Alaska’s state university system is delivering some of the best bargains in the nation in terms of Alaskans’ earnings after graduation compared with what they pay for their college degrees or certificates.
A new Georgetown University study of 4,529 U.S. universities and colleges, including vocational and career institutions, put the University of Alaska system near the top the heap.
University of Alaska Anchorage ranked in the top 15 percent of the nationwide sample group in terms of the long-term, 40-year earnings from a four-year college degree. University of Alaska Fairbanks and University of Alaska Southeast weren’t far behind.
“What’s important about this is that is shows that students in Alaska’s universities are getting a very good return for their investment. UAA shows up as having particularly good value but UAF and UAS aren’t far behind,” said Erin Holmes, in UAA’s Institutional Research Group.
UAA graduates carried an average of $9,597 in debt, the Georgetown survey showed. After 40 years, UAA graduates had earned $963,000 in Net Present Value, according to the survey. With that, UAA ranked 696th out of 4,529 institutions of higher learning in the study. UAF graduates carried $9,500 in debt, on average, and earned $827,000 after 40 years, in Net Present Value. At University of Alaska Southeast in Juneau graduates carried an average debt load of $9,152 and earned $765,999 after 40 year, again in Net Present Value.
“Net present value is how much a sum of money in the future is valued today,” UAA said of its summary of the Georgetown survey. “The report measured costs and future earnings over 10 and 40-year timeframes. Researchers also adjusted earnings based on time-to-degree estimates.”
Georgetown’s report, “A First Try at ROI: Ranking 4,500 Colleges,” was published in late November by its Center on Education and the Workforce. It is believed to be the first comprehensive national survey of is kind.
The Georgetown researchers used data from the U.S. Department of Education’s 2019 “College Scorecard,” which reported on 2017 data, to determine the long-term return on investment in a college education. “Historically, individuals with a bachelor’s degree earn much more than those with a high school diploma – 65 percent more in 2017,” the University of Alaska Anchorage said in a summary of the Georgetown report.
As college costs have increased, researchers (at Georgetown) chose to look at earnings and costs incurred to measure a student’s return on investment. “Researchers used information on prices of college, median debt and median earnings from 4,529 public, private nonprofit, and private for-profit colleges. The institutions in the survey offer bachelor’s degrees, associate degrees, and certificates,” UAA said in the summary.
Researchers then calculated median earnings over 10 years and 40 years into the future using a net present value formula to rank each institution in those categories.
“As the (Georgetown) report explains, ‘Looking at a 10-year horizon, a student considering an investment in a certificate (assuming completion in a year) would have positive earnings for nine years and incur an investment cost only in the first year.’ For a four-year degree, the Georgetown researchers assumed graduation in five years, for positive earnings in 35 years for the 40-year projection,” UAA said in the summary.
Georgetown’s report also showed that graduates from the Alaska university system carry less debt, on average, than higher education institutions in the Pacific Northwest, including Montana and Idaho, that compete with the University of Alaska for high school graduates.
UAA graduates carried an average of $9,597 in debt, comparing favorably against Washington State University with graduates at an average of $14,772 in debt; Central Washington University with graduates at an average of $14,669; Montana State University with graduates at an average of $13,000; Northern Arizona University, with graduates at an average of $12,500, and Boise State University, with graduates at an average of $14,665.
College debt carried at graduation is one way that costs of education can be compared among institutions but there are factors that influence the comparison. For example, Alaska college students may pay a higher proportion of their college expense through working part-time while in school compared with students in Lower 48 universities and colleges.
Holmes, at UAA’s Institutional Research Group, said 90 percent of UAA students work part-time and there are similar high percentages of working students at UAF and UAS.
Other Alaska higher education institutions also fared well in the Georgetown survey. Alaska Pacific University graduates were carrying an average of $12,900 in debt with a 40-year Net Present Value of earnings at $827,000. Two career education and training institutions, which mainly offer two-year programs, fared well, also.
Graduates of Alaska Vocational Technical Center, or AVTEC, in Seward carried an average debt of $5,257 and earned $946,000 after 40 years, in terms of Net Present Value. Graduates of Alaska Career College in Anchorage carried average debt of $7,199 and earned $703,000 over 40 years, in terms of Net Present Value.
Community colleges and certificate programs have the highest return on investment in the short term, typically measured in 10 years, because students finish their credentials earlier and begin earning faster, the Georgetown researchers said. UAA ranked in the top half of all institutions, or at 2,094 out of 4,529, for best short-term return on investment.
Colleges that offer predominantly bachelor’s degrees have the highest ROI in the long term, measured at 40 years, because they produce higher earnings eventually and overtake returns from most two-year programs. Georgetown researchers said that the best comprehensive benchmark for judging value is measuring the long-term return on investment, at the 40-year mark.
The Georgetown survey can be found at:
UAAranked 696 out of 4,529 placing it in
the top 15% of ALL institutions for best
long-term return on investment
#1in long-term ROI among
our peer institutions.
Weber State University
Ferris State University
College of Staten Island CUNY Florida Gulf Coast University of West Florida McNeese State University Northern Kentucky University
Boise State University
Purdue University Fort Wayne Youngstown State University Northwestern State University of Louisiana Idaho State University of Arkansas at Little Rock Western Kentucky University
Long term debt
Colleges that offer predominantly bachelor’s degrees have the highest ROI in the long term (40 years) because they produce higher earnings eventually and overtake returns from most 2-year awards.
The report concludes that the best comprehensive benchmark for judging value is measuring the long-term return on investment.
Short term debt
Community colleges and certificate programs have the highest ROI in the short term (10 years) because students finish their credentials earlier and begin earning faster.
UAA ranked in the top half of all institutions (2,094 out of 4,529) for best short-term return on investment and No. 4 among our peer institutions.
The net present value is how much a sum of money in the
future is valued today. The report measured costs and
future earnings over 10- and 40-year timeframes. Researchers also adjusted earnings based on time-to-degree estimates. As the report explains, “Looking at a 10-year horizon, a student considering an investment in a certificate (assuming completion in a year) would have positive earnings for nine years and incur an investment cost only in the first year.” For a four-year degree, they assumed graduation in five years, for positive earnings in 35 years for the 40-year projection.