The Research Institute at Dallas College Launches Tools To Better Understand and Compare Economic Value of Colleges
For many, earning a college credential to get a higher-paying job can be a life-changing accomplishment, improving the economic situation and quality of life for themselves and their families. Traditional college rankings have been criticized for not measuring the aspects of institutions that are most beneficial to students and instead valuing privilege and selectivity. New tools devised by the Dallas College Research Institute can help education leaders as well as prospective students and parents better understand the value of specific colleges and universities, with a special focus on equity by considering multiple demographic factors.
“As pillars of higher education entrusted with the public good, community colleges and four-year colleges need a complete picture of the impact their graduates have on society,” said Dallas College Chancellor Justin Lonon. “That begins with an impartial look at public data, which is why Dallas College has taken the extraordinary step of setting up the Research Institute to better understand the value proposition of community colleges nationally. Ultimately, we will help students and their families, as well as policymakers, understand what they can expect to get out of a community college education before making the leap, and not just at Dallas College.”
As explained by Navi Dhaliwal, economic analyst at the Research Institute at Dallas College, “Students pursue college for many reasons, but economic influences like the opportunity to earn more money or advance one’s career are a major motivation.” He leads the institute’s return on investment (ROI) studies. In fulfillment of its mission to evaluate the role of a Dallas College education in economic mobility, the institute’s agenda focuses heavily on ROI for students. Put simply, is college worth it? And, specifically, is Dallas College worth it?
To help answer that question, Dallas College’s new ROI tool relies on publicly available federal data from the U.S. Department of Education’s “College Scorecard,” as well as survey data from the U.S. Census Bureau, to serve as a baseline for two- and four-year colleges in comparing outcomes across institutions. The research emerging from Dallas College offers a resounding, “Yes, college is worth it,” from the perspective of earnings potential, Dhaliwal said.
Early findings show that over 40 years, those who attend college — either four-year or two-year institutions — earn, on average, hundreds of thousands of dollars more than those with only a high school diploma. All large Texas community colleges offer positive total ROI ranging from $771,000 to $1.1 million, depending on the institution.
Because the onus is on public institutions to ensure a positive return on the financial investments made by taxpayers and students, this research has taken on increased importance. Community colleges, which typically serve a high proportion of low-income students, have the added responsibility of helping to provide economic mobility. Therefore, student ROI and economic mobility are cornerstones of the institute’s research agenda.
The Research Institute examines the ROI of Dallas College in the broader context of Texas community colleges in its report “Does Community College Pay Off? An Initial Look at ROI in Texas.” There is great variation in 40-year returns of institutions. Dallas College represents about the median at $893,000. Most students at Dallas College exceed the Postsecondary Value Commission’s minimum economic threshold. That is, at the median, students are able to recoup the cost of their college education through higher wages than with a high school diploma alone. However, aggregate numbers cannot capture the nuances of student experiences, particularly in institutions as diverse as community colleges, the researchers said.
As the report breaks down estimated ROI for different groups, there is a clear variation among students, depending on their individual characteristics and area of study. One metric in which Dallas College excels is gender equity. Of all institutions in the analysis, Dallas College exhibits the smallest gap between male and female students.
The interactive ROI dashboard allows users to explore ROI across different institutions, programs of study and demographic groups across the country. An integrated custom calculator even allows users to estimate ROI based on demographic factors such as student age, time to completion and income earned during college. This granular look and customizable format set the Research Institute’s work apart and allow education and workforce development leaders to assess policies and practice.
Dhaliwal’s economic mobility index for two-year colleges, which he calls EMI2, integrates multiple approaches to student ROI. Through this new calculation method, institutions can be ranked according to the economic mobility they provide to low-income students.
“The Research Institute at Dallas College is charged with creating action research for prospective and current Dallas College students. It is one of the only research institutes embedded within a community college’s student success division,” said Dr. Beatriz Joseph, Dallas College vice chancellor for student success. While an economic mobility metric already existed to rank four-year institutions, Dr. Joseph recognized the need to adapt popular methodologies to community college contexts.
The Research Institute’s innovative EMI2: Economic Mobility Index for Two-Year Colleges is designed specifically for those institutions and captures the most salient factors for a sector dedicated to advancing the career and economic prospects of local students who need it the most. For institutions that confer predominantly associate degrees, the EMI2 calculates a score from 0-100, based on the following measures for the institution’s low-income students: 10-year ROI, student loan debt and share who complete a credential or transfer to a four-year institution within four years. Results from EMI2 analyses can inform decisions by education leaders and policymakers with greater accuracy and therefore, have great potential to effect change.
“Although college graduates do tend to earn higher wages than those without a degree, there remain serious questions and public concern about the rising costs of college, the burden of student debt and inequities in post-college outcomes,” said Dr. David Mahan, founding executive director of the Research Institute. “Our ongoing study of the return on investment of higher education seeks to develop a more nuanced and accurate assessment of how colleges generate value for the communities they serve.”
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