Why aren’t colleges and universities educating students for the modern economy? The president of an information-technology search and consulting firm explains

SATURDAY, MARCH 9, 2013

Where the Jobs Are

By JOHN P. MCCREA | MORE ARTICLES BY AUTHOR

Why aren’t colleges and universities educating students for the modern economy? The president of an information-technology search and consulting firm explains.

I interviewed an interesting job candidate recently. He was interesting, well, like a car wreck. It’s always instructive to look at a disaster, especially if you want to avoid one.

I run an information-technology search and consulting firm in Reston, Va., called Achieve-it. The job candidate was a top-20 law school graduate—I’ll call him Mr. Overqualified, Esq.—who was applying for an entry-level information-technology job in the Washington, D.C., area. He was debt-ridden and desperate for work, but it wasn’t because he was unemployable. He arrived in our offices well dressed, had a professional manner, and actually arrived on time.

The ad he responded to asked only for a B.S. in a hard science and an aptitude with computers. So we were perplexed by his application, because not only did he have a J.D. from a top-20 law school, but he had already passed the state bar exam. He was more qualified to sue us than petition us for employment, especially for the job we had open. And that’s where the scary part comes in: Why would a guy with this pedigreed education apply for an entry-level job paying $20 an hour?

YOU KNOW THE ANSWER, of course: He has over $100,000 in student-loan debt. To hold it together for the moment, he was working as an Excel jock for a local firm and living with his parents. He was earning $8 an hour. When Mr. Overqualified stepped off the graduation stage at his law school, he might as well have been stepping off a cliff.

At least he was using his tech skills; he could have been earning the same amount slinging burgers at McDonald’s. Mr. Overqualified told us that yes, he regretted the time he wasted in law school; he wondered if he could ever pay off his student debt. Lawyering was once a reliable route to a big house, a nice car, and a productive life. Now Mr. Overqualified can’t even find the on ramp to the middle class.

I have employed more than 2,000 IT professionals in my career, so I know what it takes to get that first job, and more importantly how to grow skill sets so you can keep a job in our IT-driven economy. The technology and our economy change rapidly; our best candidates are using on-the-job training, and supplemental education, to keep pace. At Achieve-it, we listen very carefully to what our clients are demanding today and anticipating for tomorrow. Clients will tell you—but you have to carefully listen and then react. Education—the system that so spectacularly failed Mr. Overqualified—is only a starting point. It is not the end game. The goal is to get and keep a job that pays sustainable wages and puts workers on the road to future growth.

ALL IS NOT LOST for Mr. Overqualified. Even though he didn’t think of it as vocational education, he had learned computer skills on his own in high school, and actually taught some IT classes in college. While he was wasting time and money learning jurisprudence, he kept his programming and Excel skills strong via self-study. Note the irony here: The only education system that actually worked for him was the self-education kind. And it is what is going to help him work his way into the highest-paying career.

His top-20 law school and private education in general are not to blame; they’re in the business (yes, the business) of providing a service that’s in demand, no matter how misinformed their “customers” may be. If you’ve got foolish customers who will overpay for something worthless, who’s really to blame? Oh, right, the institutions that hand them the money, at high rates of interest, so they can buy the goods—law degrees, for instance—that won’t work for them. Cheap financing of education can put a young life underwater, just as junk loans for McMansions did in the housing market, where older lives were put underwater. Too much debt, too little equity in the product itself: the worker or the house.

The current administration has pursued a cheap-money approach to student loans in order to produce as many four-year-degree students (and not always graduates) as possible. Instead, the goal should be to assess which schools and degrees can be the quickest to bring well-trained workers to market. When workers emerge from their initial education and find jobs, they’ll soon learn what skills can drive their careers forward; that’s the time for graduate school or further training courses. That’s when speculation turns into investment: a known need, and then a wise outlay to meet it. Our economy needs the most cost-effective education/hire ratio possible, and we should also measure retention to make sure schools are meeting needs. Mr. Overqualified trusted that his expensive education was an investment; instead, it was a fraud. Let’s stop this nonsense.

In addition to funding just-in-time skills education, the federal government also should make credit easier for small businesses. Here at Achieve-it, we’re lucky enough to have excellent personal and corporate credit, but our local bank is willing to offer only a 7% line of credit to help us meet payroll and other business services. So the Fed is loaning to banks money at less than 1%, and the banks give small businesses—and only the best of those—an interest rate of 7%! And we wonder why the economy is stagnating.

SMALL BUSINESSES are responsible for 70% of the jobs created in the U.S. today. Shouldn’t they be receiving the cheap loans, to encourage more job growth? And, in a related question, where are the graduates I need with the degrees and skills that will help grow my business and get the U.S economy back on track? Mr. Overqualified would like to know, too, since he’s still in employment limbo. He has passed his preliminary interviews, but there are more to come.

Americans can only compete in the world economy if we have an accurate assessment of the skills that are needed for the jobs of today and tomorrow, and fund the cheapest and quickest ways to prepare students to step onto the playing field.

In fact, at age 20, Mr. Overqualified had already built the skills he needed for today’s economy largely through self-study. Had he come into my office then, the $20 an hour he might have secured would be a bonus on top of the work experience that would have been his true education. Once you’re in the game, you can add skills to keep playing.

JOHN P. MCCREA is president of Achieve-it, whose Website is achieve-it.jobs.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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