Is now the time to improve yourself?

I'm Alayiam.
Hey, Justin, are you ready to get back in the classroom?
You bet. I mean, I'm teaching virtually, but I'm excited
to be trying out a lot of new technologies to
shake up my teaching and to make sure my students
learn a lot of economics me too.
I mean, there's definitely a lot to talk about right now.
There's demand and supply for personal protective equipment and why
that market feels like it just isn't working, and why
economists know that too few people are wearing masks. And
of course there's jobs, jobs, jobs. The labor market's the
wackiest I've ever seen. It's making the two thousand and
eight recession look downright ordinary. I'm Betsy Stevenson.
And I'm Justin Wolfus, and this is a thing like
an Economist mini episode. Betsy and I are busy finalizing
a bunch of exciting new episodes. The next one's going
to be on demand. Then we'll have an episode on supply,
and I bet you can guess that the episode after
that's going to focus on equilibrium.
For today, though, we want you to keep thinking like
an economist. We're going to use the lessons from the
first four episodes to think through whether now is a
good time to be investing in new skills, like enrolling
in formal education or getting more training.
Well, listening to this podcast, we know that.
The educational landscape has changed and that's made it hard
for people to figure out whether they should be in school.
The same lessons apply to thinking about learning any new skill.
The first step, well, it's to apply the marginal principle.
Let's do it for the question of whether we enroll
in college this fall? Should you do one more semester
of school?
And then you need to apply the cost benefit principle
and tally up the costs and benefits. Let's start with
the opportunity cost principle and ask the or what question?
What else would you do this year if you weren't
getting education or training or what.
Sadly, the opportunity cost of college has fallen. You can't
backpack ground Europe on a gap year. You might not
even be able to get a job. You could think
about work doing childcare for a family that's desperate for help,
but you know, I'm not quite sure how much you're
gonna get paid there either.
To know what you're giving up you have to think
about what else you would do, But you also need
to apply the interdependence principle. If you don't go to
school this semester, will you want to go back in
a year or two years? If so, what will you
be giving up then to go to school. The bottom
line is that your opportunity cost of education may never
be as low as it is this semester.
And ultimately, will you want that degree? How's it going
to shake your career if you don't get it.
It's clear that the marginal benefits of going to school
have fallen. I mean, my colleagues and I are working
really hard to make sure you get as much out
of it educationally, but there's definitely experiences you're going to miss.
I mean the good experiences like hanging out with friends
and learning from each other and building personal and professional
skills from all the activities you do outside of class.
I guess you probably won't miss the fact that you
won't get a chance to take an overly long, handwritten,
timed exam that makes your hand cramp up.
The really big deal here is that even though the
fund you might have on campus next year is fallen,
so is the fund that you might have just about
every other alternative use of your time. College got worse,
but so did everything else. Don't let the fact that
a lot of teaching will be remote to you. Your
alternative activities got worse too. Truth is, the best case
for going to college or for getting further education is
that everything else got even worse. The advice I'm giving
students who will ask me is that further study may
be your least bad option during a pandemic.
Which is a time of pretty bad options. All this
is linked to the labor market, which we're going to
talk about more in a future episode, but for now,
I just want to remind our listeners the recessions usually
have smaller negative impact on folks who have more education.
You can think about an education and skills as a recession.
Shock absorber.
Betty and I can't tell you what to do. You're
going to have to telling up the costs and benefits
for yourself and assess how the pandemic has affected the
opportunities in your part of the world. But remember that
while some of the benefits of education are fallen, so
is the opportunity cost.
Hopefully, at this point you're learning that if you can
think like an economist. You can make better decisions such
as whether and when to invest in more education. And
as the pandemic has turned the economy upside down, the
stakes around these decisions have never been higher.
That's why I'm so excited not just to get back
to teaching in the classroom, but to continue this podcast
and continue this journey. So to our listeners, all the
best making these important decisions for your life over the
next weeks and months, and if you're learning something along
the way.
Then make sure to subscribe, listen, and tell your friends
to think like an economist.
I'm Justin Wolfus and.
I'm Betsey Stevenson. We'll be back on September eighth to
talk to you about demand. Until then, keep practicing thinking
like an economist so you can make better decisions and
everything you do in life. To get the most out
of this show, check out our bonus episodes and supplemental
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It's time to think like an economist.