A recent study shows that
receiving a higher education in Wisconsin pays off for some students significantly
less than it does for others. A
high-paying job can justify the significant debt incurred from student loans,
but a low-paying job paired with loans can make college a questionable
investment.
Recent tuition increases have
made college much less affordable.
Student loan debt now exceeds 65% of average annual earnings. In the last ten years, the share of total
educational costs paid by UW students went from 38 percent to 71 percent. Tuition has risen as state tax support for
the UW system has decreased from 32 percent of system budgets to less than 20
percent since 2002.
Wisconsin college graduates face
a weak job market and high student loan debt.
In response, the Wisconsin Taxpayers Alliance recently investigated which
students will benefit from college and what degrees will lead them to
successful employment. Their findings
suggest that colleges are admitting students who are not well prepared to
succeed academically, and that some students are choosing degrees that lead to
low-paying jobs.
Low
admission standards allow academically unprepared students to struggle through
college with low chances of success. In
2011-12, 16 percent of new freshmen at four year UW campuses had graduated in
the bottom half of their high school classes.
This percentage was over 30 percent at Milwaukee, Parkside, Stout, and
Superior. A low high school class rank
does not guarantee that a student will be unable to succeed in college, but in
general, such students often gain more from alternative options.
At
University of Wisconsin—La Crosse, about 86 percent of new freshmen return for
a second year. Wisconsin universities
Madison and Eau Claire also have high retention rates. The other ten UW campuses average about an 80
percent retention rate of freshmen returning for a second year. While this is higher than the national
average, the 20 percent of students who drop out receive little or no return on
their initial college investment.
The Wisconsin Taxpayers Alliance
also suggests that students who are well positioned to succeed in college are
not necessarily well positioned to succeed in the job market. Some degrees lead to significantly higher
paying and in-demand jobs, where other degrees land graduates in low paying
jobs after struggling through a weak job market.
Students graduating with degrees
in engineering, computer science, math, health, and business have a higher
chance of finding a well-paying job. In
2011, 34 percent of UW graduates had a degree in one of these areas. 30 percent of 2011 UW graduates got degrees
in recreation, liberal arts, humanities, arts, psychology, sociology, or
education. These areas have above
average unemployment rates and below average pay rates. The average starting salary in 2010 for
graduates with an engineering degree was $55,000, whereas the starting salary
for graduates who majored in humanities, arts, social sciences, and education
averaged to less than $35,000.
About 76 percent of UW—La Crosse
students graduate in six years or less. 84
percent of UW—Madison and 73 percent of Eau Claire students graduate within six
years. A combined 66 percent of students from the
other UW system schools graduate in six years or less, and less than half of
the students at Milwaukee, Parkside, and Superior graduate within six years of
enrollment. For these students,
depending on their chosen degree, college could still be a sound
investment. For the students who do not
graduate or incur upwards of six years’
worth of student loans, college may not be worth the debt.
