Friday, June 3, 2016

The Missing Piece in the Debate Over College Costs

The Atlantic
By Emily DeRuy
June 2, 2016

Hundreds of colleges are offering programs that simply aren’t worth the expense. And while it’s difficult for families to figure out which schools are a good deal, a new report from Third Way suggests the reality is: depressingly few.

“Cost really only matters if students know what they’re buying,” said Tamara Hiler, an education-policy advisor at the bipartisan think tank and the lead author of the report. While much of the debate surrounding higher education has focused on rising tuition costs and student-debt loads, less attention has been devoted to what students get for the money they—and taxpayers—shell out to attend. And although criticism has been heaped on for-profit schools such as the now-shuttered Corinthian Colleges for preying on vulnerable students, many traditional non-profit schools appear to be doing the same.

To get at the value piece, Hiler and her colleagues studied how full-time students with federal loans at the nation’s 1,000-plus four-year, private, nonprofit colleges are faring using data from the U.S. Education Department’s College Scorecard, a database that allows students to compare the return on investment of various schools. They calculated that at the average institution, almost half of students who enroll and have to take out loans won’t earn a degree within six years. At the average school, just 63 percent of students who earned a degree but had to take out federal loans to get it earned more than $25,000—roughly what someone with a high-school diploma is likely to earn—six years after graduation. Students who drop out often earn much less.

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