Monday, December 2, 2019
Chronicle of Higher Education, A New Study Calculates Return on Investment — 40 Years After Enrollment. Here’s What We Learned.:
College is expensive, and prospective students, their parents, and policy makers want to know: What kind of return can I expect on my investment?
Until now, those seeking answers have been able to evaluate the payoff of a degree as measured by official data on earnings, either one year after graduating or a decade after enrolling. A new report from the Georgetown University Center on Education and the Workforce provides an answer on an even longer scale: 40 years.
A First Try at ROI: Ranking 4,500 Colleges [press release] ranks 4,500 two- and four-year colleges that primarily offer bachelor’s or associate degrees or certificates by their return on investment 10 and 40 years after enrollment. To measure ROI, the study uses net present value, which estimates how future earnings are valued in the present. The measure, calculated using data from the College Scorecard, essentially weighs the cost of paying for college against what students could potentially earn down the line.