- Private nonprofit institutions offer a disproportionately high number of the master's degree programs whose graduates have high debt and low earnings, according to a recent analysis from the Urban Institute.
- Although private nonprofit institutions accounted for 44% of all master’s programs in the data, they made up 75% of programs with high debt and low earnings.
- Nearly half of master's programs with high debt and low earnings are in the fields of social work, clinical counseling and applied psychology, and mental and social health services. Public institutions offer programs in those fields that graduate students with significantly less debt than their private and for-profit counterparts, raising questions about degree pricing, according to Urban Institute researchers.
The growing focus on master's degrees that lead to high debt and low earnings for graduates could result in accountability measures from policymakers. But unlike previous efforts, which mostly affected for-profit institutions, future attempts might largely affect nonprofit institutions and a few fields of study, said Jason Delisle, senior policy fellow at the Urban Institute and coauthor of the analysis.
The analysis was conducted using College Scorecard data first released by the Department of Education several years ago. Researchers compared median earnings, measured two years after graduation, with average loan disbursement to students who completed degrees. They weighted the programs by enrollment size and analyzed the programs with debt-to-earnings ratios in the top 10%.
That group had an average debt of $77,000 and earned an average of $43,000.
The analysis is limited in part by the federal College Scorecard data, which does not include degree programs with few completers because of privacy concerns.
Media attention on master's degrees with high debt and low earnings has primarily focused on degrees in the arts and humanities, such as music, film and journalism. The findings regarding degrees in the mental health space may make the issue of debt and earnings harder for policymakers to brush off, Delisle said.
"If you were to frame it as people are getting music degrees or journalism degrees and can’t pay their debts, that's a little bit easier to say, 'Too bad,'" he said. "It’s easier for policymakers to say, ‘Well, that just isn’t worth it’ than with these other types of degrees."
Policymakers might consider caps on federal lending for graduate degrees, according to Delisle. But those caps would also affect degree programs where graduates have high debt but also high earnings, such as nursing programs.
“It’s a much less targeted way of dealing with this issue, at least as we’ve framed it. It’s much more blunt and would have much more widespread effects on the graduate education market than I think policymakers would be intending,” Delisle said.
Several factors may be driving the fact that public institutions are offering master's degrees in social work, counseling and mental health services at relatively little cost. It’s possible, Delisle said, that those public institutions are located in relatively low-cost areas, provide a less resource-intensive learning experience to 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 might consider efforts to expand the class sizes of those degree programs at public institutions. Earnings are similar regardless of the type of institution, he said.
“There are institutions offering these degrees at substantially lower prices and lower debt,” he said. “Maybe a master's of social work doesn’t need to cost $100,000 or even $60,000.”