You don't have to do much reading these days to conclude that college costs cause deep public concern. Much of that concern focuses on how much debt students assume by graduation.
Last month, almost every major outlet covered the report from the Institute for College Access and Success showing that, nationwide, average undergraduate debt increased by 2 percent from 2013 to 2014.
The coverage was accurate, but incomplete. The reality is that some colleges, led by Franklin & Marshall, have made it an educational, strategic, and financial priority to buck the student-debt trend.
F&M has decreased its students' average debt at graduation from $33,200 in 2012 to $26,200 in 2015. That’s an improvement of 21 percent, and we expect another decrease for 2016 graduates. Three priorities have made it possible:
First, we more than doubled our budget for need-based financial aid—from $5.8 million for incoming students in 2008 to $12.3 million for new students this year.
Second, we made a commitment to meet the full demonstrated need of every student we admit.
And third, we changed our method for allocating financial aid, prioritizing larger grants and smaller loans.
Actions such as these at F&M are essential to the future of U.S. higher education, especially as most state legislatures have significantly cut funding for public institutions. Take Penn State, where student debt has risen by 4.2 percent since 2013 to an average of $36,900 per graduate with debt. Who would believe that private F&M would graduate students with $11,000 less debt on average than our own state’s public system?
Many wonder about the payoff of borrowing money for a liberal arts education. Andrea Fuller recently questioned its value in The Wall Street Journal, using salary data drawn from President Obama’s new college scorecard.
The scorecard, however, only measures the salaries of alumni 10 years after graduation—too short a trajectory since so many of our graduates earn advanced degrees and thus start their professional lives later.
When we instead look at the full arc of our graduates’ careers, the story changes profoundly. Last year, the Brookings Institution published a report on the mid-career earnings of alumni of 972 colleges and universities. F&M ranked 40th overall.
The growth rate of our graduates’ average earnings from early to mid-career is even more impressive—128 percent, compared to 82 percent for research university graduates. That’s a powerful earnings premium that shows how modest borrowing makes a lifetime impact.
With creative financial strategies, we are ensuring that college remains a catalyzing opportunity for talented students and an engine of economic competitiveness for our country. That work begins at colleges like F&M, which allocate today's resources to invest in tomorrow's leaders.
“With creative financial strategies, we are ensuring that college remains a catalyzing opportunity for talented students and an engine of economic competitiveness for our country. That work begins at colleges like F&M, which allocate today's resources to invest in tomorrow's leaders.”