Published in the Allentown Morning Call and the Lehighton Times News, June 2008
One of the most peculiar things about teaching is when students ask, “What is something good I can do with my life?”
For those students in need of a compass, I advise you to use simple economic principles as your guide:
· Supply & Demand: The most basic principle of economics revolves around this term. Job markets that are in huge demand – health services, mathematics, accounting, engineering, scientific research, etc. – all pay well because there aren’t enough people to supply the markets.
· Trades make every one better off: Too many high school students enroll in college because it seems like a good idea. However, some people should not be sitting in more classes – and accruing an average debt of $22,000 – when they could be learning a trade or pursuing a quick, hands-on degree such as dental hygienist.
· Elasticity: People who are flexible tend to roll with the market well. If you decide to pursue a college degree, make yourself well-rounded. A friend of mine recently graduated with degrees in both special and elementary education. That doesn’t just double his chances of getting a job, it quadruples them.
· Maximize resources: Prior to the 1990s, as butchers spilt up parts of the chicken they tossed the chicken wings. But with a little entrepreneurialism, that same chicken wing that was once garbage quickly became valuable. The world around us is in desperate need of people who can turn ordinary resources into extraordinary investments.
· There is no such thing as a free lunch: If you think you’re in for an easy way to make money – many often point to law on this one – you couldn’t be more wrong. The LSAT is the most difficult standardized test in the world, and the three years you might spend in law school will be the most intense you will ever experience.
· Risk & rewards: If you’re planning on making millions, you’re going to put yourself out there in the face of failure. Under Armour founder Kevin Plank maxed out every credit card he had to make his water-wicking material, but was rewarded big because he risked big. More young Americans need to make big – and intelligent – risks. Imagine if you’re the entrepreneur to replace oil.
· All choices involve opportunity costs: If you invest $2,000 annually into a mutual loan with 10% returns for 20 years, you’ll be a millionaire by the time you retire. Think about that the next time you ask for the sticker price on a Mustang.
· Pay attention to the bottom line: Sure, you need to find a career that will make you happy, but you don’t want to be living paycheck-to-paycheck. Look for jobs that pay well, and pursue at least one of them.
Class of 2008, I wish you much success. May the torch of simple economics be your guide to unearthing it.
