What’s That Degree Really Worth?
Published Jun 20, 2014
For its weekly blog question to education experts, the National Journal focused recently on the value of looking at employment outcomes and salaries of graduates from various degree or certificate programs. Journalist Fawn Johnson wrote about Virginia becoming the first state in the country, next month, to give the public data about whether college is worth it. Below, Institute for Higher Education Policy President Dr. Michelle Asha Cooper offers thoughts and insights about this issue to help inform the higher education debate.
Even as increasing numbers of people ask, “Is college worth it?,” studies continue to make the benefits of a college degree or credential abundantly clear—$1 million more in earnings during a lifetime compared with a high school graduate, for example. While college remains a strong, worthwhile investment, especially for low- and moderate-income families, too many of these students are not making the best choices to optimize this investment.
With average annual undergraduate student loan debt already near $25,000 and sizeable numbers of recent college graduates struggling to find jobs, it is necessary to ensure that students are armed with the appropriate data to make more informed choices about college and an academic major. So, why not lay out all the cards and give students the type of information that we know can lead to better decisions?
The vast majority of students enroll in college with the desire to complete, and they assume that the knowledge and skills gained will lead to good jobs. However, those of us familiar with the higher education system know that this path—through college and into the job market — is not that predictable. Therefore efforts that can provide students with relevant information—completion, job placement, and earnings—on the front end, are steps in the right direction, as it can lead to more satisfying outcomes—jobs and reasonable student debt—on the back end.
Last summer, the U.S. Department of Education imposed the “gainful employment” regulations on the for-profit sector. Secretary of Education Arne Duncan stated, “These new regulations will help ensure that students at these schools are getting what they pay for: Solid preparation for a good job.” Making these data available for students at for-profit colleges is a significant step toward greater transparency and accountability of the sector, as it can help current and future students assess the risk and potential labor-market value of the degree. To date, no comparable regulatory action has been taken on the non-profit sector; however, more efforts aimed at offering students better information to inform college decisions have spawned.
In the upcoming months, the state of Virginia plans to introduce a public database that allows for a more nuanced analysis of the link between job placement and earnings for specific majors at specific institutions across the state. In essence, students will be able to assess the value of a particular degree – as measured by median earnings – but will also be able to compare the value of that degree across institutions within the state.
In addition, the U.S. Department of Labor’s Wage Records Interchange System allows for data-sharing among participating states for the purpose of assessing workforce investment programs. The availability of these data, as well as those available through Virginia’s forthcoming database, has the potential to be a game changer for students and the higher education community, because up to this point it has been nearly impossible to gather reliable, post-graduate employment data for colleges and their programs.
It is my hope that these databases will not only provide students with better information, but will also be user-friendly and well-targeted tools. Otherwise, they run the risk of replicating the various online tools and databases that tout transparency, but are deeply mired in complexity themselves.
The benefits of higher education—both public and private—are real and well-documented, but those benefits are not distributed evenly as college majors and the institutions themselves are not created equal. The greatest “payoff” of higher education—to both individuals and society—only comes when students make informed and appropriate decisions about their education (See The Investment Payoff: A 50-State Analysis of the Public and Private Benefits of Higher Education and The College Payoff: Education, Opportunities, Lifetime Earnings for more on this). Offering current and prospective college students information about the labor-market value of their degree—as measured by post-college employment outcomes—will lead to more college graduates having degrees that allow them to contribute to the economic and civic health of this country.
Michelle Asha Cooper, Ph.D., is the president of the Institute for Higher Education Policy, a Washington. D.C.-based nonpartisan, nonprofit organization committed to promoting access to and success in higher education for all students.
