WASHINGTON (AP) — For many young Americans today, the decision of whether or where to attend college has evolved into a complicated calculation of expenses versus potential gains, all often centered around one pivotal question: Is the degree worth the investment?

Confidence in higher education has taken a sharp decline recently, influenced by soaring tuition fees, escalating student debt, and a challenging employment landscape, compounded by ideological critiques from conservative voices. As a result, colleges are now under pressure to demonstrate their value to prospective students.

The business term “return on investment” has become a fixture in college marketing across the nation. A slew of new rankings evaluate institutions based on the financial advantages they provide. States like Colorado have begun issuing annual reports assessing the economic benefits of college education, while Texas has integrated these considerations into its funding formulas for community colleges.

“Students are increasingly aware of the instances when college fails to deliver,” remarked Preston Cooper, who has conducted research on college ROI at the American Enterprise Institute, a conservative think tank. “Universities are now prioritizing this issue in a way that wasn’t necessarily the case 15-20 years ago.”

Most bachelor’s degrees are still worth it

Research consistently shows that earning a bachelor’s degree still offers financial benefits, at least on average, over the long term. However, there is a growing awareness that not all degrees translate to substantial earnings, and even those that traditionally promised good returns are becoming less certain as graduates navigate one of the toughest job markets in recent memory.

A new analysis released Thursday by the Strada Education Foundation finds 70% of recent public university graduates can expect a positive return within 10 years — meaning their earnings over a decade will exceed that of a typical high school graduate by an amount greater than the cost of their degree. Yet it varies by state, from 53% in North Dakota to 82% in Washington, D.C. States where college is more affordable have fared better, the report says.

It’s a critical issue for families who wonder how college tuition prices could ever pay off, said Emilia Mattucci, a high school counselor at East Allegheny schools, near Pittsburgh. More than two-thirds of her school’s students come from low-income families, and many aren’t willing to take on the level of debt that past generations accepted.

Instead, more are heading to technical schools or the trades and passing on four-year universities, she said.

“A lot of families are just saying they can’t afford it, or they don’t want to go into debt for years and years and years,” she said.

Education Secretary Linda McMahon has been among those questioning the need for a four-year degree. Speaking at the Reagan Institute think tank in September, McMahon praised programs that prepare students for careers right out of high school.

“I’m not saying kids shouldn’t go to college,” she said. “I’m just saying all kids don’t have to go in order to be successful.”

Lowering college tuition and improving graduate earnings

American higher education has been grappling with both sides of the ROI equation — tuition costs and graduate earnings. It’s becoming even more important as colleges compete for decreasing numbers of college-age students as a result of falling birth rates.

Tuition rates have stayed flat on many campuses in recent years to address affordability concerns, and many private colleges have lowered their sticker prices in an effort to better reflect the cost most students actually pay after factoring in financial aid.

The other part of the equation — making sure graduates land good jobs — is more complicated.

A group of college presidents recently met at Gallup’s Washington headquarters to study public polling on higher education. One of the chief reasons for flagging confidence is a perception that colleges aren’t giving graduates the skills employers need, said Kevin Guskiewicz, president of Michigan State University, one of the leaders at the meeting.

“We’re trying to get out in front of that,” he said.

The issue has been a priority for Guskiewicz since he arrived on campus last year. He gathered a council of Michigan business leaders to identify skills that graduates will need for jobs, from agriculture to banking. The goal is to mold degree programs to the job market’s needs and to get students internships and work experience that can lead to a job.

A disconnect with the job market

Bridging the gap to the job market has been a persistent struggle for U.S. colleges, said Matt Sigelman, president of the Burning Glass Institute, a think tank that studies the workforce. Last year the institute, partnering with Strada researchers, found 52% of recent college graduates were in jobs that didn’t require a degree. Even higher-demand fields, such as education and nursing, had large numbers of graduates in that situation.

“No programs are immune, and no schools are immune,” Sigelman said.

The federal government has been trying to fix the problem for decades, going back to President Barack Obama’s administration. A federal rule first established in 2011 aimed to cut federal money to college programs that leave graduates with low earnings, though it primarily targeted for-profit colleges.

A Republican reconciliation bill passed this year takes a wider view, requiring most colleges to hit earnings standards to be eligible for federal funding. The goal is to make sure college graduates end up earning more than those without a degree.

Others see transparency as a key solution.

For decades, students had little way to know whether graduates of specific degree programs were landing good jobs after college. That started to change with the College Scorecard in 2015, a federal website that shares broad earnings outcomes for college programs. More recently, bipartisan legislation in Congress has sought to give the public even more detailed data.

Lawmakers in North Carolina ordered a 2023 study on the financial return for degrees across the state’s public universities. It found that 93% produced a positive return, meaning graduates were expected to earn more over their lives than someone without a similar degree.

The data is available to the public, showing, for example, that undergraduate degrees in applied math and business tend to have high returns at the University of North Carolina at Chapel Hill, while graduate degrees in psychology and foreign languages often don’t.

Colleges are belatedly realizing how important that kind of data is to students and their families, said Lee Roberts, chancellor of UNC-Chapel Hill, in an interview.

“In uncertain times, students are even more focused — I would say rightly so — on what their job prospects are going to be,” he added. “So I think colleges and universities really owe students and their families this data.”

___