When students assess the value of a college degree, they weigh the costs against the impact on their future. That impact may be social, psychological, financial, or a combination of all three. But just how savvy are college applicants in making these calculations? How consciously do students connect the choices they make in college to their personal development and professional future?
It’s reasonable to assume that students in majors with relatively clear career paths, such as social work or chemical engineering, may have more awareness of likely job outcomes and future earnings than others whose employment trajectories aren’t so predetermined. But research about students’ college decision-making is limited. More student preference studies could help clarify what students want from higher education and how well they understand the choices they make as college applicants and undergraduates.
A survey conducted by UCLA did find one motivation that united 85% of students across all student groups—they cited job outcomes as their primary reason for attending college. And in a 2015 New America poll, 85% of students surveyed ranked “to learn more about a favorite topic or area of interest” as either “important” or “very important” in their decision to pursue higher education. From that study, one clear distinction emerged between traditional college-age students and adult learners: Younger students especially hope to learn more about the world and meet new people, and many hope to cultivate independence while living away from home for the first time. Adult learners, by comparison, tend to seek out a college education to change careers and increase their earnings, or to set an example for their children.
For learners focused on career outcomes and income, it’s clear that higher education enables economic mobility. According to a study by the Center on Education and the Workforce at Georgetown University, full-time workers with bachelor’s degrees earn, on average, 84% more than workers with only high school diplomas over the course of their lifetimes. A 2008 study by the Brookings Institution found that people born into the lowest income quintile who obtain a college degree have an 84% chance of moving into a higher quintile as adults, while their peers without college degrees have only a 55% chance of moving up.
Yet, as powerful an instrument as a diploma may be for social mobility, some prospective students weigh the benefits of college against the burden of student loan debt and decide that higher education simply isn’t worth it. Students who have to take out loans to pay for college worry that, even with a degree, they won’t be able to repay their debt. Beyond colleges’ acceptance and graduation rates, these students may also want to know how a degree can open up professional and earning opportunities after graduation.
Income share agreements (ISAs), which provide students with funding for educational pursuits in exchange for a fixed percentage of their post-graduation income for a defined period of time, help link students’ professional outcomes to their schools’ financial success. Students with ISAs who earn below a minimum income threshold after graduation can defer payment until their financial situation improves, meaning ISAs insulate participants from some of the risks of unemployment.
In economic downturns, people have historically turned to higher education to improve their employment prospects. Today, however, the pandemic has put affordable college even farther out of reach for many students, and some are questioning the value of higher education more than ever. Compounding this skepticism from students, lost revenue has cut into colleges’ budgets, hindering their ability to provide all the financial aid students need. Innovative financing options such as ISAs align colleges’ goals with those of their students, directly linking the cost of college to career outcomes. For the majority of students who prioritize job placement after college, schools may set themselves apart by taking accountability for outcomes and embracing their role as engines of social mobility.