The question ‘What kind of future are we leaving for our children?’ came to me during the last week or so, as I had several conversations with friends and family about University fees, and work prospects.
In the UK fees have recently increased from around 3,000 pounds per year to 9,000, at first glance this looks like a significant jump, but not too prohibitive.
But after a discussion with my son about some of his friends who are doing 4-5 year degree courses, who have to pay for accommodation, etc, and who’s parents can’t afford to contribute, this pretty quickly leaves them with debts of over 50,000 pounds when they complete their studies.
This is a significant burden to put on our best and brightest and one I am not too sure that they will all be able to recover from.
The problem becomes even more compounded when you look things like house prices, with average property prices now getting to levels where they are 5 to 6 times the average wage, and the job market where more and more work is becoming commoditised and outsources and sent overseas.
With the inflation in the number of people with degrees, just having a degree is not enough to guarantee you a job, you often require further degrees, which then increases the level of borrowing and debt in order to pay for these degrees.
So we are producing a generation of bright students, who are qualified, but with lower chances of finding a good job, who won’t be able to afford to buy property as they are already hampered by a significant debt.
In the UK these student loans attract annual interest, around 6%, but the loans don’t need to be paid back until you earn above a certain amount. Which means that these debts are increasing over time at a rate of 3000 per year!
I know that the UK is not alone with this kind of approach, and in the US costs seem to be even higher, but what kind of impact is this going to have on this next generation and future generations.
I know when I did my degree it was fully funded by the government, and I even received a grant, which meant that at the end of my degree I have very little debt, possibly as low as 500 pounds and for many of my friends it was the same. At that time 500 pound was equivalent to about 1 months wages for a graduate, so a low level of debt, which could be quickly paid off.
The fees increase came as a result of the global financial crisis, something that non of these graduates was involved creating, so it does seem rather unfair to make them pay for it.
But when we take this kind of approach to charging students and yet we let companies such as Google, Starbucks and many others get away with paying next to no tax, something seems to have gone very wrong with the world.
It really does give me grave concerns for the future. It feels like our governments are taking a very short term view of things and I cannot see how this can be a good thing.
Like the song says, ‘the children are our future’ and burdening them with high debts, lower job prospects and an expensive cost of living, just cannot possibly be the best way forward.
It should be the obligation of every generation to make the world a better place for the next generation, and I would say that we have failed to do that.