Debt, Dropouts and Degrees

As concerns grow about student debt and college completion, colleges and universities have been ranked in any number of ways: by sticker price, net price, cost to the taxpayer, graduation rate, default rate and more.

Now a new study is trying to combine some of those measures, taking debt loads and dropout rates into account to determine the amount of debt taken on for each degree issued.

The report, "Debt to Degree: A New Way of Measuring College Success," was released Wednesday by Education Sector. Its authors say they aim to give a more complete picture of higher education — rather than judging by graduation rates alone or by default rates alone — by dividing the total amount of money undergraduates borrow at a college by the number of degrees it awards.

"The default rate only tells part of the student debt story," said Kevin Carey, policy director of Education Sector, who conducted the study with Erin Dillon, a senior policy analyst. "We don’t believe that just because a student pays their loans back, by definition everything is fine. We’re concerned with the larger issue of greater debt burden." In fact, the ratios in the study do not take into account whether the loans are repaid.

Outside experts said the study’s premise and conclusions were interesting but flawed in some ways, in part because it doesn’t give a clear picture of individual students’ debt burdens. “Are you trying to encourage fewer students borrowing, or are you trying to encourage less borrowing by the students who do borrow?” said Art Hauptman, an independent policy analyst. Comparing a dollar figure with the number of graduates can confuse the issue, Hauptman said.

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