September 23, 2023

At a third of colleges and universities in the U.S., more than half of students who enrolled earn less than high school graduates 10 years later.

The new research from Georgetown University’s Center on Education and the Workforce is the latest wrinkle in the ongoing disruption of the higher education space, which has accelerated during the coronavirus pandemic and has many young people asking, “Is college worth it?”

While an average of 60% of college students earn more than a high school graduate after 10 years, the analysis finds that at 30% of all colleges, more than half of students 10 years after enrollment earn less than a high school graduate – a finding likely driven by low college graduation rates and disparities in earnings by gender and by race and ethnicity.

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“College typically pays off, but the return on investment varies by credential, program of study and institution,” says Anthony Carnevale, the director of the center. “It’s important to inform people about the risk of taking out loans but not graduating, which could leave them without the increased earnings that would help them repay those loans.”

The findings are part of a comprehensive analysis of data on 4,500 colleges and universities from the Education Department’s new College Scorecard, which includes a metric that measures the share of students at an institution whose earnings 10 years after enrollment are higher than those of workers with only a high school diploma.

The analysis showed that colleges that grant certificates or associate’s degrees have the highest return on investment 10 years after enrollment, including 25 of the 30 institutions that provide students with the best short-term net economic growth. Because these types of programs require fewer credits to complete, they tend to leave students with less debt and allow them to enter the workforce sooner – though in the long run, after about 40 years later, the returns of such programs tend to fall behind colleges and universities that offer bachelor’s degrees because the long-term earnings of students are lower.

There are exceptions, however. In some cases, the analysis found, public and private for-profit schools offer returns of more than $1 million 40 years later, exceeding the median 40-year returns of private institutions. Southern Westchester BOCES-Practical Nursing Program, for example, has 40-year returns of about $1.6 million, and the Ocean Corporation, a private for-profit institution, has 40-year returns of about $1.5 million.

The findings come as the Biden administration attempts to inject some stability into the higher education system during a moment of volatile change, plummeting enrollment and a renewed recognition by Democrats that students need options other than four-year degrees – and in particular options that provide degrees, certificates and credentials that match local workforce needs.

Among many other things, the administration is making it easier to qualify for loan forgiveness for borrowers who are working in public service and those who incurred a debilitating injury, is set on increasing the federal Pell Grant and sending hundreds of millions of dollars in additional aid to historically Black colleges and universities and overhauling regulations that govern the for-profit industry, which has drawn intense criticism for saddling borrowers with unmanageable debt that disproportionately impacts low-income students and students of color.

In a major speech last month, Education Secretary Miguel Cardona, who himself graduated from a technical high school where he specialized in the automotive programs, urged school leaders to do a better job of incorporating workforce skills into their curriculums to better prepare students for life after graduation, whether that’s by going directly into the workforce, earning a technical degree or enrolling in a four-year institution. He also called for every school to hire a counselor to advise students on their post-graduation plans.

“To elevate our education system to lead the world, we must transform education beyond high school so that it works for everybody, and so that it leads to well-paying, rewarding careers,” Cardona said. “It is unacceptable in the United States to have a postsecondary education system that further separates the haves and the have nots.”

“As we work to make colleges more affordable and accountable, we must also make them more accessible,” he said. “That means creating stronger college and career pathways between our pre-k through grade 12 systems, our two- and four-year colleges and our workforce partners so that our systems lead the world.”

Some states are already heeding the secretary’s call to action.

The University of New Hampshire, Southern New Hampshire University and NHTI, also known as Concord’s Community College, are partnering with 5,000 New Hampshire businesses to provide training programs for existing employees and new graduates who have obtained relevant micro-credential competencies, with courses as low as $50. And Colorado has long been making available a concurrent enrollment program, which allows high school students to take tuition-free, college-level courses that count toward their high school diploma and an associate degree or certificate.

“With the ongoing disruptions of the pandemic, helping students chart their post-high school path is more important than ever,” Joe Garcia, chancellor of the Colorado Community College System, says. “Concurrent enrollment is a great way for students to build momentum toward college or gain the skills necessary to enter the workforce while saving thousands of dollars in tuition costs.”

Colorado’s community colleges are the largest provider of concurrent enrollment courses and provide more than $40 million in tuition cost savings each year. They’ve awarded more than 2,600 college credentials since 2009, and a recent report from the state’s community college system shows that students who take concurrent enrollment courses are more likely to continue their education and earn higher wages within five years than their peers.

The Biden administration has also been touting the importance of the country’s community college system, where enrollment has been disproportionately impacted by the pandemic. According to the National Student Clearinghouse Research Center, enrollment in community colleges was down 13.2 percent, or 706,000 students, compared with 2019.

“We’ve seen how entire towns can be transformed when community colleges and private companies work together to train students for jobs that are desperately needed,” first lady Jill Biden, who teaches English at a community college in Virginia, said last week during a speech at the annual legislative conference for the Association of Community College Trustees, where she lamented that funding to make community college free is not part of the now piecemeal Build Back Better package the president is trying to negotiate with Congress.

Cardona is hoping that the revamped College Scorecard, from which the Center on Education and the Workforce analysis pulled its data for the new analysis, will shine a spotlight on affordable schools, like community colleges, and bring more prospective students back into the fold of higher education.

“We need a comprehensive career counseling system to help students and their families use this information to make decisions about college,” says Martin Van Der Werf, director of editorial and education policy at Georgetown’s Center on Education and the Workforce.