NCPA - National Center for Policy Analysis

The High Cost of Low Community College Graduation Rates

April 10, 2012

With the current economic downturn and high unemployment rates, the relatively low tuition of community colleges and their open enrollment policies have drawn an increasing number of students.  However, persistently high dropout rates and the failure of students to complete their degree in a timely manner casts doubt on two-year schools' ability to help their students, say Mark Schneider and Lu Michelle Yin of the American Enterprise Institute.

Community colleges cannot help their students to command better jobs and higher salaries if they do not graduate.

  • Community colleges serve about 30 percent of all students in higher education.
  • However, community college three-year graduation rates average in the low 20 percent range, with many colleges graduating far fewer than this average.
  • In 2009, the last year for which the federal government has reported data, close to 400 community colleges had graduation rates less than 15 percent.
  • These figures allow three years for a two-year degree, thereby inflating these schools' graduation figures.

Furthermore, studies show that timely graduation would be largely beneficial to the student, not only because they would not have to pay for another year of tuition, but also because there are numerous openings in the economy for associate's degree holders.

  • In 2009, over 320,000 full-time degree-seeking students who entered community colleges in 2006 had not earned their degree.
  • As a measure of the labor market need for these students, the Bureau of Labor Statistics estimates that the nation has an unmet need of around 300,000 new employees with associate's degrees per year.

A number of recommendations, therefore, can be put forth to help community colleges graduate more students more quickly.

  • Complete College America, an organization that works to increase graduation rates, recommends streamlining remediation programs.
  • Additionally, they emphasize restructuring traditional college programs through block scheduling so that students can plan their lives around a fixed schedule.
  • Furthermore, increasing the availability of online material can be a game-changer for students on tight schedules.

Source: Mark Schneider and Lu Michelle Yin, "Completion Matters: The High Cost of Low Community College Graduation Rates," American Enterprise Institute, April 3, 2012.

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