Study Asks, What If Postsecondary Graduation Rates Mirrored High School Completion?

March 30, 2019 by Dan McCue
A typical campus scene on the grounds of Princeton University (Photo by Dan McCue)

A recent study by Third Way, an independent and centrist think tank based in Washington, DC, focuses on the potential economic and personal benefits that would be attained if policies were enacted to push the rate of postsecondary completion up to that of high school completion.

The findings of the analysis of federal statistics on labor and educational attainment were sobering. The study showed that just 57 percent of college students complete a credential within eight years of first enrolling, much lower than the high school graduation rate of 84 percent.

Wesley Whistle, an education policy advisor at Third Way and the author of the study, estimated that increasing the secondary education completion rate to 84 percent for one class alone would result in an increase of over 730,000 two-year degree holders and over 520,000 four-year degree holders.

“Luckily this goal is even more attainable when we take into account US Census data showing 55 percent of current Americans with ‘some college’ but no degree have completed two or more years of college, and 14 percent have already completed three or more,” Whistle wrote. “This means even small efforts to increase college completion could yield massive results.”

The study notes that employers use the postsecondary degrees held by prospective employees as a proxy for hard and soft skills that translate into increased performance in the workplace. It’s not much of a leap, even in a strong economy with low unemployment, that an increase in the number of college graduates who are available would increase hiring.

According to the study, by 2020, 65 percent of all jobs will require a postsecondary credential of some kind, up from just 28 percent a few decades ago.

The Third Way examination of labor statistics found that college graduates participate in the workforce at a much higher rate than their peers without a degree.

“Since graduating more students would reduce the number of those with some college but no degree, we would see a substantial boost in the number of Americans either working or seeking employment,” the study said.

Whistle notes that in 2017, those with two-year and four-year degrees had unemployment rates at 3.2 percent and 2.5 percent respectively, while those with only a high school diploma had an unemployment rate of 4.6 percent.

Nationwide for 2017, the unemployment rate for the entire population ranged from 4.8 percent in January to 4.1 percent in December, according to the U.S. Bureau of Labor Statistics.

The study also found that holding a college degree also equates to higher wages over time as the median college graduate has significantly higher earning power than someone who only completes high school.

In 2017, the analysis found college graduates with associate’s degrees and bachelor’s degrees stood to benefit from median annual salaries of $40,322 and $53,882 respectively, compared to a median salary of $36,633 for those with “some college” but no degree.

Of course, there are spillover effects that come from increased expendable income, as those with higher incomes are able to spend more and put more money into the economy.

Higher incomes also result in more tax revenue for federal, state, and local governments. According to one analysis from The Lumina Foundation, the lifetime value of taxes for a bachelor’s degree recipient is $328,511. That is $142,231 more than students with “some college” and $191,947 more than those with high school degrees.

The Foundation said the lifetime value of taxes for an associate’s degree recipient is $201,341. That’s $15,601 more than students with “some college” and $64,777 more than those with only high school degrees.

Third Way took this analysis, applied it to the 84 percent postsecondary education completion rate it is advocating, and surmised that the lifetime increase in local, state, and federal tax revenue would be over $91 billion from a single year’s entering college class.

The study broke that down to an additional $11 billion for associate’s degree holders and $80 billion for bachelor’s degree holders.

“That’s enough money to triple the current investment in the Pell Grant program,” Whistle  wrote. “That kind of tax revenue could also build over 5,000 new elementary schools or nearly 23,000 miles of highway. Just imagine the kinds of additional local, state, and national improvements we could make with this kind of increased tax revenue year after year.”

In The News

Health

Voting

Education

FAFSA Simplification Act Delayed
Education
FAFSA Simplification Act Delayed
June 17, 2021
by Ansley Puckett

WASHINGTON - The Free Application for Federal Student Aid Simplification Act, which will implement changes to simplify the FAFSA application process, has been delayed by a year. On Friday, the Office of Federal Student Aid announced that the act will be fully implemented by the 2024-2025... Read More

Senate Looks at Biden’s 2022 Budget Request for the Department of Education
Education
Senate Looks at Biden’s 2022 Budget Request for the Department of Education
June 17, 2021
by Ansley Puckett

WASHINGTON- The Senate Appropriations subcommittee met Wednesday to examine President Biden’s Fiscal Year 2022 budget request for the Department of Education. The $102.8 billion budget for the Department’s programs and activities is a $29.8 billion increase from the 2021 fiscal year budget and includes the American... Read More

Department of Education Confirms Title IX Protects Gay and Transgender Students
Civil Rights
Department of Education Confirms Title IX Protects Gay and Transgender Students
June 16, 2021
by Ansley Puckett

WASHINGTON- The U.S. Department of Education confirmed Wednesday that Title IX protects students from discrimination based on sexual orientation and gender identity. Title IX of the Education Amendments of 1972 prohibits discrimination based on sex in any educational activity or program offered by public schools or... Read More

Loan Relief Granted to Defrauded For-Profit College Students
Education
Loan Relief Granted to Defrauded For-Profit College Students

The U.S. Education Department said Wednesday it's erasing student debt for thousands of borrowers who attended a for-profit college chain that made exaggerated claims about its graduates' success in finding jobs. The Biden administration said it is approving 18,000 loan forgiveness claims from former students of... Read More

Education Department Highlights American Rescue Plan Beneficiaries
Education
Education Department Highlights American Rescue Plan Beneficiaries
June 15, 2021
by Ansley Puckett

WASHINGTON - The U.S. Department of Education posted 28 plans Monday describing how various states intend to use the American Rescue Plan Elementary and Secondary School Emergency Relief funds to support students, schools and educators. The fund provides almost $122 billion to states to support schools... Read More

Biden Taps Sandra Bruce to Be Inspector General for Ed Dept.
Education
Biden Taps Sandra Bruce to Be Inspector General for Ed Dept.
June 15, 2021
by Ansley Puckett

WASHINGTON - President Joe Biden announced seven nominations on Friday, including his nominee for Inspector General of the Department of Education, Sandra Bruce. If confirmed, Bruce will be tasked with auditing and investigating DOE programs to combat fraud, waste and abuse. Bruce has over 30 years... Read More

News From The Well
scroll top