By Steven Roy Goodman and Margaret J. King
January 26, 2006 — Thirty-five percent of college students in Pennsylvania – or 229,000 young people – dropped out of college in the 2004-2005 academic year. This might seem OK compared to the national rate. (About 54 percent of U.S. students entering college have a degree six years later, so one could call this a dropout “rate” of 46 percent.) But the unrealized potential of a quarter million students affects us all.
The time has come to pressure universities to lower these dropout numbers. We should ask for a nonperformance refund from the higher-education sector – like the lemon law that enables buyers of defective cars to get their money back. Universities that fail to improve dropout rates could be asked to return to the Pennsylvania treasury 5 percent to 10 percent of their annual appropriations.
According to an article in a March 2002 issue of U.S. News and World Report, the six-year noncompletion rate at Drexel University was 44 percent. At the University of Pittsburgh, it was 40 percent, and at Temple University, 56 percent. Such high rates are preventing universities from benefiting our society as they could – or should, given the enormous tax breaks they enjoy. Most universities enjoy at least some subsidies through direct appropriations and nonprofit tax status, yet they are not fully educating or training a large proportion of our next generation.
Students who leave college without a degree often carry sizable debt, along with frustration and an uncertain future. Their families lose effort and money. When students spend more on tuition (and spend, moreover, a longer period of time), parents forgo fixing up houses, buying new appliances, and having dinners out – things that benefit the Pennsylvania economy. And society faces an untrained workforce and reduced productivity.
Do universities knowingly recruit students unlikely to graduate? We hope not. Such a practice might be good for universities’ bottom lines, but it is cruel to the students involved. At all but the most selective universities, admissions officers are paid to target and enroll set numbers of students. There is therefore little institutional incentive for recruiters to guide applicants to colleges that might be a better match.
Given the sheer size of tuition revenue involved, colleges seem unlikely to change – unless the government demands more accountability. The 262 colleges and universities in Pennsylvania collect more than $4 billion in tuition each year. Pennsylvania spent more than $402 million on student aid for the 2004-2005 academic year, not including the $2 billion institutional subsidy for higher-education operating expenses.
Meanwhile, the financial burden falls disproportionately on middle-class families, who on average spend 35 percent of their annual earnings on tuition payments. Yes, colleges offer financial aid, but private student loans were the fastest-growing form of student aid last year. If a degree is only a 50 percent likelihood, such family sacrifice is hard to justify.
Concerned about costs, and craving accurate third-party college appraisals, applicants turn to those who candidly evaluate educational institutions and help families compare colleges – including graduation rates. Families need this unbiased data, but college counselors cannot reach every student in every part of Pennsylvania.
If a consumer good, expensive or not, failed to work 35 percent of the time, we would take it back to the store. It is time for a total management plan for education with a tolerable defects number – it can’t be half or even a third. As a society, we should encourage colleges to recruit those with reasonable chances of succeeding and to insist that colleges design curricula with a four-year graduation time frame in mind.
As an interim measure, perhaps legislators could require universities to disclose to all applicants the four-, five-, and six-year graduation rates for entering students in the previous decade. Families would then be able to assess realistically the probability that their son or daughter would graduate from that college in a timely fashion.