Low-Earning Degrees, Student Aid, and the Rising Cost of College

How Earnings-Based Accountability Policies Could Reshape Access to Public Service Professions

The Federal Policy Targeting “Low-Earning Degrees”

The bill, commonly described as the plan to stop funding “low-earning degrees,” is a federal higher-education accountability measure that ties access to federal student aid, such as Pell Grants and federal student loans, to graduates’ earnings. Under this approach, college programs are evaluated using an earnings-premium test requiring undergraduate programs to show that their typical graduates earn more than workers with only a high school diploma, and that Graduate programs demonstrate earnings above those of typical bachelor’s-degree holders. Programs that repeatedly fail this benchmark over multiple years can lose eligibility for federal aid, meaning students enrolled in those programs would no longer be able to use federal grants or loans to pay for tuition or living expenses (U.S. Department of Education, 2023).

Supporters argue that the policy protects students and taxpayers by discouraging enrollment in programs that do not produce sufficient economic returns. From this perspective, accountability measures help ensure that federal student aid is directed toward educational pathways that lead to sustainable employment and manageable debt. Advocates also contend that tying aid eligibility to labor-market outcomes may encourage institutions to align academic offerings with workforce needs, improving transparency for prospective students (Deming & Figlio, 2016).

Critics, however, argue that the policy measures educational value almost entirely through short-term earnings. This approach disadvantages licensed, public-service, and care-based professions such as counseling, social work, public health education, cosmetology, and barbering. These fields frequently produce modest wages, delayed earnings due to required internships or licensure processes, or income structures that are difficult to capture in federal wage data. Although the policy does not directly eliminate degrees or licenses, it can effectively defund the educational pathways required to enter these professions, potentially limiting who can afford to train for them.

Rising Tuition and Administrative Expansion in Higher Education

To understand the broader implications of the policy, it’s important to examine the economic context in which it is being proposed. Over the past several decades, the cost of higher education in the United States has increased dramatically. Between 1980 and 2020, the inflation-adjusted cost of attending a four-year college, including tuition, fees, room, and board, rose by roughly 180 percent (Hanson, 2024). Similar trends are documented in national reports on college pricing and student aid, which show consistent long-term growth in tuition and student borrowing (College Board, 2023).

While multiple factors contribute to rising tuition, changes in institutional spending patterns play an important role. Executive salaries at colleges and universities have increased substantially during the same period. Average presidential compensation has risen by approximately 209 percent at public universities and roughly 316 percent at private institutions. These increases far outpace both inflation and the salary growth experienced by most faculty members.

Administrative expansion has also accelerated. Administrative positions grew by roughly 60 percent between 1993 and 2009, a rate approximately ten times that of tenured faculty positions (Weinstein, 2023). Over a longer period, the expansion becomes even more striking. Full-time administrators increased by approximately 164 percent between 1976 and 2018.

In addition, “professional staff” roles, including advising, compliance, diversity initiatives, human resources, and student support services, expanded by approximately 452 percent during the same period. These trends suggest that a growing portion of institutional resources is devoted to administrative infrastructure rather than direct instruction or academic programming (Weinstein, 2023).

Executive Salaries and Administrative Bloat

The imbalance in the policy conversation about higher education costs fails to account for the sharp increase in executive-level salaries and administrative positions. While lawmakers increasingly seek to regulate academic programs based on graduates’ earnings, far less attention has been paid to the institutional spending patterns that have contributed significantly to rising tuition. Executive compensation, administrative expansion, and the rapid growth of non-instructional staffing have reshaped university budgets over the past several decades.

If policymakers are genuinely concerned about student debt and the economic return on education, then accountability efforts should examine these structural cost drivers as closely as they evaluate graduates’ wages. In other words, the current policy framework risks regulating educational outcomes while ignoring the institutional decisions that shape the cost of education. Addressing tuition inflation requires not only evaluating program outcomes but also confronting universities’ internal financial priorities.

Meaningful reform would therefore require greater transparency and accountability in university budgeting. Policymakers could explore mechanisms such as tying federal funding eligibility to limits on administrative growth, increasing oversight of executive compensation at publicly funded institutions, or requiring institutions to demonstrate that new administrative expenditures directly support educational outcomes. Without addressing these structural factors, efforts to control student debt by eliminating “low-earning degrees” may treat symptoms rather than causes.

The Limits of Measuring Education by Graduate Earnings

Within this broader financial landscape, the proposed accountability policy places responsibility for educational value largely on graduates’ earnings. Programs that produce lower wages, even when those professions serve important social roles, are at risk of losing federal aid eligibility.

This approach risks reinforcing a narrow economic definition of education. Historically, higher education has served multiple purposes beyond workforce preparation. Universities generate knowledge through research, cultivate civic engagement, and train professionals who contribute to the public good (Archibald & Feldman, 2018).

When educational value is assessed primarily through graduate earnings, these broader functions become marginalized. Economic outcomes remain important indicators, but they cannot fully capture the societal contributions of professions that support community well-being.

Fields such as social work, addiction counseling, early childhood education, and community health illustrate this tension clearly. These professions often require extensive education and training but operate within sectors where wages remain relatively modest. Compensation levels reflect the funding structures of nonprofit organizations, public agencies, and community services rather than the importance of the work itself.

Regional Labor Markets and Public Service Careers

Earnings-based evaluation systems also overlook important geographic and demographic differences in labor markets. Graduates who choose to work in rural communities, underserved urban areas, or nonprofit sectors frequently earn less than those employed in private-sector positions in major metropolitan areas.

Programs that intentionally prepare students for these careers may therefore appear ineffective under federal earnings benchmarks, even though their graduates are addressing critical workforce shortages. Mental health counseling, addiction recovery services, and community-based public health are all fields currently experiencing growing demand for trained professionals.

If institutions begin reducing programs associated with lower wage outcomes, the policy may unintentionally worsen shortages in exactly the areas where communities need professionals the most.

The Problem with Federal Earnings Data

Another challenge involves how earnings data are collected and interpreted. Federal evaluation systems typically rely on tax records and wage reporting data. While these datasets provide useful information for many occupations, they do not always capture the full financial realities of certain professions.

For example, cosmetology and barbering often involve tip-based income, independent contracting, and small-business ownership. These forms of compensation may not be fully reflected in federal wage databases, leading to artificially low earnings estimates.

Similarly, entrepreneurial, freelance, and creative careers often involve fluctuating income in the early years of employment. Programs serving these sectors may appear unsuccessful when evaluated using narrow timeframes, even though graduates eventually achieve stable, successful careers.

Licensing Requirements and Delayed Earnings

Timing presents an additional challenge for earnings-based accountability measures. Many licensed professions require extended periods of supervised practice before individuals achieve full professional status.

Mental health counselors, psychologists, and clinical social workers often complete thousands of supervised hours after earning their degrees before obtaining licensure. During this period, wages may remain relatively low despite strong long-term career prospects.

Evaluating academic programs based primarily on early-career wages, therefore, risks penalizing fields that include lengthy professional development requirements designed to protect public safety and service quality.

Access to Education and Growing Inequality

If federal loans and grants become unavailable for certain programs, students pursuing these careers may face significant financial barriers. Without access to federal aid, students may need to pay tuition and living expenses out of pocket, rely on private loans with higher interest rates, or abandon their educational plans altogether.

These barriers are likely to disproportionately affect low-income and first-generation students. Individuals from wealthier families may still be able to pursue lower-paying professions because they have alternative financial support. Students who rely on federal aid, however, may be forced to choose higher-paying fields even when their interests or talents lie elsewhere.

Workforce Shortages and Rising Service Costs

Reduced access to educational pathways could also affect the supply of the workforce. If fewer students enter fields such as counseling, social work, cosmetology, or community health, the availability of these services may decline.

As supply decreases, the cost of services provided by these professionals may increase. Communities that already face limited access to care, particularly those found in rural and underserved areas, could experience even greater shortages.

In response, professional licensing boards and state regulators may eventually face pressure to shorten training requirements or develop alternative pathways into these professions. While such reforms might expand access, they could also raise concerns about maintaining professional standards.

Rethinking Accountability in Higher Education Policy

Ultimately, the debate surrounding “low-earning degrees” reflects a deeper question about both the purpose of higher education and the sources of its rising cost. Evaluating academic programs solely through graduate earnings risks narrowing educational opportunity while ignoring the institutional spending patterns that have contributed to tuition inflation. Professions such as counseling, social work, cosmetology, and community health may not generate the highest wages, but they provide services that communities rely upon every day.

If policymakers are serious about protecting students and taxpayers, accountability must extend beyond graduates’ salaries to the financial decisions universities themselves make regarding administrative needs and executive-level compensation. Addressing administrative expansion, improving transparency in executive compensation, and prioritizing investment in instruction would confront the structural drivers of rising tuition while preserving access to essential professions. Without such reforms, policies aimed at eliminating “low-earning degrees” may ultimately punish students and communities rather than solving the underlying problem.

References

American Association of University Professors. (2023). The annual report on the economic status of the profession, 2022–23. AAUP. https://www.aaup.org

Archibald, R. B., & Feldman, D. H. (2018). Why does college cost so much? Oxford University Press.

College Board. (2023). Trends in college pricing and student aid 2023. College Board. https://research.collegeboard.org

Deming, D. J., & Figlio, D. (2016). Accountability in U.S. education: Applying lessons from K–12 experience to higher education. Journal of Economic Perspectives, 30(3), 33–56. https://doi.org/10.1257/jep.30.3.33

Hanson, M. (2024). Average cost of college and tuition inflation in the U.S. Education Data Initiative.https://educationdata.org

National Center for Education Statistics. (2023). Digest of education statistics. U.S. Department of Education.https://nces.ed.gov

U.S. Department of Education. (2023). Gainful employment and financial value transparency framework.https://www.ed.gov

Webber, D. A. (2020). Are college costs really rising? Evidence from institutional spending. Education Finance and Policy, 15(1), 1–23. https://doi.org/10.1162/edfp_a_00264

Weinstein, P. (2023). Administrative bloat at U.S. colleges is skyrocketing. Forbes. https://www.forbes.com

Dak Kopec is an internationally recognized Architectural Psychologist and Professor at the University of Nevada, Las Vegas, specializing in the intersection of design and human behavior. A two-time prize-winning author, he has published several influential books, including Environmental Psychology for Design and Person-Centered Health Care Design, as well as thought-provoking fiction such as Broken Boys: Beyond Friendships and Logan’s Legacy: Beyond Blood. His current research explores the role of storytelling and contemporary fiction in better understanding human needs within the design process.

Throughout his career, Dak has held prestigious academic and advisory roles, including an Appointment by Hawaiian Governor Neil Abercrombie to the Hawaii Sub-Area Planning Council (HSAC) and visiting professor at the University of Hawaii, with joint appointments in the Schools of Architecture and Medicine. A Fulbright Specialist and two-term Fulbright Reviewer, he has also been invited by the governments of Costa Rica, Lithuania, and Taiwan.