By Katie Thomas, Project Associate
In today’s economy, postsecondary education is now more important than ever before, while at the same time being more expensive than ever before. However, today’s blog is not about highlighting the importance of higher educational attainment or about how it is a key contributor to an individual’s lifetime earnings and wellbeing, among various other factors. It’s also not about the increase in tuition expenses and college costs – I’ll save that for another day. It’s about the most expensive education – the one that doesn’t lead to a degree.
Of all the data that we analyze when examining a community’s workforce, the one indicator that always concerns me is the educational attainment of the population with some college, no degree. It’s a vague indicator about that portion of the population’s educational level, which leaves me frustrated and yearning for more information. Are those individuals still currently pursuing higher education? Did they attend a postsecondary institution to get training in an occupation that requires a certificate, and therefore they don’t need a degree for their career field? Or, is it that they dropped out of college?
The last question is the one that worries me the most. Not only do I fear that they may have enrolled in higher education and dropped out, I worry about what that cost them. While it’s true that individuals drop out for a variety of reasons, whether it’s a personal reason, a financial constraint, or another reason, I worry about the student loans that they may have accrued during their time attending postsecondary institutions and about those individuals possibly defaulting on them because their education did not lead to that higher paying, higher quality job that they had imagined when they first enrolled. As the costs to attend college continue to increase, the importance of ensuring that individuals are adequately prepared to succeed at the university-level and that they receive a quality education continues to grow.
This week the U.S. Department of Education released “Fact Sheet: Focusing Higher Education on Student Success.” It reported the graduation rates (percentage of students that earn a four-year degree within six years or less) and the student loan default rate by state, and also separated the data based on public; private, non-profit; and private, for-profit colleges. Among many things, the report highlighted the growing importance of ensuring that schools are providing meaningful, high-quality degrees and education.
Nationally, the graduation rate for students attending a four-year institution in 2013 was 55 percent, while the default rate was 12 percent. However, the graduation rates and default rates varied by state and by the type of institution. Here in Georgia, at private, for-profit colleges, the graduation rate was a mere 16 percent, while the default rate was nearly one-quarter of the cohort analyzed. That means that of the individuals in Georgia that attended a private, for-profit college and who entered repayment on their federal student loans in the 2010 fiscal year, 23 percent had defaulted by 2013. In Georgia overall, the graduation rate was 45 percent for public, private, and for-profit colleges combined, and they had a cohort default rate of 13 percent.
When an individual takes that step and commits to increasing their education, they should be properly prepared, as well as assured that they will be receiving a valuable education that will afford them quality, future employment opportunities. Individuals working in education and career advisement need to be aware of these issues and to properly educate and prepare individuals for their career paths and future educational endeavors. Individuals that are the first person in their family to attend college, especially, are often those that least understand the whole process of attending a postsecondary institution – loan applications, interest rates, employment opportunities for specific majors, future earning potentials, etc.
Not all degrees are equal and not all colleges provide the same quality education. Looking at the educational attainment of a community alone does not show the whole picture. Individuals on the ground in the community must try to figure out who the people are that have some college, no degree and if there is a disconnect in the information, quality, or affordability of higher education in their region. Not only will this aid those individuals in improving their prosperity and wellbeing, it will also improve the wealth of the region by having a higher quality workforce that can support future economic opportunities.