What Free Won’t Fix: Too Many Public Colleges are Dropout Factories

Tamara Hiler and Lanae Erickson Hatalsky:

Public colleges and universities play an essential role in unlocking the doors of higher education for many Americans. Today, more than 6.8 million students attend four-year public institutions, making up nearly two-thirds of the entire bachelor’s degree-seeking population in the United States.1 Close to two-thirds of all students attending these schools take out student loans in order to finance their education, with the average loan-holding student finding themselves more than $20,000 in debt four years later.2 And American taxpayers spend more than $10 billion dollars a year on federal Pell grants to help more than 2.7 million low- and moderate-income students attending these institutions afford a postsecondary education.3

This investment is one most Americans are willing to make—in part because of the irrefutable economic benefits gained in our modern economy by those who earn a college degree.4 But our analysis of the Department of Education’s College Scorecard data reveals that not all four-year public schools are giving students, or taxpayers, a good return on their investment. In fact, at many of these institutions, first-time, full-time students are not graduating, a large number are unable to earn wages higher than the typical high school graduate, and many cannot pay back the loans they’ve taken out.

While rising costs continue to drive the conversation around higher education in our country, this report and our previous analysis of four-year private, non-profit colleges raise much more fundamental questions beyond sticker price. With outcomes like these, it is clear that simply addressing the rising cost of college isn’t sufficient to ensure students are being equipped with the degrees and skills they need to succeed.

Among our key findings: