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Cost of a Degree

Graduate Degrees – Worth the Time and Expense?

Not a day goes by where we don’t hear about the shortage of workers with the required education and training for more than six million unfilled positions in the U.S. Early in his presidency, Barack Obama called for increasing the number of Americans earning a college degree to maintain global competitiveness in an era with increasing technology innovations, some used to replace jobs in the workforce. Despite all the attention on higher education attainment, overall enrollments have decreased since 2010, with explanations ranging from a declining birth rate and low unemployment rates to an increasing perception that degrees may not provide the same return on investment for today’s students as for Baby Boomers and their parents.

Fixing Law Schools

In a recent Chronicle of Higher Education Review, University of Tennessee law professor Benjamin Barton authored an article, The Law School Crash, subtitled “What’s worse than a decade of financial turmoil? Not learning from it.” Barton’s news isn’t new. In fact, he mentions Brian Tamanaha’s 2012 book, Failing Law Schools, as an early critique of the disparity between the cost of law school and career and salary outcomes.

New Year’s Announcement: Free Tuition For Four Years – With a Catch

Among my newsfeeds over the holidays was one from the Lexington, KY Herald Leader about an announcement from Georgetown College in Georgetown, KY about a new four-year, tuition-free scholarship for local graduating high school students. The offer applies to students admitted over the next decade and requires they live on campus all four years and pay for room and board, approximating $12,000 annually.

Which College Graduates Make the Most?

On November 20, 2019, the Department of Education released its long-awaited update to the College Scorecard, revealing median debt, earnings and other data for graduates of specific programs of the represented schools. The Wall Street Journal was given an exclusive look at the data before publication, and provides some comparisons of the data among schools and a handy tool for sorting the dataset by school, degree level and degree type to show the median debt for graduates and median income level the first year after graduating. 

Reviewing the Methodology Behind New ROI Rankings for 4,500 Colleges

 

I am no fan of the Department of Education’s College Scorecard, primarily because it is incomplete and may be misleading for some metrics. Much of the data is derived from students using Federal Student Aid (FSA) only and some of it is from those who are first-time, full-time students using FSA loans. At APUS, most of our students are part-time, working adults not using FSA to fund their education. I first wrote about the Scorecard in 2016 and reported about others like me who criticized its incomplete data.

Despite the flaws of the Scorecard, I understand why Georgetown University’s Center on Education and the Workforce recently attempted to create a return on investment (ROI) for all colleges using this data. First, it’s the only published source that uses IRS data to match earnings with students who have attended those specific institutions and who received FSA. With access to earnings, institutional costs and debt incurred, the researchers can calculate a rudimentary ROI.

A First Try at ROI: Ranking 4,500 Colleges

Anthony Carnevale, Ban Cheah, and Martin Van Der Werf of Georgetown University’s Center on Education and the Workforce issued a report ranking the ROI of all 4,500 colleges and universities listed in the College Scorecard.

Included among the researchers’ notable findings:

  • Community college and many certificate programs have the highest ROI in the short term (10 years).
  • Colleges that primarily award bachelor’s degrees have the highest ROI in the long term (40 years).
  • Public colleges have higher ROI than private colleges in the short term.
  • Degrees from private nonprofit colleges generally have a higher ROI in the long term than public universities.

The Public Higher Education Funding Conundrum

It’s no secret that state funding per student for public higher education has dropped significantly since the 2008 recession. In response to lower tax revenues during the recession, states cut their funding to higher education (a non-mandated spending item in most state budgets) and public colleges and universities responded by increasing tuition, recruiting more out of state students, eliminating faculty and staff positions, and shuttering academic programs. Many states’ tax revenues have rebounded since then, and yet their funding for higher ed has not. According to the Center on Budget and Policy Priorities, only four states out of 49 analyzed have increased their funding per student above the 2008 funding levels.

Given that state treasuries have purportedly returned to pre-2008 levels, one might assume that states would no longer be cutting higher education funding. However, that’s not the case. At least three states recently indicated the potential for change, and not necessarily positive change. The most notable was Alaska, where Governor Mike Dunleavy cut the state’s higher education funding by more than $130 million on June 28. The cut represented 41% of the state’s annual higher education budget. After the legislature failed to override his line item veto cut, the board of regents declared financial exigency. After weeks of discussion, the Regents and Governor agreed to reduce funding by a cumulative $70 million over three years. However, this occurred after the system president proposed merging the state universities under one entity, triggering a faculty vote of no confidence and a letter from the universities’ accrediting body. The Regents and the system president rescinded that recommendation, for now.

The Tipping Point in Distance Education May Be Closer Than You Think

Over my past 15 years in online higher education, most related industry research came from the Sloan Consortium (now Online Learning Consortium, or OLC). Many higher education institutions did not offer online courses earlier on and many whose experience was limited to traditional classroom instruction were skeptical of the new format. As a result, OLC surveyed provosts annually to monitor changing perceptions of online education.