Tennessee workers with associate degrees and long- term certificates often start at higher wages than four-year graduates, according to a new College Measures study. It takes five years for graduates with bachelor’s degrees to catch up.
“You don’t need to go to a flagship university to get a good job. There are many successful paths into the labor market,” said Mark Schneider, author of the report. “Students have the right to know before they go and know before they owe.”
The EduTrendsTN website, a joint venture of the American Institutes for Research (AIR) and the Matrix Knowledge Group, has detailed data on labor market returns in Tennessee.
At the end of the first year in the workforce, long-term certificate holders earned more than $40,000, those with associate degrees, $37,000 and those with a bachelor’s, $34,262. After five years, the median wages of bachelor’s graduates were similar to two-year graduates’ earnings ($41,888 versus $41,699), and slightly trailed certificate holders ($42,250).
“Many sub-baccalaureate credentials can be entryways to the middle class,” Schneider said.
Learning how to fix things or fix people pays off, writes Schneider on The Quick and the Ed. For associate degree graduates, electric engineering technicians earned the most ($61,000) after five years. Graduates in nursing and allied health fields also did well.
Graduates in business, liberal arts and management and information systems earned less than the state median. Human Development and Family Studies graduates earned much less.
After five years, associate degree graduates average $41,699, a few dollars more than Tennessee’s median household income.
“Five years after graduation, the 15 Tennesseans who got bachelor’s degrees in ethnic, cultural minority, or gender studies were making an average annual wage of $26,000, actually about $2,000 per year less than they were making one year after graduation,” notes Fawn Johnson on National Journal.
In a recent survey, 99 percent of parents with children in college said that college is “an important investment in one’s future.” Yet, “only about half of students, graduates, and parents of college students had engaged in an ‘in-depth’ conversation about how student loans would be managed or paid for after graduation.”
The average college graduate with a bachelor’s degree will earn $1.19 million over a lifetime, compared to $855,000 for an associate degree holder and $580,000 for a worker with only a high school degree, estimates The Hamilton Project. But the choice of a college major makes a huge difference in earnings.
Overall, more-educated people earn more. But graduates in engineering, computer science and other quantitative fields will earn a lot more than people who major in early childhood education, family sciences (home economics), theology, fine arts, social work, and elementary education.
In the lowest-paying fields, four-year graduates can expect to earn less than the average worker with an associate degree.
For the median bachelor’s graduate, cumulative lifetime earnings across majors range from just under $800,000 (early childhood education) to just over $2 million (chemical engineering).
Colleges should be rewarding for educating students, not for selecting only the best, said Andrew P. Kelly, who directs the American Enterprise Institute’s Center on Higher Education Reform, at hearings on the president’s proposed college ratings system.
Unfortunately, our ability to measure the “value-added” by a college program is almost nonexistent, and the measures that the Department of Education has proposed are woefully insufficient as an approximation of that quantity.
It is much easier for colleges to change the students that they enroll than it is to change the quality of education that they provide.
If the ratings system does not account for this, it will likely set up a scenario in which selective colleges are provided with even more resources, while open-access institutions work to become more selective in an effort to improve their outcomes
Federal ratings should not be linked to federal student aid, argued Kelly. Instead, the ratings should be designed to help prospective students evaluate different programs at different colleges.
Outcomes measures will be based on flawed graduation data, said Kelly. “We need some validation that the diplomas colleges award are worth something,” such as whether graduates earn enough to pay off their loans. In addition, those developing PIRS should include “rigorous pre- and post- measures of success, or at least identify relevant control groups to compare results.”
Smaller, more selective schools could raise their access ratings and lower their net price easily by admitting more low-income students, Kelly said. That would help a small number of students.
Large, less selective schools with low rates of student success have a tougher choice. “They can embark on the hard, uncertain work of improving teaching and learning to boost student success. Or they can take the easier route and admit fewer low-income students.”
All of this is to say that if improvement is quicker and easier for low access/high success schools than it is for high access/low success schools, then rewards will accrue to the former. That will simply reinforce their place atop the higher education system and, frankly, waste taxpayer dollars on schools that don’t need them.
Selectivity is the key to U.S. News’ prestigious “best colleges” rankings, Kelly wrote in an earlier Forbes column. “Those measures often have everything to do with who colleges admit and less to do with what colleges actually teach them while they’re there.”
Earning a vocational certificate in one year or less can raise earnings significantly, concludes a forthcoming study announced at a Center for Analysis of Postsecondary Education and Employment conference. Past research has found labor market payoffs only for longer-term certificates.
Di Xu and Madeline Trimble, researchers at the Community College Research Center, found “positive, significant returns” for short-term certificates earned at community colleges in Virginia and North Carolina, reports Inside Higher Ed.
North Carolina students earned $1,172 more per year, on average, and were 7 percent more likely to be employed. Virginians who earned a certificate earned $888 more and were 3 percent more likely to be working.
The value of certificates varies, depending on the field, said Trimble. Earning a basic law enforcement certificate at a North Carolina community college leads to a $10,000-plus raise because the certificate is “tightly tied to licensing requirements” in the state, she said.
Short-term certificates in nursing or medical assisting failed to yield almost any labor-market returns, the research found, while longer-term certificates in those fields did well. And short-term certificates in some health-care disciplines, such as in phlebotomy in North Carolina or dental assisting in Virginia, did result in substantial wage gains.
At Northern Virginia Community College (NOVA), certificates are stackable, said Bob Templin, NOVA’s president. Credits will count toward higher-level certificates and degrees.
Students who earn a 12-week certificate in an automotive technology field, such as one for an emissions specialist, are employed and earning $39,000 a year 18 months later, said Templin. But there’s little pay bump for people who earn emergency medical certificates because most students use them to become volunteer first responders for fire departments.
Associate degrees in liberal arts, humanities or general education don’t raise earnings, concludes a study by the Center for Analysis of Postsecondary Education and Employment. These degrees pay off only if they’re the first step to a bachelor’s degree.
This chart explains why college isn’t for everyone, writes Chris Matthews on Forbes. “The bottom quarter of earners with a college degree don’t make more money than the average high school graduate.”
Over the past 40 years, the cost of a degree has increased 12-fold, while graduates’ inflation-adjusted earnings have stayed the same.
It’s possible those lower-quartile workers would have earned even less without a degree, he writes. Some may have chosen fulfilling but low-paying jobs. Still, it’s sobering. And it doesn’t include the many people who dropped out before earning a degree.
Via Cost of College.
For-profit college students borrow more than community college students, but don’t earn more, concludes a Center for Analysis of Postsecondary Education and Employment (CAPSEE) working paper.
Six years after enrollment, for-profit students are more likely than community college students to have earned a certificate or associate degree.
They have lower employment rates and earnings compared to all college-going students, but those disadvantages are “linked to their prior academic record and disappear when compared to community college students.”
However, in comparison with similar community college students, for-profit students borrowed about $13,300 more for their higher education. “This borrowing most likely reflects the higher tuition at for-profit colleges, which in turn may be driven by the students’ greater access to federal student loans.”
College students don’t work very hard or learn very much, concluded Richard Arum and Josipa Roksa in their 2011 book, Academically Adrift.
How did those students do when they graduated and hit very tough job market? Not well at all, they write in Aspiring Adults Adrift.
Arum and Roksa followed 1,000 graduates for two years. “Fifty-three percent of the college graduates who were not re-enrolled full-time in school were unemployed, employed part-time, or employed in full-time jobs that paid less than $30,000 annually,” they write.
Their earlier book observed that many college students “took easy courses, regarded themselves as privileged customers, socialized heavily, and came away with little to show for their years on campus,” reports Businessweek.
Two years after college, only a little over a quarter of the students had landed jobs paying better than $40,000 a year.
Richard Arum, Josipa Roksa
Many college graduates struggle with the transition to adulthood, write Arum and Roksa in the Chronicle of Higher Education.
One quarter were living with their parents and three-quarters still were receiving financial assistance from parents.
Other measures of adulthood were lacking, such as democratic citizenship. “Two years after graduation, 36 percent of our respondents reported never reading a newspaper in print or online or doing so only once a month; 39 percent reported discussing politics at similarly low frequencies,” write Arum and Roksa.
U.S. colleges need to do a better job improving skills such as critical thinking and complex reasoning, they argue.
North Carolina is making it easier for students to predict the dollar value of college degrees, reports AP. A new state web site will provide median earnings, employment and post-degree education by major, degree and campus.
Five years after earning an associate degree in cardiovascular technology, community college graduates average $60,869. Other top-earning degrees are radiation therapy technology, fire protection technology, nuclear medicine technology and clinical trials research associate.
The median income for associate degree graduates in all subjects was $30,345 after five years. (The search function isn’t fully operational for associate degrees and doesn’t work at all for certificates.)
Nuclear engineering graduates average $89,537 a year five years after earning a bachelor’s degree. Theater graduates average $10,400.
“Of course, there are many paths to success. So this is not a recommendation, it’s just a way to arm students and families with good, useful information,” said Peter Hans, who pushed for the project when he was chairman of the University of North Carolina Board of Governors.
Anthony Carnevale, director of Georgetown University’s Center on Education and the Workforce, said North Carolina’s program, inaugurated last week, is one of the best at showing the value of a degree. He expects college instructors to hate it. “They don’t get up every day and think about getting somebody a job. They’re teaching history or something, so this is news to them,” Carnevale said.
Maine also has launched a site with earnings information by degree for community college and state university graduates.
Commonly used college quality measures, such as graduation rates and loan defaults, are inadequate and sometimes misleading, writes Ben Miller, a senior policy analyst for the New America Foundation, on EdCentral.
Completion statistics for community colleges and other two-year-or-less institutions are especially inaccurate, he writes. It’s not just that the federal data misses part-timers and transfers. Completion data also confuses success rates in short-term certificate programs with longer-term associate degrees.
. . . many certificate programs run for no more than a year. These programs thus present fewer opportunities for students to drop out. That’s why colleges that predominantly grant certificates tend to have quite high completion rates and also the reason that for-profit institutions often appear to have better graduation rates than the largely associate-degree-granting community colleges.
A low completion rate is a sign of low quality, but a high completion rate may signify a quick, easy program with very little return on students’ time and money.
Cohort default rates also can be misleading, especially for community colleges with very few borrowers, writes Miller.
For example, Gadsden State Community College in Alabama has a 20 percent default rate but that’s based on five borrowers out of an enrollment of over 8,967. This makes it impossible to draw any conclusions about a college based upon less than 0.05 percent of the college.
On the other side, a low cohort default rate might be just as much an indication of successful loan management than success. The cohort default rate only measures whether students default within a certain time window. Students who default after that period or who are extremely delinquent but never default are not counted in the rate. The usage of income-based payment plans can also distort cohort default rates, since a borrower could be earning such a low income from their program that they have to make little to no payments, making it more difficult to default.
Passage rates on licensure or certification exams, such as in nursing, do measure learning outcomes. However some programs — especially in teaching — ensure a 100 percent pass rate by denying diplomas to students who haven’t passed the exam.
President Obama’s student loan plan, which limits repayment to 10 percent of the borrower’s disposable income, closes the barn door after the horse is gone, says Anthony Carnevale, director of Georgetown’s Center on Education and the Workforce, on NPR. The fundamental question about college debt is whether students are “getting value for money,” says Carnevale.
Are we helping people cope with debts they never should have taken on in the first place?
Students and their parents don’t always think through what they’re spending for college and what they’re likely to get for it, says host Michel Martin. If students know they’ll only have to pay 10 percent of their income — with the unpaid balance forgiven in 10 to 20 years — might they be tempted to think “it’s not going to be that big of a deal?”
That’s a risk, says Carnevale. If the system isn’t linking loans to long-term earnings, it will continue to be ineffecient.
Ultimately, the taxpayer pays for that as do many of the students who find these loans still overwhelming. That is, it’s not as helpful if you’ve built the loan and it’s going to burden you for a number of years. Just have somebody help you with the burden. The real issue is ensuring that you minimize the burden in the first place by linking value — economic value — to the loan.
The loan policy will help some people, he says. More fundamentally, we need to “ensure the young people know what they’re getting into when they borrow and make sure they’re not borrowing trouble down the road.”
Stop telling 18-year-olds to follow their “passion” — and run up huge debts, writes economist Peter Morici in the Baltimore Sun.
Easy access credit has pushed up college tuition far faster than inflation generally and even health care costs. University presidents are happy to pad bureaucracies and indulge faculty who would rather undertake research than teach, if students can borrow money to pay for it all.
College primarily “is about acquiring skills that have value in the marketplace,” writes Morici.