for grad school yet.
At the Olin Business School, the financial aid provided varies from year to year, Bouffides says, and despite the financial crisis, they're still giving out the same amount of scholarship money. Historically, he says, about half the students get some form of that money. The people who may have problems getting it now, he thinks, are international students.
And at Webster, Nolan says the amount of student loans given out are the same as two years ago. One change he anticipates is more businesses not helping their employees with education costs. At Webster, about one-third of grad students use employee reimbursement programs.
Like the hard-to-pinpoint typical student, how those students finance their education differs greatly, says Smith, from school to school. Most medical and law students finance their educations through debt, he says, while Ph.D. candidates finance through teaching and lab jobs.
Gaasch isn't adding to any debt because of his schooling, though. He looked at programs at different schools and chose Lindenwood because of a graduate assistantship, essentially paying for the program.
During her time at UMSL, Gross has taken out no loans thanks to a fellowship and a research/teaching assistantship.
And Ilori is also not going into debt for his education; he chose Wash U because of a full fellowship.
When jobs aren't numerous, there are options other than grad school, Smith points out. And often, he says, students distinguish themselves by choosing to give service to organizations such as Teach for America and the Peace Corps, which are selective, as well.
"We have seen an increase in applications," says Christine Torres, public affairs specialist with the Chicago Regional Peace Corps office.
Applications in 2008 increased 16 percent, she says. That's the largest rise in five years. In addition, last year, 44 percent more people age 50 and over applied for the Peace Corps.
Torres says it's hard to know if the economy is driving the application increase, but returned Peace Corps volunteers have an edge of their own, she thinks.
"The volunteers will tell you that they come out of a Peace Corps experience with a certain level of maturity and a definite level of life skills."
Teach for America has seen a rise in applicants, too -- another record, in fact. Last year, nearly 25,000 people applied to fill 3,700 teaching positions. That's a 36 percent increase over the year before, according to Rhonda Stewart with Teach for America.
And for the 2009 corps, which had a deadline of November, there was a 48 percent increase in application compared with the same time the year before.
Obviously the economy is one reason for this, Stewart says, but, both she and Torres think interest in such programs also comes from an increasing desire for public service.
While Gaasch chose grad school, perhaps it's already paying off for him. Many of his friends who graduated at the same time are still looking for work.
And, he says, he's not too worried about the economy. In a class where he's studying the markets, he recently learned something he hopes will prove true.
"You just gotta kind of have faith that the market will slowly go back up," he says.
Gaasch does, and he's hoping that once he's earned his MBA, his education will start working for him.
Up and down
University of Missouri-St. Louis
Fall 2007 undergraduate enrollment - 12,569
Fall 2008 undergraduate enrollment - 12,500
Change - Down .5 percent
Fall 2007 graduate enrollment - 2,974
Fall 2008 graduate enrollment - 3,122
Change - Up 4.9 percent
Fall 2007 undergraduate enrollment - 7,318
Fall 2008 undergraduate enrollment - 7,055
Change - Down 3.7 percent
Fall 2007 graduate enrollment - 6,270
Fall 2008 graduate enrollment - 6,452
Change - Up 2.9 percent
Fall 2007 undergraduate enrollment- 3,620
Fall 2008 undergraduate enrollment - 3,558
Change - Down 1.7 percent
Fall 2007 graduate enrollment 2007 - 3,203
Fall 2008 graduate enrollment - 3,221
Change - Up .56 percent
St. Louis University
Fall 2007 undergraduate enrollment - 7,556
Fall 2008 undergraduate enrollment - 7,814
Change - Up 3.4 percent
Fall 2007 graduate enrollment - 3,077
Fall 2008 graduate enrollment - 3,210
Change - Up 4.3 percent
Kristen Hare is a freelance writer in Lake Saint Louis.