The World’s Biggest Industry—General Education®

Golda Meier spoke astutely to Richard Nixon when she said, "Let us exchange generals. I will give you General Moshe Dayan, you give me General Motors." What little she knew that General Motors, General Electric and General Foods, all put together would not come close to General Education in America. At a current enrolment of 70 million students in American schools, colleges and universities, it forms the largest infrastructure. The 27.8% of the US population being educated sees education as their #1 priority spending 5.3% of the Gross National Product—over $500 billion for education. (That amounts to $100 for each and every one living today on planet earth.) Of the 70 million students, 85% are fully supported by government funding, up to grade 12, the balance in the college are mostly subsidized by government funding and the huge endowment funds that funnel about $50 billion in financial aid to students. In brief, education turns out to the largest financial activity in the USA. At 98% of literacy rate, a per capita income of $30,000+ and an economy growing leaps and bounds, one need not make any more in depth inquiry of the impact of education.

Even though US does not stand at the top of the student qualification, Americans beat the world in securing over 90% of world patents, Nobel Prizes and growth in corporate capitalization. A quick index of it can be found in the magnitude of the US stock markets. The 30 blue chip companies comprise the Dow Jones Industrial Average, which is currently hovering around 8,000. A 5-point change in the DJIA is equivalent to the entire GDP of Pakistan. On a daily basis the DJIA average swings 200 points. The total capitalization of the US companies is about $10 trillion, which is full one-third of the entire world’s capitalization. With this background, I shall return to the education industry in the USA and how can the developing world benefit from it.

A remarkable change is taking place in the world scene of higher education. Today, almost 30% of the US higher education is dominated by foreigners; about 500,000 foreign students are studying at some of the most prestigious universities in the US. The most popular subject is no longer engineering, having tapered off at 25% about two years ago. It is now business studies. Universities like Harvard and Princeton are desperately seeking foreign students to fill in the global demands of US graduates with international exposure. The likes of Citibank are now recruiting the entire classes of MBAs from Ivy League campuses but particularly those who speak another language or have had substantial exposure to foreign countries. All of this is needed as the multinational companies expand exponentially. However, the ticket to these mega jobs is neither cheap nor easy. In 1997, the starting salary of Northwestern’s Kellogg’s Business School graduate was $100,000 with $200,000 as a bonus for joining. Whereas business graduates from all schools (over 2000 in USA) are in demand it is only when you get to the top 25 universities that the bidding rises. Following are the most desired universities, in the order of preference:

1. Harvard, Princeton, Yale
2. Massachusetts Institute of Technology, Stanford
3. Cornell, Duke, University of Pennsylvania, California Institute of Technology
4. Northwestern, Brown, Columbia, Dartmouth
5. Johns Hopkins, University of Chicago
6. Emory, Washington University (St Louis)
7. Rice, Notre Dame
8. Georgetown, Vanderbilt
9. UC Berkeley, University of Virginia
10. University of North Carolina-Chapel Hill.
11. Carnegie Mellon, Tufts, UCLA, University of Michigan.

A degree from any of these institutions in any field is a ticket to freedom. For business education the top list includes: 

Northwestern
University of Pennsylvania
Harvard
University of Chicago
Princeton
Yale
Stanford 

The cost of attending these universities is about $40,000 per year including expenses. However, for US citizens, scholarships abound and anyone admitted to any of these schools does not have to pay if he or she can not. Most of these universities do not have any merit scholarships because just about the whole class is from A+ grouping; only the need-based scholarships are given. Some universities offer scholarships to foreign students also, but only to those very exceptional. You chances of getting a scholarship at Harvard are much higher tan at Tufts or UCLA because the topmost universities have very large endowment funds. Harvard for example sits on about $8 billion, Northwester $4 billion. The admissions criteria to these universities are unique. It is not just grades (which should be close to A) or the SATI score (which should be 1400+) but mostly on your extracurricular activities (class presidency, international symposia, social work, volunteer spirit, leadership, sports, writings) and impeccable recommendations from your teachers (preferably Mathematics and English). Attending a well-known school goes a long way. The process begins a year before the admission date and most applications should be in by 1 January of the year. Most universities allow you to file as their exclusive applicant (early action) program but the competition is just as tough. How tough? Well, of the 22,000 applications to Harvard (all qualified with A+ average), only 10% were accepted and those accepted, 70% chose Harvard. However, if you plan correctly, the chances of landing in any one of the 25 universities listed above are very good if you are coming from a foreign country, better than 3 to 2 versus the US students.

So, now you see what big means; the biggest industry in the world is not an industry, it is a mill—the education mill.