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Thirty percent of colleges are not worth the cost, researchers conclude

UPDATED

Students would be better off not going to certain colleges

A new report from Georgetown University researchers concluded that while most colleges have a positive return on investment after 10 years, some do not.

The Manhattan School of Music, Beacon College and Berklee College of Music, for example, still have a negative Net Present Value after more than 10 years post-graduation, according to the Center on Education and the Workforce.

This means that someone who enrolls now at one of those schools would expect to come out financially worse off after 10 years.

The College Fix reached out to the Manhattan School of Music and Beacon College’s media team for comment. The Fix asked how people should evaluate college before deciding to go there based on the results of this report but neither media team responded to two emails sent in the past two weeks.

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The problem is not isolated to a handful of colleges.

At 1,233 of 4,500 institutions researched, over 50 percent of alumni will earn less than high school graduates, according to a February 22 news release from the education research center. It is partially funded with money from the Bill and Melinda Gates Foundation and is led by Professor Anthony Carnevale.

Health and medical science schools rank highest with the best return on investment.

The researchers told The College Fix via email that its research does not lead to the conclusion that a college degree is not necessary.

“Our new ROI research does not suggest that a college degree is not necessary because a majority of students at some colleges earn less than someone with a high school diploma,” Georgetown’s research team told The Fix through a media representative.

“In general, it is far more likely that a college-educated worker will have greater earnings than a high school-educated worker,” the research team told The Fix.

Georgetown’s research team shared a 2021 report and news release with The Fix that reported “[b]achelor’s degree holders earn a median of $2.8 million during their career, 75% more than if they had only a high school diploma.”

“The path to higher earnings is not solely through a four-year degree,” the researchers said.

Return on investment is just one measure of value, research team says

ROI rankings should only be used “as an approximation of expected returns from the institution” when potential students evaluate going to a specific college or university, she said.

“On average, 10 years after enrollment, the ROI is higher for institutions granting certificates and associate’s degrees based on the net present value calculations,” Georgetown’s research team told The Fix.

Public colleges also have a higher ROI than private colleges due to lower levels of debt.

“At the 40-year horizon, four-year public institutions lead to higher returns ($1.03 million) than four-year private nonprofit institutions ($984,000),” the news release with the 2022 report stated. “Public institutions primarily granting associate’s degrees have a long-term return of $856,000 while the return at private nonprofit institutions at the same degree level is $780,000.”

Still, many private institutions are found in the top 10 with the best long-term net economic gain, including the University of Pennsylvania and Bentley University. Each university must be evaluated individually, Georgetown’s team told The Fix.

“The ROI is higher for public institutions as a group, on average,” Georgetown’s research team told The Fix. “However, when it comes down to individual colleges and universities, some private colleges do better than some public ones.”

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Editor’s note: The article has been updated to include a missing “not” in this sentence — “The researchers told The College Fix via email that its research does not lead to the conclusion that a college degree is not necessary.” The attribution for some quotes has also been clarified. It’s also been updated to clarify that 30 percent of colleges surveyed have at least half a graduating class that is expected to earn less than someone with a high school diploma.

IMAGE: Diploma Ekrulila / Pexels

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About the Author
College Fix contributor Rachel Lalgie is a student at the University of Florida, studying accounting and economics. She is a member of UF's Phi Eta Sigma and the National Society of Collegiate Scholars.