A degree is not that important in Singapore? Wrong!

“You own a degree, but so what? You can’t eat it. If that cannot give you a good life, a good job, it is meaningless.” Well said Mr. Khaw, during a recent dialogue session. But let’s pause for one second here. The whole statement is dependent on one key word, “IF”. Mr. Khaw, being an experienced politician, knows how to make a statement that is always right. The real question here is to ask “how likely will a degree give you a good life and a good job?”

Yes, you’ve seen degree holders who cannot find a job. You’ve seen degree holders who work for long hours without the time to enjoy life. But how about non-degree holders? Are they all enjoying their lives and work? Are they work for eight hours a day and earn ten thousand a month? Well, unlikely.

We all tend to see outliners as the norm, we are naturally more drawn towards what is more interesting. But to perceive things or make decision based on outliners is risky; what we need is the performance of the average Joel.

What do the numbers say?

Statistics come in handy here to tell the story of the average Joel. Numerous studies have shown that there is positive correlation between one’s years of schooling and one’s earnings after graduation. That means the more schooling one has, the higher will be one’s salary. The biggest jump in earnings is 37%, which happens when one transits from high school to university, meaning between a non-degree holder to a degree holder. That means someone with a bachelor’s degree is going to earn 37% higher than someone without a bachelor’s degree. That’s a huge difference. While what happens to the income of your cousin A or uncle B may not be representative, statistics really show us if you want to earn more on average, go for a degree. Statistics don’t lie.

NOTE: Use graph to represent the 37% higher earning of degree holder compared to non-degree holder. Just draw 2 simple bars, one taller than the other.  Use powerpoint or other software u prefer.

Are you going with the trend?

Moreover, how much you will earn is also related to the general economy trend of the country. Singapore as an advanced economy may not be an extremely good place for low-skilled or even some medium-skilled workers. If you want to work in a call center, you’d better apply for a job in India or the Philippines. If you are good at operating factory machines, China could be a good place to go.

It is not true to say that Singapore doesn’t have such jobs, but such jobs are increasingly coming under pressure as Singapore is focusing on more sophisticated, service-oriented economy. The influx of foreign workers and the relocation of certain functions by MNCs into lower-cost countries may present a down-ward pressure on the salary of certain groups of workers.

And it’s not fault of the government. Globalization is the ultimate force that determines who is the winner of the game. If you hold a degree, you hold an extra insurance against competition in a globalized world.

So should you try to get a degree?

But does that mean everyone should try to get a degree?

No, from a policy perspective.

Yes, from an individual perspective.

What do we mean by that? The value of a degree lies with its scarcity. If everyone graduates from university, employers have no way to differentiate applicants by education. Holding a degree, people may not be willing to do jobs that they think don’t fit the status of a degree holder. This leads to graduate unemployment that is happening in places like China and Taiwan.

But you are not a policy maker. You are an individual who’s working hard for your future. Put the grand concerns of graduate unemployment and others aside. In most cases, having a degree is important for you. It most likely gives you a higher income, and also more choices. You can choose to do what people without a degree are doing, but not the other way round. In many competitive jobs, having a university degree is the first criterion of application.

Wait, I think I’ve got a different plan

But what if you already know what you want to do in the future, so you may just go for more specialized education without getting a degree. Well, let’s assume you are really sure what you are going to do ten years down the road (big assumption!), what is the thing that you want to do which is not offered by a university program? Most university programs are comprehensive. Even they may not be as specialized, the extra competitiveness that a degree offers you is very valuable. And you can always choose to dive deeper into a subject in university outside classroom, leveraging on professors and university resources, while graduating with a degree.

That sounds too theoretical? Then check out the story of this amazing student who chooses to go down the usual path of studying for a degree, while still holding on to his entrepreneurship dream of running his own company that is worth million dollars. If he values a university education, why not you?

To say a degree is not important is to go against the old wisdom about the importance of education. In today’s society where university represents the hallmark of modern education, there is little reason for you to say no to it. It is always safer (and perhaps wiser) to assume we are more like the average Joel than Bill Gates, a Harvard dropout. Don’t forget, before Bill Gates quit Harvard, he actually managed to get in first.