75% of master’s programs with high debt and low income are delivered in private non-profit organizations


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Diving Brief:

  • Private, nonprofit institutions offer a disproportionately high number of master’s degree programs whose graduates have high debt and low incomes, according to a recent analysis by the Urban Institute.
  • Although private nonprofit institutions accounted for 44% of all master’s programs in the data, they accounted for 75% of high-leverage, low-income programs.
  • Nearly half of master’s programs with high debt and low income are in the fields of social work, clinical counseling and applied psychology, and mental health and social services. According to Urban Institute researchers, public institutions offer programs in areas where graduate students have significantly less debt than their private and for-profit counterparts, raising questions about degree pricing.

Overview of the dive:

The growing emphasis on master’s degrees, which lead to high debt and low earnings for graduates, could prompt accountability measures from policymakers. But unlike previous efforts, which focused primarily on for-profit institutions, future attempts could largely affect nonprofit institutions and a few fields of study, said Jason Delisle, senior policy fellow at the Urban Institute and co -author of analysis.

The analysis was carried out using College Scorecard data first released by the Department of Education several years ago. The researchers compared median earnings, measured two years after graduation, with the average loan disbursement of students who graduated. They weighted programs by enrollment numbers and analyzed programs with debt-to-income ratios in the top 10%.

This group had an average debt of $77,000 and earned an average of $43,000.

The analysis is limited in part by federal college scorecard data, which does not include degree programs with few graduates due to confidentiality concerns.

Media attention on highly indebted, low-income master’s degrees has focused primarily on arts and humanities degrees, such as music, film, and journalism. Findings about mental health degrees may make the issue of debt and income more difficult for policymakers to rule out, Delisle said.

“If you were to frame this like people getting degrees in music or journalism and can’t pay their debts, it’s a little easier to say ‘Too bad,'” he said. “It’s easier for policy makers to say, ‘Well, it’s just not worth it’ than with these other types of degrees.”

Policymakers could consider caps on federal loans for graduate degrees, according to Delisle. But these caps would also affect degree programs where graduates have high debt but also high incomes, such as nursing programs.

“It’s a much less targeted way of dealing with this problem, at least as we have framed it. It’s much more brutal and would have far more widespread effects on the higher education market than I think policymakers would intend,” Delisle said.

Several factors may explain the fact that public institutions offer master’s degrees in social work, counseling and mental health services at a relatively low cost. It’s possible, Delisle said, that these public institutions are located in relatively low-cost areas, provide a less resource-intensive learning experience for students, or are subsidized by the state more heavily than previously thought. It’s also possible that similar degrees at private, nonprofit colleges are designed to generate more revenue, Delisle said.

Policymakers could consider efforts to expand the class sizes of these degree programs at public institutions. Earnings are similar regardless of facility type, he said.

“Some institutions offer these degrees at significantly lower prices and less debt,” he said. “Maybe a master’s degree in social work doesn’t need to cost $100,000 or even $60,000.”


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