College Is Making Your Kid Unemployable (Degree Free #203)

Ryan Maruyama [00:00:00]:
Welcome back everyone. Today we have a bunch of stuff to get to, so let's just get to it.

Hannah Maruyama [00:00:04]:
Yeah. So the first thing I want to go over is a question that I read in an MSN repost of a repost of a repost from an article that I think was in the New York Post. It was this 47-year-old dad saying, I make $140,000 a year. Should I go into debt for my kids' college? And basically it's this guy, obviously he earns $140,000 a year. He's feeling really guilty about the fact that he thinks it might not be the most responsible thing in the world to pay for his kids' college. Given that the average cost is, you know, $38,000 a year right now. And I think that this, this probably hits home for a lot of parents who very much feel obligated to do this, even when their children do not have a clear vision as to why or for what they are going to buy this degree. And I want to talk about this because I think that while this guy is definitely not a low earner, it's very much a huge burden because at that income, you're really not going to get too much help.

Hannah Maruyama [00:00:52]:
You're going to get a little bit of nonsense merit aid where they're just trying to pull you in enough to get the signature. To get you to sign your kid up for this 4 to 6 year paper purchase that they don't need. And so I think a lot of parents actually in this bracket are really hurting from this because, especially if they have multiple kids, because they're just getting dinged over and over and over again. And I have heard stories and we've talked about this, people, HELOCs on their houses, people delaying retirement, working second jobs, like working side hustles essentially to pay for this piece of paper that's not going to get their kids a job, that's not going to help them pay back any of the loans. And it's just causing a lot of financial havoc in these households from this mismatch in expectations, from the complete lack of translation to employment, to high pay, especially if there's some fuzziness on who's paying and who's paying what and some of these loans and some of these loans. And it just gets really muddled and really quickly.

Ryan Maruyama [00:01:45]:
I think you want to go down the path of like, hey, this is a good amount of money that you're making. And then when we talk about aid, you're not gonna get a lot of aid. For me, all of those things are valid and could be valid. I'm not sure. I'm not very educated on all those things. We're not a financial aid service to the—

Hannah Maruyama [00:02:04]:
Loan service. Financial aid is just loans.

Ryan Maruyama [00:02:06]:
Right, loan service to get them into college. And so I'm not really sure about any of that, but for me, that doesn't matter at all because those things are always moving, right? Like it was different 15 years ago when I was making these decisions. It was different 25 years ago when the people that are listening to this possibly are— when made those decisions, possibly even later. And those things are constantly changing. And so I'm not sure about that. But for me, the bigger thing here is the fact that parents are thinking about going into debt for their children's education.

Hannah Maruyama [00:02:43]:
I'm glad you put quotes around it.

Ryan Maruyama [00:02:44]:
This was just starting to be a thing, just in its infancy, 15 years ago or so, honestly, it was not really heard of, at least not in my circles, for your parents to take out debt to help you go to school. It was always, yes, we're going to fill out the FAFSA for you. And then that's pretty much it. We'll help you sign the loan documents. We'll help you— maybe not sign it, but like, we're not going to be a signer on it with you, but we'll help you figure out what you need. to get those loans yourself. That's what I mean. Not actually be another guarantor, another signer on the loan itself.

Ryan Maruyama [00:03:23]:
That wasn't heard of. That wasn't heard of in my household at least. And so for me, it's just more of this trend of the colleges due to the federally mandated bankruptcy-exempt loans. They have already bankrupted an entire generation, the people themselves. That's mostly the people listening to this podcast, unfortunately. And then they're like, Now the kids don't want to do it as much, but the parents still want to do it. Let's go get into the parents' wallets. Let's get into the grandparents' wallets.

Ryan Maruyama [00:03:55]:
And then exactly what you're saying, the downstream effects of all of those things. And like, the reality is for the parents and the grandparents are you don't have that much working life left. Your child has all of their life left to make all of that money. Let them sign the loans. And if they can't afford it, like if nobody's going to, if nobody's going to give them that loan, That's probably more signal than noise, right? Like, if it's like, well, they can't afford it on their own. Well, what are we talking about? If they can't afford it on their own, don't sign the loan with them. What are we doing?

Hannah Maruyama [00:04:22]:
Underneath this all, what's bringing this all to a screeching halt is the fact that you are tapping these people out so many times. As you said, it's— and we know that the fastest growing group of people taking out loans is grandparents. And that's because some of these people have been through this loan machine 4 or 5 or 6 times. It's unbelievable the amount of times that people go back and buy paper. Americans are addicted to buying paper. We cannot stop ourselves. We've just bought this cultural lie that if you do this, it'll get you a good job. And anybody who says that's not why you're sending your kids, yes it is.

Hannah Maruyama [00:04:51]:
That is the number one reason why parents send their kids to college. It's because they believe they must do that to get a good or high-paying job. That is the reason. And if that was not the case, people would not be doing it. They would not be doing it if they did not think that there was some sort of financial return. That, that is by and large why most people send their kids to college. And you really feel for this generation of parents, like this 47-year-old, because what is that, is it millennial? Kind of millennial, Gen X. It's right there in the middle, basically.

Hannah Maruyama [00:05:15]:
They're not baby boomers, but they're not necessarily full millennials either. Elder millennials, I think is what they call them. But these people are, they have their own student loans and then now they're also caring for aging parents. And then they're also being asked now to being, and now they're also being asked to pay for their children's student loans. And if you're a higher earner like that, $140,000 a year, that's pretty good. Like that's compared to the US median, you know, he's doing pretty well because the US median I think is like $67,000, $69,000 a year or something like that. So he's doing twice as well as the US median, and he's being asked to pay some for something that costs $38,000 a year on average. He's not going to get any help for it.

Hannah Maruyama [00:05:50]:
And this group of people is just getting squeezed. And really, I think that's what's bringing all of this to a screeching halt. That's what's changed public opinion, because industries can only do this to people so many times before people start to resent them for it. And that's really where academia is at. Like, they're addicted to the money, they're teaching a bunch of nonsense or just not teaching at all. And they're not teaching anything applicable, but also you can only do that for so long and then charge people so much multiple times before they start to rebel. And that's kind of where we're at, I think, culturally. And that's why too, you can even see in the current administration, they have updated these loan guidelines.

Hannah Maruyama [00:06:24]:
And I'm glad that they've done this because the new Parent PLUS loan cap, so it's $20,000 a year and then it's $65,000 total. And the official guidance was to not borrow more in student loans for their kids than they make in annual income. That's what they had to tell people. And so people are like, oh, it's not that bad. You know, you can go to college cheaply. People are not doing that though. That's not what's happening. People are spending so much money and they're not going to be able to retire.

Hannah Maruyama [00:06:50]:
And that is very scary to me personally, from an economic perspective. You've got these grads that are unemployable and no one wants to employ them. And all they have to do to crash our economy is not work. And all their parents have to do to crash our economy is again, just retire, which they now won't be able to do. but also they have to care for their aging parents who a lot of times didn't plan for retirement. It's just a disaster waiting to happen. And I don't feel like enough people are worried about that. I don't know.

Hannah Maruyama [00:07:15]:
Maybe it's just me.

Ryan Maruyama [00:07:16]:
I don't know the exact numbers, but I think just generally speaking, I think the boomers are actually pretty good. So we're talking about the parents of these parents that are making these decisions. I think the boomers are, they might be the last generation, at least for a long while, that's actually set up the best for retirement. I mean, they, They inherited a really good jobs market. They inherited a really good economy. And then they bought a lot of stuff. They bought a lot of assets. Those assets appreciated.

Ryan Maruyama [00:07:44]:
And then they're largely doing pretty okay. On the individual level, yes, if you have aging parents, you have to think about it and you have to take care of them for sure. All I'm saying is that they're much better prepared than the people that are trying to take care of them. That's all I'm saying.

Hannah Maruyama [00:08:00]:
Yes, that's true.

Ryan Maruyama [00:08:02]:
On average, on the whole, because the people that are trying to take care of them are in this job market, this current job market, they're still working.

Hannah Maruyama [00:08:12]:
And paying their loans.

Ryan Maruyama [00:08:13]:
And they're still struggling. That's all I'm saying. For me, going past all of that, I mean, if you can get past it, goes into just the fact that you feel guilted to pay for your child's degree. Degree.

Hannah Maruyama [00:08:30]:
Yeah.

Ryan Maruyama [00:08:30]:
And the fact that we've been brainwashed so much that basically good financial reason goes out the door, right? It kind of reminds me of those, what are those, like those house flippers or house hunters or something like that, whatever. It's like, oh, I'm an underwater basket weaver. I make $20,000 a year on Etsy. And my husband is a construction worker. and makes $90,000 a year. We make $111,000, $110,000 a year. Our budget is $7.7 million.

Hannah Maruyama [00:09:02]:
Very true.

Ryan Maruyama [00:09:02]:
What are we talking about?

Hannah Maruyama [00:09:03]:
I'm a professional jingle bell polisher. I make $7,000 a year and my husband is an oxygen connoisseur sommelier at—

Ryan Maruyama [00:09:13]:
That mortgage would bankrupt you. That mortgage on the first year would put you underwater.

Hannah Maruyama [00:09:19]:
Sure.

Ryan Maruyama [00:09:19]:
Reason just went, Totally out the window. And so I think without the cameras on, like, at least they have an excuse, right? The cameras are on. Maybe they, maybe, maybe the producers are just like, hey, you know, just say a bunch of things. Let's just get some views.

Hannah Maruyama [00:09:32]:
It's good clickbait.

Ryan Maruyama [00:09:33]:
Right. It's like, it's like the early 2000s or like the 2000-ish version of gaslighting, right? Like, let's gaslight these viewers and just be like, what are you guys doing with your life? Like, you guys need to spend more on your house, right? And you're like, dude, This guy can afford $7.7 million. That's crazy. His butler has a butler.

Hannah Maruyama [00:09:51]:
That's insane.

Ryan Maruyama [00:09:53]:
And so with that, financial reason went right out the door and they kind of have an excuse. And I mean, you kind of have an excuse as well. You've been brainwashed and been convinced that the only way to, you know, take care of and really like steward the most important thing in your life is to totally throw financial decision-making to the wind. And like the fact that the administration has to come in and be like, yo, if you make X, don't borrow more than X. That's crazy.

Hannah Maruyama [00:10:25]:
Right?

Ryan Maruyama [00:10:25]:
Right. Like that's a kind of a no-brainer like that. It kind of shouldn't have to be said, but the marketing is so good that you've just thrown inhibition to the wind. You've just thrown common sense to the wind and it's been like, well, this is the most valuable thing that I have in my life. And that's my child's future. And I obviously want the best for them. And obviously the only way for me to provide the best for them is for them to go and get a degree and pay for college and possibly a brand name school and a brand name education. And so therefore we have to pay for it.

Ryan Maruyama [00:11:01]:
They can't get approved for the loans themselves, or I don't want them to be burdened that debt by themselves. And so then I'm going to burden myself with it, even though logically that doesn't make sense. This is just very real. You're in the back half of your career. They haven't even started theirs. They're probably going to be fine. I mean, just don't sign a loan with them and whatever they can borrow, just let them borrow that amount. And then like, hey, figure it out, dude.

Ryan Maruyama [00:11:25]:
The earning potential is capped just due to the amount of time that you have left in your career. I mean, not that people can't change their life in a very meaningful way in a very short amount of time. That's obviously the case. But if you stay in whatever job that you're going to do, and you're just like, look, you're now in the point of your career and the point of your life that you're about risk mitigation. You're now thinking about, okay, how do I not focus so much on making the income, but rather diversifying the risk? And then therefore hopefully making my money then make money and my assets and my efforts in the past help me in the future. Like you're in that stage of life. but then now you're taking on even more debt that you can't handle. And it's just like, yeah, when are we going to get off this treadmill? And the answer is probably never.

Hannah Maruyama [00:12:10]:
You know what I've noticed about people too? Because we talk to a lot of people that are in this income bracket and most of them I feel like are planning to send their kids to state schools. But what I have noticed is a very distinct lack of planning. It's almost like they want to just be carried into it and they do not want to really think about it. A lot of parents suspect that it's not the right thing to do, But I think they are afraid of not doing it because they really don't know what else to do. And so they're just like, ah, well, you know, they're playing a sport and well, you know, we'll just figure it out. And then the kids go and then we usually end up, and I say this because we get a lot of parents who are, I'm thinking about a few conversations that I've recently had like this, where I know for a fact that they're going to be back and they're going to have to reapply to our Launch Program when they're 19 because their kids have no idea what they're doing. They're going to go burn a year at some state school that they don't, they don't need to be there. They have no idea why they're there.

Hannah Maruyama [00:13:07]:
And it's not like they're getting D1 scholarships and trying to go pro. They've got like a little bit of athletic scholarships or a little bit of merit aid or something like that. You know, a couple thousand dollars that the school checks at them just so they get them to sign these loans because the social current is just going that way. They're like, yeah, well, you know, everybody else at school is doing it. And they're like, well, I know, you know, it's, it's a little much, but we're just going to, you know, I don't know. We'll worry about it later. We'll just this. And they just kind of push it off.

Hannah Maruyama [00:13:31]:
The thing that's really terrible about that is especially for people in this income bracket, probably $100,000 to like $250,000 a year, it really does add up if you have multiple kids. And then a lot of times what happens is these kids leave school and if they do graduate, then a lot of times they have trouble getting a job. But if like half of students, if they leave within a year or so, a year or two, they just have these loans now. This happens multiple times sometimes in families as well. One kid will go, leave in a year. One kid will go, leave in 3 years. Sometimes I actually have heard, if they have a family, one kid went and he left freshman year, then the daughter went, graduated, decided to go get a master's degree. She's home, has no job.

Hannah Maruyama [00:14:09]:
You know, these parents are in this earning bracket of like $100,000 to $250,000 a year. They're really having a hard time because they get no breaks, they get no help, and they just keep getting asked to spend this money. And they don't want to look like they don't love their kids. That's really what it is, because they feel like they're going to get judged by their social circle and whatever. But honestly, at what cost? Because your social circle is going to judge you for a couple months and then everyone's immediately going to forget that that's going on. I guess you could get judged by your social circle right after high school, or you can get judged when your child's home after they did a bachelor's degree and then a flail around master's degree to try to find something respectable to do so that your neighbors wouldn't talk. And then now all your kids are back at home and they have debt and it went nowhere because they just never really knew what they were doing. And this guy in this column, he doesn't say, You know, my child's looking to go to medical school.

Hannah Maruyama [00:14:57]:
Should I, you know, am I crazy for not wanting to pay for the college? So there's not a clear reason for the debt. It's just, am I crazy for not wanting to just pay for some random degree? And it's like, no, you're not crazy for not wanting to pay for some random degree. There's very little chance that that's going to pay off because only 22% of kids who graduate, which is only half of them, only half of students are going to graduate college. And then only 22% of them are going to work in their field of study. And not all of them are going to have positive ROI on those degrees, even if they do work in their field of study. And then half of the ones that do graduate are going to be underemployed 10 years out. So no, that's not crazy at all. That's a very rational thing.

Hannah Maruyama [00:15:30]:
If you make $150,000 to $250,000 a year and you're like, uh, should I pay for this degree? Probably not. Especially if there's not a clear reason that your child needs it to live a life that they actually want.

Ryan Maruyama [00:15:40]:
Yeah. And so here's your weekly reminder from Degree Free that you don't have to sign those loan papers.

Hannah Maruyama [00:15:45]:
Totally optional, by the way.

Ryan Maruyama [00:15:47]:
You don't have to buy them that degree at all. So anyway, but I'll get off my soapbox. This does kind of move me into the second point that I wanted to talk about here, which is this gap that we're seeing in 2025 and 2026. There've been a couple of surveys that came out that talk about career readiness for those that are leaving college, from those that have graduated college to be specific, or those that are graduating college. And take it with a grain of salt, surveys, you know, who knows how accurate they are, but I think the underlying trend is at least interesting. And so just a couple of key takeaways here. This is from Washington Times 2026 and from Cengage 2025. 93% of undergrads feel prepared for future jobs.

Ryan Maruyama [00:16:37]:
Okay. So 93% of undergraduates feel prepared for future jobs. That said, only 54% of employers agree graduates are competent or graduates are prepared. Okay. And so next, 70% of employers say recent grads need moderate or significant extra training to succeed. And then oral communication was rated very important by 64% of employers, while only 34% felt grads were actually prepared To be good oral communicators. I mean, this is pretty much my life in a nutshell. Like, I remember we were looking at this right before, right before the show.

Ryan Maruyama [00:17:20]:
And, um, you actually brought this point up. I was like, yeah, that's no duh. Because this was my life experience. Like, I don't, I didn't need a survey. This is obvious because this is my life experience. I felt that exact same thing. And a lot of it was the delusion. Obviously 93%.

Ryan Maruyama [00:17:39]:
I mean, I am surprised that it's not 100%. And that means that 7% of the undergrads at least had a little bit of humility, maybe. At least they had a little bit of a reality and a little bit of a realization like, hey, look, nothing that I'm doing here really matters. And so, but 93%, I was squarely— that's not— I'm not throwing shade on any of these people. I was squarely part of the 93% that was very much just like, yo, I am just totally ready for the workforce. You don't have to teach me anything. Not you don't have to teach me anything. That's, that's erroneous.

Ryan Maruyama [00:18:10]:
But I was, I felt really ready for the workforce. I felt like, I was like, yeah, I'm ready to work. I know things. I'm like, what do you think I've been doing for the past 4 years? You know, I know tons of things. And that just couldn't have been further from the truth. And any and all of the jobs that I got, let's just even say in college, when I had my internship there, I was just like, I didn't know what was going on. And then like, I told the story before, but like, I'll just give it a 2 lines here. I'll give myself a little grace.

Ryan Maruyama [00:18:41]:
I was working full-time and I was going to school full-time. And then I had this internship like 3 days a week. That was like 3 8-hour shifts or 3 6-hour shifts. It was one of those things.

Hannah Maruyama [00:18:52]:
Okay.

Ryan Maruyama [00:18:53]:
It was like a whole day in the office though, basically. It was a paid internship. They had an opening. Literally like my desk was the opening. It might've been like a little bit of there, but like really they had an opening in this department for the exact job that I was doing at the time. I was the only intern. I walk into my boss's office, like the internship's wrapping up. I've been there for like 3 months or however long the semester is.

Ryan Maruyama [00:19:17]:
And I was like, hey, I know that— hey Steve, I just wanna talk to you real quick. Thank you for the opportunity. I know that there's an opening for this exact role and I would love to stay on. and stay in the role. And he's looking at me, he's like, do you think that's a good idea?

Hannah Maruyama [00:19:43]:
Yikes.

Ryan Maruyama [00:19:44]:
Yeah.

Hannah Maruyama [00:19:44]:
That is a great illustration of this point though. She's like, yeah, no, I could be like, I'm like a mid-tier employee here. I've been an intern for 3 months. I'm competent.

Ryan Maruyama [00:19:56]:
Needless to say, I did not get that role.

Hannah Maruyama [00:19:58]:
I for one am shocked.

Ryan Maruyama [00:20:00]:
I did not. our conversation quickly changed. I said, well, yeah, I think that that's— I mean, you need a position, you need somebody, and I'm out here already doing the job. I was working at a bank at the time. I was working in the credit sector, commercial credit sector. And then he was just like, yeah, okay. So man, you know what's really exciting is this new photovoltaic initiative that we're trying to fund over there, right across. Actually, you can see the building right across Right down there.

Ryan Maruyama [00:20:29]:
And then he's in a corner office and he's like, oh, right down there. And I got up, look, I said, okay, so. And then the rest of the conversation was about that PV initiative and trying to fund it. And then—

Hannah Maruyama [00:20:42]:
You should have taken the hint and gone and been a solar salesman.

Ryan Maruyama [00:20:46]:
Yeah, right, right.

Hannah Maruyama [00:20:47]:
He was probably trying to tell you, maybe go over there.

Ryan Maruyama [00:20:49]:
Yeah, it was a disaster. It was a disaster. And I was just like, But it proves the exact point.

Hannah Maruyama [00:20:56]:
That's the reality gap.

Ryan Maruyama [00:20:57]:
And then this literally happened in the next job. And then I got hired and then I got hired in another job pretty quickly, like in succession. It took me a long time to get those jobs after graduation. But then I landed one job that I don't really speak too much about because it was literally just a few weeks. And then I landed the one that I ended up staying in for a while. But for all 3 of those roles, I was not prepared even though I felt like I was. And the reason is, is because college is not job training. College is, I mean, barely education at this point.

Ryan Maruyama [00:21:28]:
And college does not give you skills. They do not give you the skills that you need to go out into the workforce and do whatever it is that you're doing. You would hope, like the hope at the very least is that they give you the base skill. Like the argument for going is that they give you the base skill necessary To learn the rest of the skills. So let's just say if you wanted to be an engineer, right? Like a literal rocket scientist, you're, you know, hopefully because it's so math intensive, like you would get the basics and the basis of math, physics, thermodynamics, all of that stuff. I get really out of my depth really quickly here, but like that, that's just the you would hope that, but even then you're still not really ready for whatever the job is. That's taken to the most extreme portion of it. And then, but for the majority of people like me, you know what I mean? Who just sits behind a microphone, sits in front of a microphone all day, right? Like college doesn't really prepare you for that.

Hannah Maruyama [00:22:34]:
Right?

Ryan Maruyama [00:22:34]:
Like for those people that are just like moving things around on a spreadsheet, college doesn't really prepare you for that. No, it just doesn't.

Hannah Maruyama [00:22:40]:
It is very striking that 93% of these undergrads feel like they're prepared for future work. That is pretty shocking considering that on the flip side, it's almost paradosis long. You've got almost 80% of employers saying, yeah, you guys are not ready for work. And the thing that happens to these kids in between them graduating high school and then trying to get their first entry-level role is college. So I don't see how people can avoid the fact that college is causing these grads to not be employable. I don't see how, I don't see how anyone could come to another conclusion. Like, what is it, do you think, that occurs during this time that gives them these wild expectations that they're going to make $100,000 a year, and then also that they're ready for the workforce when they have zero work experience? And then the people teaching them have never worked outside of academia, by and large. I do not understand how you go, yeah, you know what, that's— if we just charge these 18-year-olds $100,000 and the people that we hire to teach them have never worked in the market that they're going to go into, or even outside of this college campus government-subsidized bubble, I can't imagine that that would make them unemployable.

Hannah Maruyama [00:23:47]:
I can't imagine why that would happen, but that's obviously what's happening because they come out and employers are going, uh, why are you so expensive to train? Is basically what employers are saying. They're like, why are you so expensive to train? But the nice thing is that, and we'll talk about this on our episode next week, but employers are starting to make steps in the right direction, which is taking back training under, under the hood. They're taking it internal because they're getting these types of results and it's getting expensive for them. to train these grads and untrain them before they retrain them, as opposed to just taking them out of high school and then just training them, which is what a lot of people are doing instead.

Ryan Maruyama [00:24:18]:
Yeah. Well, we've talked about this at length here, but we, I know we have a lot of new listeners as well, and we haven't talked about it in a while, but the way that we got in this mess was because employers, for a lack of a better term, got lazy and they used college and the degree as a synonym or a stand-in For is this person smart and is this person capable? That was it. And so that is what, what all of this is, is based off of. One of the biggest upcoming and current debt crises in the world, in our nation right now, is all based off of employers were lazy and they didn't know how to vet people. There's legislation passed against it and all that too, which was Which is another story. They didn't know how to vet people and they used the college degree as a stand-in. And off of that assumption, we've gotten the nation into a huge amount of trouble, which is the student loan debt crisis. Nowadays, employers are finally starting to see, it's just taken 50 years to see that, hey, this is not a good measure of anybody, of anything.

Ryan Maruyama [00:25:27]:
Literally, it's not a good measure of anything. The only good measure it is, is like, Can you spend that amount of money? Can you make a purchase? Can you sit in a classroom? Can you— and it's not even sitting in the classroom anymore. It's just, can you continue to make a purchase decision? That's the only thing that it shows people nowadays. And employers are realizing that in droves. And it goes exactly to what we're going to talk about next week, like you were just talking about, and the things that we're starting to see, which is they're like, yo, this is not a good proxy. For anything anymore, at least anything that I care about in my company, anything that I want to see in my employees, anything that I want to see in driving my business forward and my business outcomes forward. And so therefore, you know what? We're just going to not do any of this. Let's get rid of all requirements, all education.

Ryan Maruyama [00:26:17]:
Once again, that's in air quotes for those listening. Requirements, college degrees, high school diploma, who cares? Get rid of it all. Come in. We'll train you because we're better at it than this piece of paper.

Hannah Maruyama [00:26:29]:
This is making me think of something I just saw, which was a Wall Street— it was one of those produced Wall Street Journal pieces where they had some economist on and he just goes, the gold watch era of employment is over. And I was like, actually, no. And of course he thinks this because he works at a college. They don't know what's going on. And so he's like, oh, it's over now. Millennial people are changing careers an average of 7 times. But that's a forced function of the way colleges have forced people to try to get more and more and more and more money and trying to jump around in order to get it. Because the economy, as it's gotten worse, the cracks have shown with academia.

Hannah Maruyama [00:27:05]:
It's academia that was always, always been failing ever since the Higher Education Act passed in 1965. Academia has been on a downward trend because it's been putting people in debt for products that they did not need to purchase in order to get good work. And the economy, as it's gone up and down, has sometimes hidden and obscured what's actually been going on. If the economy's strong, it's not as obvious that college is an unnecessary purchase because people will be able to get jobs enough that it kind of, yeah, okay, you know what, they're probably okay, it's fine. And then you have your professional license degrees that are kind of covering up what's going on with people buying things they don't need. But then when the economy goes down and everything's going badly, it becomes very obvious that it's an unnecessary purchase for people. It's forcing the companies because it is too expensive to hire these grads because too many people are buying degrees that they don't need. And it's very expensive for companies to experience that churn and to have to constantly retrain these people when they're getting subpar results.

Hannah Maruyama [00:27:58]:
Again, Ginni Roberge, the former CEO of IBM, is famous for saying that degree-free people perform the exact same as PhDs when they're given the same entry-level training. And IBM, you know, they put their money where their mouth is. They have that New Collar Apprenticeship Program that I talk about a lot because I think it's a great model for other people to see. how they're training, they're training white-collar jobs. They're just training them. And, you know, that's kind of filtered down to smaller regional businesses too, like insurance companies that all like, they'll train their own analysts and their own data scientists and stuff like that. But I think what I was going to say about the gold watch era is I think it's going to come back. A lot of the reason the gold watch era existed was because you got your employees right out of high school and then you train them and then you pay them more and you appreciate them because they just stay and they don't leave.

Hannah Maruyama [00:28:39]:
And there is a lot of value to that in a company, and especially the smaller the company is. But most companies are not that big. And so these smaller regional companies that do make up most of the jobs in our country, I think the Gold Watch era is going to come back. So now the economists are saying, oh, it's lights out for the Gold Watch era, but I think it's quite the opposite. And this is something you and I are going to talk about, but we just talked about it earlier. We think that all these micro businesses are going to have to spring up and they're going to employ not that many people. They're going to be small. It's kind of the way that it used to be where— You know, this little business down, this bakery down the street employs 3 people, 4 people.

Hannah Maruyama [00:29:13]:
You know, this, this little whatever, you know, this little metal shop employs like 10 people. That's it. You know, and that's kind of how employment works. And, and underneath that metal shop might be a software developer and a mark— and a digital marketing person. And then the guys that actually do the metalwork, who knows? But the gold watch era is gonna come back because people are gonna be able to afford to give their employees gold watches if they're not constantly churning. You can't give anybody a gold watch if they're changing careers 7 times. as a forced function of their student debt because they're trying to make more and more and more to pay off their loans. So I think that we're going to see things actually even out.

Hannah Maruyama [00:29:43]:
I'm actually pretty optimistic about the future. I think that as it becomes more and more obvious that academia has soured everybody against buying degrees, which thank God that people have finally figured this out, this was always going to happen. In a little bit of a way too, I think that lowering the student loans is not really going to have the right effect. I think that all that's going to do is keep people Colleges are just going to kind of come down to match, you know, they're going to come down to match that. It doesn't deal with the fact that people don't need to be buying those degrees, and all it's going to do is keep people buying them at an artificial rate. Again, they always— the government always messes stuff up. Like, every time they try to do something, they just make it worse. And what people needed to do was they needed to leave those caps there so people would stop buying, or they would just completely abolish the HEA and there's no government loans.

Hannah Maruyama [00:30:28]:
That's the only way that you fix this. Because did you see that— I think it was, was it, was it Berkeley or UCLA? One of those colleges were like, oh, our master's degree programs, you know, we've decided we're going to discount our master's degree programs and we're going to discount our master's degree programs to $99,000, which is conveniently $1,000 below the $100,000 cap. And it's amazing to me how people look at these institutions. They're like, they're just institutions of higher learning, they're just really out here for the greater good. They're just a public good. If you're Scott Galloway, we're a public good. You're not. You're just selling paper to people that they don't need.

Hannah Maruyama [00:31:02]:
That's not going to have positive ROI in their life. It's not going to teach them anything useful because they're learning from people that have not been successful in that arena. And then they're going to go out and they're trying to get a job. And master's degrees have a 48% negative ROI right now. It's wild to me that they're even allowed to sell this stuff. It's especially wild that they're allowed to access government funding for it. Get rid of it and you will all of a sudden see this entire system heal itself. You want to heal academia? You want the colleges to survive? Abolish the HEA.

Hannah Maruyama [00:31:26]:
That's the only way. Abolish the Higher Education Act and let the market go back down to where it's supposed to be. Let the market dictate the price where it's actually supposed to be. And ironically, that would actually make it more accessible to people. Everyone's like, oh, accessibility. No, no, no. It's inaccessible right now because you've allowed the government to get in the game and fund it. That's the reason it's inaccessible.

Ryan Maruyama [00:31:46]:
Yeah. Colleges are brutal, brutal marketers. I mean, just the best in the world. And we've talked about it. A lot. We talked about it a lot. They're amazing marketers.

Hannah Maruyama [00:31:55]:
I was just talking to Mackenzie Price on her podcast, The Future of Education Podcast, and she was saying her daughters are 18 and 20. And she said that she thinks that they've received millions of dollars worth of college marketing because of, she's like, the amount of material and things we've gotten from schools that my daughters have not even applied to and calling and they're sending and they're trying to do anything to get these kids into their schools.

Ryan Maruyama [00:32:15]:
I did want to maybe not play devil's advocate, but I did want to just possibly, I don't know, for lack of a better word, pushback, I guess, a little bit. For one, the gold watch era. One, you were saying afford gold watches. You don't really afford the gold watch. They stay there for 25 years, 40 years. It just depends on what your organization deems is worthy of a gold watch. And then you get the gold watch for that amount of service. It's not really an affordability thing.

Ryan Maruyama [00:32:49]:
That's what you said. So I just wanted to kind of not correct you, but correct you there. And so the gold watch as well. Yes, I do believe that the student loans, and I do believe that being in debt in general, or rather even more accurately said, having large monthly payments every single month is a very good forcing function to then have to go and make more money. If you look at the richest people in the world. I mean, I guess at a certain point it doesn't matter, but they all have kids, right? And it's just like, well, but it's not really debt, but they're—

Hannah Maruyama [00:33:25]:
Their costs go up.

Ryan Maruyama [00:33:27]:
Right, exactly.

Hannah Maruyama [00:33:27]:
Costs go up.

Ryan Maruyama [00:33:28]:
So they make more money and they have a stronger reason why. And so I do agree with you there. I do also think that somewhere in the past 60 years or so, our expectations as a society has gone up. And whether that, I mean, it's definitely gasoline has just been poured on the entire thing with the, with social media and just seeing how the other quote unquote, the other live and just be like, oh, I want that. You know? And like, well, you can get that. It just costs $2 million. And it's like, well, okay, I can do that. And, but the only way to do that, especially from an employment standpoint, which a lot of people are employed, majority of people are employed.

Ryan Maruyama [00:34:09]:
is by going and getting outsized raises. You don't get outsized raises by staying in one place. And so you get it by going across the street. You work for this bank, go across the street, you get a 30% raise. 5 years later, you come back and you get a 60% raise, whatever. And then you come back and that's 10 years and you see the people that have stayed there at the company, and they'd just been getting their regular 3% inflation rate raise, and you are now their boss's boss making triple what they make. I think a lot of it could possibly just be driven by the societal need for more. It kind of reminds me of— there's this movie called The Other Guys.

Ryan Maruyama [00:34:56]:
You know that I love this movie. I love this movie. It's David Ershan is like the villain or the main bad guy. And he's just like this Brit who's like, But really, or an Aussie or something that just like— no, he's a Brit. And that he just loves America and he's like, I myself have like 7 Ferraris, you know? And he's just like, everybody should just want more. And he's just giving a motivational speech about it. And I think that while funny and a movie, I think that that is largely a society. We just want more.

Hannah Maruyama [00:35:25]:
Yeah.

Ryan Maruyama [00:35:26]:
Right? Like when you go to Disneyland, it's not enough to go to Disneyland anymore. Like you want FastPasses now. Right. But granted, FastPasses weren't a thing back then, but granted that not as many people were going to Disneyland back then. Right. And so it's like, what are we doing? So a lot of it has to do with your expectations and then, you know, probably not curb your enthusiasm, but curb your expectations.

Hannah Maruyama [00:35:44]:
Wow. So this is a really fun episode. Uh, don't buy your kids college degrees and don't take them to Disney World.

Ryan Maruyama [00:35:49]:
Right, exactly.

Hannah Maruyama [00:35:50]:
Degree-free.

Ryan Maruyama [00:35:51]:
The second point that I wanted to bring up about it, but, but I largely agree with you that, that one of the biggest line items, if you look at everybody's personal finance statements, one of the biggest line items every single month would be that loan payment. And then where if you were to look a generation before, that loan payment didn't exist. And so to that point, I completely agree with you. I just wanted to be a little bit more accurate, or at least what I believe is a little bit more accurate of, hey, it's also just the widening of, you know, people's spending.

Hannah Maruyama [00:36:25]:
Yes. I did want to clarify really quick though about the gold watch era. I know that it's not the cost of the gold watch. That's not what I was talking about. I was more talking about the way in which companies are able to take better care of their employees if they're there longer. Good example of that is Dave Ramsey's company's famous for taking really good care of their employees. That said, they stay there a very long time. They don't really have a very high churn.

Hannah Maruyama [00:36:46]:
And so you get an employee that's been there 20 years and they have cancer and you're able to pay for them to be sick for 2 years and also pay for their cancer treatment. because they've been there a long time. So I'm more talking about the Gold Watch era mentality of taking care of the people that work for you because they've worked for you for a long time. That's difficult, and you're not gonna find that when you're in and outta jobs every 2 or 3 years. Like, it's expensive. It's expensive for companies, and it's also, there's not that depth of relationship and knowledge, and we're a family. You know, that's, people always say, the corporates be like, we're a family, but no. But if you do work at a company for like 20, 30 years, you do become really close to the people that you work with.

Hannah Maruyama [00:37:22]:
And the smaller the company is too, if it's a smaller regional company, Then yeah, like that's where people can really, companies and the people who work at those companies and the owners really can help and take care. And I've seen that in a small way. Like I've seen that at restaurants that I worked at. I remember that I worked at a restaurant when I was 16 in Savannah and the owners, it was a small family-owned restaurant. So the managers were like the siblings and the parents weren't always there, but they owned the restaurant. And they did, like when employee, you know, so-and-so's car went out, you know, they would. put a down payment down on a car for a single mom who had a daughter that she had to take to school. Things like that where people are valued.

Hannah Maruyama [00:37:57]:
And I'm just using that example as, you know, for a restaurant. But that is the case where if your people stay, then you do take better care of them. 'Cause also you have a longer horizon with which to do that.

Ryan Maruyama [00:38:08]:
You would hope that they take better care of you. I think that's where society has gone and that's where the employment has gone. It's kind of like a risk thing. It's risky either way. And so you're accepting the risk either way. By jumping around, what you're usually saying is that like, I don't expect anything outside of whatever it is that's in my benefits package to be provided to me. And I'm going to then outearn and I'm going to keep moving around. And then when I come back 10 years later and I'm your boss's boss and I make 3x what you make, I won't need special treatment because of the mainline benefits package that is on the paper that, that I get.

Ryan Maruyama [00:38:43]:
So like, that's the risk mitigation there. And then the risk mitigation that you're speaking about is like, oh, maybe some benevolent person will then take care of me if something happens. And it's like, okay, maybe—

Hannah Maruyama [00:38:54]:
You have to choose the type of society you wanna live in.

Ryan Maruyama [00:38:56]:
Maybe if the corporate structure allows, maybe depending on who your boss is, maybe depending on X, Y, and Z. And like, they're both depends. Both depends about this, depends about that. If this, if that, then it's just about risk, however you see it.

Hannah Maruyama [00:39:11]:
I agree. But I think that there's a lot of discussion where people want companies to be both of those things, which is they do want them to constantly be paying them 10% more a year, but they also do want them to have this long-term sort of loyalty and then benefits. And then companies and employees are constantly at each other's throats about this, but it's like, you can't have both. You really do have to decide. And it seems like nobody's able to decide. The employees can't really decide if they just want to earn really high or if they'd rather work for a company that's thoughtful and benevolent, like you said. And companies can't decide if we can afford to treat people this way. If we do, how much? And then deciding what you're able to allot in order to solve people's problems.

Hannah Maruyama [00:39:47]:
And then And what do you do? And then how much are these people worth per year? Because you can only spend so much before you're not making money. It's just a tough situation all around. But you can see how college and student debt has contributed a lot to this oppositional relationship. It's hard for me. It seems to be very obvious that that is the root cause of a lot of it.

Ryan Maruyama [00:40:08]:
So moving on, I did want to talk about those training programs that are sprouting up everywhere. It also is true, like I'm just playing devil's advocate or just pushing back a little bit. It also is true that the nature of work looks fundamentally different than it did X amount of years ago as well. And you and I have had a conversation with a CEO of a company that's in this workforce space. And he talked about the skillset being spiky. Companies are more and more moving towards having spiky individual skillsets than having well-rounded individuals. And so that's kind of the whole— a lot of people make that secondary argument of, well, you go to college to be a well-rounded person. to learn whatever and to get exposure to whatever.

Ryan Maruyama [00:40:53]:
Whatever well-rounded means to those people that make that argument. But that's what they're saying. The workforce has gone extremely away from that. And especially in the lower tiers, especially in the entry-level workforce, it's very spiky.

Hannah Maruyama [00:41:08]:
You don't really want a generalist. You can't afford a generalist because you usually need a specific task accomplished.

Ryan Maruyama [00:41:13]:
Yeah, exactly. For a task doer. That's exactly what I was going to say. For the entry-level people, you're task doers for the most part. I need you to do this task, do it really well. While you do that, you're gonna fill in the context around you of like, how does this task ladder up to value into the company? How does this feed our revenue streams? How does this save money? Why is it that I even hired you? And then with that fuller context, with that rounding out, and like the whole point of this is basically like, I think that that rounding out still happens. And it's very necessary to go up in the organization, but that rounding happens on a different layer. Now that well-roundedness comes in the job.

Ryan Maruyama [00:41:56]:
It comes through experience. It comes through going in, filling out your contacts and being like, oh, got it. This is why I'm doing this task. This is why my, my boss does this task. This is why my coworker does that task, even though we're the same person. and understanding it. And so the training programs are an obvious necessity for the well-rounded people. And once again, using a lot of air quotes in this, so for people listening, I apologize.

Ryan Maruyama [00:42:29]:
For the well-rounded people that are coming out of college and they're like, well, you're too rounded.

Hannah Maruyama [00:42:33]:
You're a beach ball.

Ryan Maruyama [00:42:34]:
Yeah. This is, I don't know what to do with you. We don't need All of that round.

Hannah Maruyama [00:42:39]:
Yeah. Like, I just need you to do a few things. And a lot of that is communication. And again, college is not teaching that.

Ryan Maruyama [00:42:45]:
Yeah. It was not even just communication, but I just need you to press this one button on this machine at, on this cadence. And then maybe, possibly, maybe not on this cadence, but then that's for you to decide. But like, yeah, but then I learned literature and I don't— this one button, I just need you to press it on this cadence. And then maybe sometimes just not on that cadence. And then maybe that's just up for you to—

Hannah Maruyama [00:43:05]:
but then I might, And so it becomes really tough for them to find entry-level roles too, because of that. And that's why the best time to do it is planning this. And again, I keep saying this, but shortening the distance between high school and your child's first strategic entry-level role so that they can start learning how to do tasks and add value and get into the industry that they are going to build a career in and get all of that entry-level stuff out of the way before they're trying to get their real job in 3 or 4 years. Again, when their peers are graduating college and not hireable.

Ryan Maruyama [00:43:37]:
Yeah, exactly. And that's pretty much it for this week, guys. Until next week, Allah.