Student debt cancellation doesn’t help people deciding on college. Here’s what we should do instead.

I understand the call for student debt cancellation. As college fees continue to soar, so does student debt.

I’ve had my own bout with student debt despite earning full scholarships to Culver Military Academy and Boston College. Though my scholarships covered tuition, I still had to take on student loan debt to cover the additional fees.

By the time I graduated college, I had $40k in student loans even though I had “full rides”.

I’ve gone on to help over a thousand low-income youth go to college on scholarships through my nonprofit work, but none of this helps those who are deciding on whether they should go to college or not.

Student debt cancellation is a rally cry for those who have already gone to college.

But what about those who haven’t?

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Why is college deemed the sole path to the American Dream?

In America, we've accepted that college is a path to greater financial success and, therefore, more opportunities in life. While that's statistically accurate, it's not because college grad's wages are going up; it's because non-college grad's wages are going down. That's an important distinction to make. So we've accepted that as a path to the American Dream.

However, college isn't a path to achieving those goals anymore. The American Dream is not necessarily routed through college, yet there's still this symbiotic relationship between colleges and employers today.

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What is the symbiotic relationship between college and employers?

Well, colleges are obviously in the business of getting people to graduate and having that degree valued by employers. And in turn, employers are constantly posting job positions with degrees as requirements – even when you don't need one. That's why we're seeing massive degree inflation right now. But to be brutally honest, higher education has lost a lot of its value proposition over the past decade because knowledge isn't the domain of these universities anymore. Knowledge is accessible. Ubiquitously. The issue is actually curiosity and the curation of the knowledge. College showed us they're not exclusively in the business of education anymore.

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If college isn’t in the business of education, what is it in the business of?

Colleges didn't lower tuition fees during the COVID pandemic, yet the entire experience was virtual. So it just goes to show you colleges are in the business of credentialing. 

When we talk about the value of college, certainly socialization is the number one value, but secondly, it's credentialing. If you were to take credentialing away from colleges, where they had to prepare students to take a standardized test for say a bachelor’s in marketing degree, you'd have a much different education system focused on educational attainment as opposed to credentialing.

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Are people asking for student debt cancellation because all they got was… socialization?

The college system has been pushed on people, and as a result, they go into massive debt to go through said system. And the average debt per person keeps going up, AND it's not leading them down a path of financial success. That’s why they’re calling for student debt cancellation.

Since COVID hit, people have become more comfortable admitting that college isn't for everyone. Ok, great. But if we're moving away from college, what are we moving towards? 

This is where I want to help paint a picture for those curious. Remember, I have two degrees. I've sent thousands of kids to college on scholarships. I'm not talking out of my ass. I know for a fact there is a viable path for those who don't want to take on insurmountable student loan debt for a degree that might not hold any value. 

There IS an alternate path, but it'll take cooperation from multiple institutions to be successful. The first one, and I know many people will probably groan at this, is changing government policy around apprenticeships.

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What's an ideal policy to support apprenticeships look like to you?

First thing we need to have is a political will toward apprenticeships. Political will is vital because it means that people in positions of power need to agree that apprenticeships are viable. Bipartisan support is crucial for this. If politicians are willing to sponsor bills and legislation around building a solid apprenticeship infrastructure, it will change the game.

But of course, we have partisan politics getting in the way. Under the Trump administration, they had doubled down on a particular apprenticeship model known as an industry registered apprenticeships (IRAPs), which allowed industries to organize and create standards for apprenticeships rather than the current model of having the government do it. It is a much-needed update to the system that hasn't been renovated since 1936 and was primarily built for trades.

Then, unfortunately, the Biden administration overturned it. Don't get me twisted – I'm not a Trump supporter. This wasn't even a Trump thing; it just happened under his presidency. But now it's no longer in play…because of politics. 

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Why did Biden’s administration reverse Trump’s support of industry registered apprenticeships (IRAPs)?

The companies that have registered apprenticeship programs (RAPs) with the government were up in arms that funds would be diverted from their programs to industry registered apprenticeships.

So Biden’s administration overturned the support for IRAPs due to a lack of funding. Now we're back to square one. 

And this is why we need political will to be stronger than politicking – that's the only way we can achieve results that are best for our country.

If there were bipartisan support for the bill - it wouldn't have had to end there.

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What role do employers and parents have in pushing college vs. apprenticeships?

There are two constituents that we need to get on board. The first is business owners – and the obvious reason why I created Apprentix. The second is parents. Parents still see college as a defined, tried, and trusted path to success for their children. Especially parents who didn't get to go to college and regretted it. They usually are the ones who push college the hardest. 

On top of that, there is still a tremendous stigma around not going to college. And it's like – why? 

People ask me all the time if I'll send my kids to an apprenticeship instead of college. And my answer is, first of all, I'm not sending them anywhere. They're going to choose – but they're damn well going to be prepared for either. 

So we need that stigma to change. But on the other side of it, we need a pipeline of jobs coming from smart business owners who can see people's abilities and talents are a signal of them having the right stuff for a job – not just using a degree as a gatekeeper. 

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So why aren't businesses jumping on the chance to create apprenticeships and get employees in the door right away? Why wait for them to graduate college?

Think about it – many people managers who run businesses likely went to college. So there's an ego thing at play here. They might not want to admit that college isn't necessarily the answer to obtaining a job at their company, especially because they had to do it. They need to justify the value they got out of their own experience. 

Early adopters are going to be companies that are merit-based. Google doesn't require college degrees to work there. Elon Musk said the same thing about his companies. But not everyone can work at Google or Tesla.

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How can government policy better support apprenticeships?

The government provides FAFSA-based funding to college students in the form of Pell grants, Stafford/Pell/Perkins loans, subsidized work-study jobs, and school and private assistance in the form of scholarships, grants, and  private loans.

The government also allows individuals to save pre-tax money that grows tax free in a 529 plan known as a college savings plan. The money can only be used for qualified college expenses or else the money is taxed as ordinary income, plus capital gains, plus a 10% unqualified withdrawal penalty.

I’d like to see the government expand their policies to include apprenticeships. Allow apprentices to apply for FAFSA-based funding where they could qualify for more than just a Pell grant and use those funds to live while working as an apprentice.

Expand the definition of qualified expenses for 529 plans to include the use of funds while in an apprenticeship.

When you allow individuals the option to choose between college and an apprenticeship, because the financial aid and tax incentives are aligned, that’s when you’re really saying that apprenticeships are a viable path.

Because apprenticeships are directly tied to employment, it makes more sense to fund apprenticeships because there is a guaranteed direct path to repayment.

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How can nonprofits support apprenticeships as a viable career path?

We have tons of resources for kids who go to college – from mentoring, bridge financing, scholarships, grants, etc. It's wonderful. 

But we don't have anything similar for apprentices, which is crazy if you think about it. 

Apprentices live life while they're in their programs – paying rent, groceries, the whole gamut. 

I'd like to see more nonprofit services and funding being delivered to apprentices. 

Nonprofits could focus their giving to apprentices who match their organization’s purpose. E.g. a nonprofit who focused on helping low-income youth or veterans or the disabled, could give grants to apprentices with similar backgrounds.

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How can the private sector support apprenticeships?

Media

Media publications like US News and Barrons publish “best colleges” lists in order to sell more advertising on their platforms. The result is not only a glorification of college, but also the gamification of colleges to rank higher.

I would like to see publications ranking apprenticeship programs. Not only would that provide a great service to apprentices, but it would also provide a great deal of brand awareness for companies who hire and train apprentices.

Employers

I’d also like to see companies hiring based on skills, not education and experience. The move towards skills-based hiring will open up a labor pool that was previously unavailable, and will also help companies hire on merit which is better for their growth.

The result of skills-based hiring and training is a natural fit with apprenticeships which are skills-based learning and working programs. The more we can upskill current employees and entry-level positions, the better equipped a company will be to have the talent needed to match the needs of their business. Everyone wins but we need employers to stop pushing degree inflation and to hire on merit.

Parents

Lastly, we need parents to know about the value of apprenticeships and to know that apprenticeships are viable for blue and white collar jobs. Parents need to see success stories of youth going into apprenticeship programs so that they can update their own dreams for their children’s futures.

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