In the old days, tuition was cheap, and a grad student had a good chance of picking up an instructor's job or a research assistant position to help pay the bills. The cost of living was low in a lot of college towns, and there were plenty of bars, live music, and sexually active young people.
Not a bad life! And you could tell your parents that you were in graduate school instead of admitting that you were out of work.
It's not surprising then that in the recession of 2008-2009, a great many unemployed Americans flocked to graduate school. Graduate school seemed like the right place to park until the economy rebounded. And a master's degree, students told themselves, would help them get back in the job market.
To meet the growing demand, the universities ramped up their graduate programs. Like a medicine-show huckster at the county fair, the colleges rolled out all sorts of new master's degree programs in such fields as sports management, emergency management, hospital administration, criminal justice, and law enforcement.
And of course, the big lure for a lot of young people struggling in a faltering economy was the MBA degree. All the elite universities have had MBA programs for years: Harvard, Stanford, M.I.T., etc. But, a few years ago, the regional public universities and second-rank private colleges got in on the act. Some rolled out online MBA programs or so-called "executive" MBAs that offered classes on weekends.
Unfortunately, many of the people who got graduate degrees over the past decade saw little or no economic benefit. So many people obtained them for a time that employers saw them as nothing special. As The Economist observed in an article published almost four years ago, "Simply put, MBAs are no longer rare, and as such are no longer a guarantee for employment."
But the most significant danger of going to graduate school is cost. Under the Grad Plus program, students can take out federal student loans for the entire cost of their degrees, including living expenses, no matter how much tuition that a college or university charges.
The University of Texas, for example, now pegs the cost of getting an MBA degree at its Austin campus at $100,000 for its two-year program. Graduates who borrow the entire sum will enter the job market with $100,000 in debt.
So if the current Recession throws you out of work, don't go to graduate school without giving it a great deal of thought. A master's degree might improve your chances of getting a good job, but it might leave you with no prospect of a job and a mountain of student-loan debt--debt that is virtually nondischargeable in bankruptcy.