High Debt, Low Earnings

On Wednesday, the U.S. Department of Education released data on first-year earnings for thousands of different college programs. The data are both limited and flawed in some ways, but they are also some of the most accurate outcomes information currently available about different academic programs and majors.

Among the limitations: many programs are missing from the data set because the department chose to withhold information on those with small enrollments to safeguard students' privacy in those programs. The debt information also only illustrates federal student loan debt taken on by students themselves, not private debt and not any loans taken on by parents.

The debt and earnings information was also taken from different student samples -- debt information collected from those who graduated in 2016 and 2017 and earnings from those who completed in 2015 and 2016.

Finally, the earnings data are only for the first year after graduation. For graduates in many fields, the first year in the workforce is not entirely indicative of lifetime earnings.

Yet the new information is the best that is currently available about the relative financial value of many degrees. And programs where the median debt is significantly greater than median earnings are not hard to find.

Findings by Sector and Degree Level

A similar share of programs offered by for-profit and nonprofit institutions that were included in the data resulted in median debt greater than median first-year earnings, around 25 percent of all programs for both sectors.

At for-profits, over half of bachelor’s programs resulted in higher debt than earnings. For bachelor's degrees at nonprofit institutions, that number was only 17 percent, but rose to 71 percent for doctoral degrees.

Public institutions fared relatively well under this metric. The data show that 15 percent of associate degree programs, 9 percent of bachelor's degrees and 13 percent of master's degrees resulted in higher debt than earnings.

Professional programs, such as medical or law degrees, appear to have relatively high debt burdens. Eighty-two percent of those degrees resulted in debt greater than earnings.

However, because of the common extended pathways to earnings in those fields (such as medical residencies), that may not be cause for concern for all programs.

“Oftentimes, the heaviest debt produces the highest earnings,” said Anthony Carnevale, director of the Georgetown University Center on Education and the Workforce, referring to medical and dentistry programs.

Perhaps more troubling among the findings about graduate degrees, about 27 percent of master’s degree programs resulted in higher debt than earnings. Some graduates of master's degree programs continue their studies in doctoral programs, delaying their earnings. But other master's degrees are terminal credentials.

Ben Miller, vice president of postsecondary education at the Center for American Progress, said the data should make some graduate schools take a long look in the mirror.

“There are a lot of programs at the graduate level where you have to wonder how a school could in good conscience hand out the debt they’re handing out to people,” he said, pointing to a master’s degree in social work from the University of Southern California that he said was “immorally priced.” The program's debt levels drew criticism when the feds released those data earlier this year. Median earnings for the USC master's in social work were about $50,000, but median debt reached over $115,000.

Michael Itzkowitz, a senior fellow of higher education at the think tank Third Way, said certificate programs showed some of the most troubling earnings results. “The average high school graduate makes around $28,000 a year,” he said. “Most certificate programs show students earning less than that.”

Findings by Institution and Field of Study

Colleges that offered several of the bachelor’s programs where debt exceeds earnings by the greatest magnitude included campuses of the now-defunct Everest College, along with Remington College and Stevens-Henager College. Remington and Stevens-Henager did not respond to requests for comment.

Among public university bachelor's programs, the communications bachelor's degree at Grambling State University and the social work bachelor's at Mississippi Valley State University, both historically black colleges, took worst honors, with debt outweighing earnings by over $20,000 in both programs. Neither university responded to a request for comment.

On the opposite end of the spectrum -- public and nonprofit bachelor’s programs where earnings exceeded debt by the greatest magnitude -- the list contains many computer science and engineering programs at highly selective institutions, such as Brown University, Carnegie Mellon University and the University of Pennsylvania.

However, many nursing or health programs at smaller public or less selective nonprofit private institutions also rise to the top of that category. The bachelor’s program in nursing at Sonoma State University, for example, features a median debt of $12,500 and $110,300 in earnings.

“Sonoma State University provides an affordable, high-quality education that successfully prepares nurses to enter the workforce as a new graduate,” Mary Ellen Wilkosz, department chair of the university's nursing school, said via email.

Other health-related programs at the University of Louisiana, Monroe; the City University of New York City College; two other California State University campuses; and Creighton University also score highly.

Robert Kelchen, professor of higher education at Seton Hall University, dived into some of the data in a blog post.

“Fields like nursing, a lot [of] the health science fields, and also teaching, are fields where full-time employment rates are good but you also jump in at a relatively high salary relative to what you get later in life,” he said in an interview.

Kelchen found that at the bachelor’s level, degrees in psychology, fine arts, drama and English resulted in some of the lowest initial earnings.

“These are fields where people tend to do better later on in life,” he said. “Starting out, salaries aren’t that great.”

Also among the lowest fields for first-year earnings was biology, which Carnevale said is supported by other data.

“Biology is the lowest-earning STEM degree and it’s the most female, which is no coincidence,” he said. “Biology is overloaded with students who don’t get anything beyond their bachelor's.”

At the associate level, Kelchen's analysis found that the lowest-earning fields included criminal justice, health administration and teacher education.

At the graduate level, educational administration broke the top five in earnings, mostly, Kelchen said, because school superintendents tend to do quite well. Lowest-earning graduate fields included music, student counseling and social work.

In addition to helping a prospective student choose a field of study, the data could in theory help a student with an already chosen field of study pick between particular programs. For example, if you’d like to get your bachelor's in fine and studio arts, the best university (by one metric) might by California Polytechnic State University, where the median debt is $15,000 and median earnings are $41,000. Earnings exceed debt in the program by the highest magnitude among the data set's bachelor’s-level programs.

If you’d like to study drama, the University of Nevada, Las Vegas, had the most favorable difference between debt and earnings.

But both of these colleges are public and could be more difficult and more expensive to attend for out-of-state students. And prospective undergraduate students, if they do choose to slice and dice the numbers, typically give more weight to location and cost, many experts have said.

“Whatever’s right or wrong with the data,” said Carnevale, “it’s here to stay.”