The Kentucky Council on Postsecondary Education recently released a report tracking the economic return on higher education investment, which details about 44,000 Kentucky students from their high school graduation in 2011 to 2019.
CPE President Aaron Thompson said the evidence from this report is clear.
“Higher education pays for those who earn college credentials in Kentucky,” he said.
Central notes of the report, titled “Early Economic Return on Higher Education Investment,” by Grace Dai, are that about one-third (36.2%) of the high school class of 2011 completed a college credential by 2019. There were 60.9% of the class of 2011 who went to college in or out of state, but only one-third of them completed a postsecondary credential.
Also key in the report is that by 2019, those students who did receive a credential earned more than their high school peers who did not.
“After eight years of being in the workforce, high school graduates earned a median annual salary of $29,478,” the report said. “By comparison, in 2019, certificate/diploma holders earned $37,369, associate degree holders earned $38,268, and on-time bachelor’s degree holders earned $41,915 with fewer years of full-time work experience.”
The actuality of financial aid and cost of higher education was also represented in the report. Financial aid covered 28% to 34% of total cost of attendance for on-time graduates, with about half of the college goers in this group borrowing student loans to finance their education.
That added up to be a total loan balance of $8,595 for a certificate/diploma for what the report called the “typical borrower” and $8,309 for an associate’s degree. A four-year bachelor’s degree totaled loans amounting to $25,421 for these students.
Further, the median out-of-pocket cost for public postsecondary credentials was “much lower” than published sticker price costs of attendance.
According to the report, students paid a fraction of the total cost of attendance, with the median net cost being $21,062 for a certificate/diploma, $25,778 for an associate’s degree and $59,800 for a bachelor’s degree completed in four years.
About 44% of those students with a bachelor’s degree “were in the 75th%ile of Kentucky earners in 2019,” the report said, compared to 21.4% of high school graduates.
“Overall, economic standing improved with each successive level of education,” the report said. “Just as college graduates in the cohort were more likely to be earning at the highest income%iles, they were much less likely to be making below $20,000 a year (the bottom income percentile).”
Of the Kentucky students in the 2011 high school graduating class, 49.8% were female and 50.2% were male. There were 55.3% considered non low-income, and 44.7% low-income. White students represented 80.5% of this group, while Black students represented 9.6%, 5.6% were Latinx and 4.3% were listed as “other.” Students from rural areas represented 46% of this group, and 54% were from urban areas.
There were 15,809 college completers from this group of students, and of those 58.7% earned bachelor’s degrees; 18.3% earned an associate’s degree; 11.5% got some type of post-bachelor’s credential; and 11.2% received certificates/diplomas.
Dai, who was the lead author and researcher of the report, said the findings show the economic value of earning a postsecondary credential.
“Higher education not only contributes to students’ upward economic mobility, but it also narrows the wage gap between low-income and non-low-income students,” Dai said.
To read the full report, visit http://cpe.ky.gov/data/reports/2021roireport.pdf.
Bobbie Hayse, firstname.lastname@example.org, 270-691-7315