Labor and Education Experts Urge Fundamental Changes to Calculating the Value of College
New Aspen Institute report on student labor market outcomes reveals national focus on selectivity and completion rates does not tell whole story
Washington, DC, April 23, 2015 – At a time when tuition costs and student debt are soaring, a new report released today by the Aspen Institute highlights the critical need for the evaluation of student employment, earnings outcomes, and likely debt to play bigger role in college decisions and investments.
Report available online at: http://www.aspeninstitute.org/publications/LaborMarketReturns
The Institute’s report, From College to Jobs: Making Sense of Labor Market Returns to Higher Education, summarizes key findings from recent research on links between higher education and the workforce. Featuring eight brief papers from leading education and workforce experts from around the country, the report cites important trends, including some that run counter to popular notions.
“There are a lot of benefits to be derived from a college degree, but research and policy are increasingly focused on one important outcome: whether students get a good job after graduating. Making sure everyone gets the most out of this research will require not only more strong studies like those reflected in the paper the Aspen Institute releases today, but the engagement of those who stand to benefit most from understanding the link between different college offerings and workplace outcomes,” said Josh Wyner, executive director of the College Excellence Program at the Aspen Institute.
Among the key findings:
- Over their entire careers, college graduates earn on average one million dollars more than high school graduates, but there is significant variation. Anthony P. Carnevale and Andrew R. Hanson of Georgetown University reported that 30 percent of people with associate’s degrees are earning more than the median income of workers with bachelor’s degrees, so that, “a teacher with a bachelor’s degree from Harvard still typically makes less than an engineer with an associate’s degree from a community college.”
- Earnings outcomes for some higher education programs suggest limited value (without further education). Of those enrolled in 4,400 career programs tied to jobs, 15 percent of students did not earn enough to cover their student loans, reported Ben Miller of New America. Meanwhile, the American Institute of Research’s Mark Schneider found many associate’s of arts degrees have limited free-standing labor market value.
- While finishing college and getting a degree is important, some dropouts may still have an edge in the labor market. Working with data from California’s community colleges, WestEd’s Kathy Booth and the University of Michigan’s Peter Bahr found that students who failed to finish certain career and technical education programs, particularly working adults seeking to update their skills, often earn as much as students who complete the program.
- The ultimate labor market value of certain degrees may be underestimated if not considered as part of a planned course of study that will include an advanced degree. A bachelor’s degree in history, for example, may seem less valuable than a bachelor’s degree in nursing, but not if the history degree is one stop along a path that culminates in a master’s of business degree.
The Institute’s report also concludes that, to really understand the labor market value of postsecondary education, particularly when many students today attend multiple institutions and obtain more than one degree before seeking employment, researchers need a way to track people as they move through college and into the job market.
“While the studies in this report offer valuable insights, they also reveal that we still really don’t have adequate data to fully measure the return on this investment,” Wyner added. “Higher education in America has several purposes, but a central one is to help us remain globally competitive and to expand social mobility. Without much better feedback from the labor market, we cannot fully understand if it is serving these critical purposes.”
From College to Jobs: Making Sense of Labor Market Returns to Higher Education contributing authors:
- Peter Riley Bahr, associate professor in the Center for the Study of Higher and Postsecondary Education at the University of Michigan’s School of Education
- Thomas Bailey, director of the Center for Analysis of Postsecondary Education and Employment headquartered at Teachers College, Columbia University
- Kathy Booth, senior research associate at WestEd; Thomas Bailey, director of the Center for Analysis of Postsecondary Education and Employment (CAPSEE)
- Anthony P. Carnevale, director of the Georgetown University Center on Education and the Workforce
- Matthew Gianneschi, chief operating officer at Colorado Mountain College
- Andrew R. Hanson, research analyst at the Georgetown University Center on Education and the Workforce
- Patrick Kelly, senior associate at the National Center for Higher Education Management Systems (NCHEMS)
- Ben Miller, senior education policy analyst at New America Foundation
- Mark Schneider, vice president and Institute fellow at American Institutes for Research and president of College Measures
- Christina Whitfield, vice chancellor for research and analysis in the Kentucky Community & Technical College System.
For more background, the Aspen Institute recommends visiting the following websites:
The research, development, and publication of this report is funded by the Bill & Melinda Gates Foundation. The findings and conclusions contained within are those of the authors and do not necessarily reflect positions or policies of the Bill & Melinda Gates Foundation.
The Aspen College Excellence Program aims to advance higher education practices, policies, and leadership that significantly improve student outcomes. Through the Aspen Prize for Community College Excellence, the New College Leadership Project, and other initiatives, the College Excellence Program works to improve colleges’ understanding and capacity to teach and graduate students, especially the growing population of low-income and minority students on American campuses. For more information, visit www.aspeninstitute.org/college-excellence.