Running head: COLLEGE EDUCATED 1

College Educated: A Return on Investment Analysis

Blaze Kissell

Miami University

EDL 660C
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In recent years, many discussions have been held about whether going to

college is really worth it. When considering if attending post-secondary education is

beneficial long-term, the answer may depend on the type of institution a person attends.

These different types to consider include public, private, 2-year, 4-year, residential,

commuter, online, traditional, public-ivy, and ivy league. This is not to say that there is

one "right" combination or choice for every student. Instead, students should consider

various factors related to these institutions which will determine their ability to be

academically, socially, and financially successful throughout and beyond their time at an

institution.

These aforementioned conversations about the worth of college have brought up

several additional questions about colleges as a whole. These questions include who

colleges aim to serve, the importance of persistence and retention rates of colleges, and

the projected economic return on the investment of advanced education. Throughout

the rest of this essay, I will explain why continued education after high school in today's

21st century and technological advanced era, is still worth the investment.

Historical Background: Who do colleges serve?

In thinking about who colleges are built to serve in the 21st century, we must also

consider who these institutions were initially built for. Colleges were initially built as elite

institutions who served wealthy White men. Still today, through conscious and

unconscious bias, college admissions still present an advantage favoring wealthy White

male students (Micceri, 2009). While this is the historical background, we know that

these aren't the same demographic of students who are applying to colleges and

universities. The shift first began as a result of the G.I. Bill which financially opened up
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access to colleges for less wealthy White men who had served in WWII and were

struggling to find jobs (Selingo, 2013). While some White women had the ability to

attend colleges, there were still very few opportunities and many of these were very

reflective of the times. These institutions were segregated and primarily focused on

domestic activities such as cooking and sewing. This began to change with the

Women's Suffrage Movement in the 1930's. It wasn't until thirty years later, that the Civil

Rights Movement and Civil Rights Act of 1964 began to desegregate school on the

basis of race and ethnicity. Following this, more students of color began to gain access

to college and university degrees.

Since the shifts seen in the student demographics starting in the 30's and 60's,

we know that between 1980 and 2011 the rates of college enrollment have over

doubled. This shift was most significantly impacted by the number of non-white students

who began attending colleges and universities (U.S. Department of Commerce, 2019).

However, we also know that there are some statistically disproportionate 6-year

graduation rates for students based on their race/ethnicity (U.S. Department of

Education, 2017). This begs the question, is college still a worthwhile investment for

these students as well? Despite the difference in the rate of degree attainment my

response to this question remains dependent on variable factors, but heavily leaning

towards yes.

Return on Investment: Individual

How can someone tell if college will be worthwhile long-term and what are some of

the variable factors I have been hinting at? As I hinted at previously, some of this is

related to the type of institution a student attends (public/private, 2-year/4-year,

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residential/commuter/online, ivy league/traditional, etc.). While these choices matter,

they are not the end-all be-all to decide whether or not college is a wise investment.

Instead, students should consider four factors when making their choice.

1. How much will the degree cost depending on the institution attended?

2. Are there supports in place which will provide a legitimate and likely path to

graduating with a degree?

3. What is the projected job availability for your specific fields of interest?

4. What is your fall back plan in case you are unable to graduate?

Unemployment Statistics

I made this list to consider the pay distribution and unemployment disparities

between individuals who have some high school experience, completed high school,

some college experience, completed a 2-year degree, completed a 4-year degree, and

have attained advanced degrees beyond their Bachelor's. As we can see today,

especially heightened by the unprecedented economic crisis initiated by a pandemic,

the unemployment rate for individuals with a high school diploma is vastly higher at

8.9% compared to those with some college experience (6.8%), an associate degree

(5.9%), or bachelor’s degree (4.6%). While the unemployment percentages have nearly

doubled due to the pandemic, the difference in ratio for unemployment based on

education was fairly similar prior. This data, in addition to unemployment rates during

the Great Recession in 2008, indicate that those who are most negatively financially

impacted by national crises are those with lower educational attainment (U.S. Bureau of

Labor Statistics, 2020).

Median Salary Statistics

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In addition to unemployment data, we also know median annual salary based on

educational attainment. The median salary for those with a high school diploma is

$38,792 compared to those with some college experience ($43,316), an associate

degree ($46,124), and a bachelor’s degree ($64,896). As we can see from the salary

data which is provided by the U.S. Bureau of Labor Statistics (2020), there are stark

differences between having a high school diploma and spending at least some time in

college. Even greater yet are the financial differences between all three statistics when

compared to obtaining a bachelor’s degree.

Considerations for Race/Ethnicity

When reflecting on the presented unemployment data and average salaries

based on educational attainment, this is why it is important for students to consider how

much they will be spending on their college education, and what the projected job

market looks like for their respective fields. As previously mentioned, historically

colleges were meant to serve wealthy White students. So, how do the statistics

presented compare when accounting for race/ethnicity in regard to unemployment and

annual salary? Is college still a worthy investment for students of color when these

institutions weren't initially built to serve these students?

Data from The National Center for Educational Statistics (2019) suggests that

educational attainment is actually more crucial for some students of color compared to

their White peers. More specifically, Black and Native Indian/Alaska Native individuals

who complete high school have disproportionately higher rates of unemployment (10%

and 15% respectively) compared to White individuals with the same education level

(5%). This disparity in unemployment decreases, yet still remains disproportionate with
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the attainment of a bachelor’s degree (Black 4%, Native Indian/Alaska Native 4%, and

White 2%). Overall, these statistics demonstrate the massive financial implications

education attainment can have on any individual’s financial well-being. At the end of the

day, assuming a student's college debt is less than the annual projected difference in

salary, spending even a small amount of time and money in college is a worthwhile

investment.

Persistence and Retention Rates: Why are they important?

Persistence and retention, what do these two terms mean? How are these terms

different? Why do either of them matter? When universities discuss retention rates, they

are discussing students who stay enrolled at the university from their first year to their

second year. Retention research is important because with it, colleges have been able

to determine that most students leave within their first year because of either financial

pressures, academic disqualifications, or poor social fit within the institution

(Bustamante, 2019). In knowing this information, institutions can better focus on

initiatives and resources to help students in these areas. Alternatively, persistence

refers to the remaining years a student spends in college and the university's efforts to

ensure a student has the support they need to successfully graduate within 4-6 years of

enrolling. This is important because it speaks to the goals and mission of the institution

and directly aligns with the goals of a typical college student.

For retention, many institutions are intentionally structured such that first year

students are encouraged or required to engage with student services available at the

institution. Such services may include summer programs including, freshman seminars,

and first-year learning communities. This proactive approach has assisted many
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universities in decreasing unaddressed student concerns which often lead to departure

from the institution. This approach engages students early, rather than placing the

responsibility entirely onto the students to seek out beneficial support services on their

own (Tinto, 2012). When it comes to persistence Tinto also constructed an integration

model which explains four factors related to persistence. These factors include pre-entry

characteristics of students, the institutional characteristics, the academic integration of

students, and their social integration with the institution.

As we saw in the data related to unemployment and salary, being able to

successfully graduate with a bachelor’s degree has better outcomes than only spending

some time in college. Thus, the return on investment of college is increased when a

degree is actually attained by the student. So, looking at a college or university's

retention and 4-6-year graduate rates can be critical in relation to a student's projected

return on investment. Fortunately for most students, successful colleges and

universities continue to construct and re-assess strategic plans to increase student

retention and persistence rates using models and theories constructed by educational

scholars such as Tinto. Institutions also track trends within their own student data to

seek out desired rates given any changes that have been implemented.

Return on Investment: Public Good

For the final segment of this essay, I will be discussing how attending college is

not only a wise investment for individuals and their families, but also for the public in

general. This perception regarding the importance of attending college is largely

dependent on the values of the individual attending college. Higher education serves to

develop research to improve society, train leaders for public service, train citizens to
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serve democracy, increase economic development, and critique public policy (Kezar,

Chambers, & Burkhardt, 2015). As more people begin to understand the value of these

contributions to the public good, the more validation higher education maintains. With

more people seeking out educational opportunities through colleges and universities,

this demonstrates the continued importance of education. With an increased population

invested in higher education, either for themselves, their families, or as a public good,

the government would likely provide more financial and legislative support for

educational institutions. This cycle would continue such that by investing interest in

higher education for yourself, your family, or as a public good, higher educational

institutions are able to better serve individuals and society as a whole.

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References

Bustamante, J. (2019). College Dropout Rates. Educationdata.org.

Kezar, A., Chambers, A. C., & Burkhardt, J. C. (Eds.). (2015). Higher education for the

public good: Emerging voices from a national movement. John Wiley & Sons.

Micceri, T. (2009). How We Justify and Perpetuate the Wealthy, White, Male Academic

Status Quo through the Use of Biased Admissions Requirements.

Online Submission.

National Center for Educational Statistics, (2019). Indicator 28: Unemployment.

Unemployment rates of persons 25 to 64 years old, by race/ethnicity and

educational attainment: 2016

Selingo, J. J. (2013). College (un)bound: the future of higher education and what it

means for students. Boston: New Harvest, Houghton Mifflin Harcourt.

Tinto, V. (2012). Completing College: Rethinking Institutional Action. Chicago:

University of Chicago Press.

U.S. Bureau of Labor Statistics, (2020). Learn more, earn more: Education leads to

higher wages, lower unemployment. Office of Occupational Statistics and

Employment Projections.

U.S. Bureau of Labor Statistics, (2020). Unemployment rate by educational attainment

and age, monthly, not seasonally adjusted: 25 years and over. FRED Economic

Data.

U.S. Department of Commerce, (2019). Census Bureau, Current Population Survey:

October Supplement, 2000, 2010, and 2018. Digest of Education Statistics 2019

U.S. Department of Education, (2017). National Center for Education Statistics,

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Integrated Postsecondary Education Data System: Winter 2016–17, Graduation

Rates component. Digest of Education Statistics 2017