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Dropouts in debt face all risk, no reward

It’s bad enough for students to drop out of college and miss the undeniable advantages of a degree, but to leave with no diploma plus a burden of debt is a double whammy many find difficult to overcome.

“Even though taking out loans is still a sound investment for most students, policymakers and education leaders can hardly be satisfied when borrowers leave school with no degree, a debt to repay and a high risk of defaulting on their loan,” says Patrick Callan, president of the National Center for Public Policy and Higher Education, which published a report, “Borrowers Who Drop Out,” in May. “In some cases, these students are worse off than before.”

The May 2005 study, written by Lawrence Gladieux, an independent policy consultant, and Laura Perna, assistant professor of higher education at the University of Maryland, shows that half of all entering freshmen borrow to finance postsecondary education, and 20 percent of those borrowers drop out. The dropout borrowers are 10 times more likely than degreed borrowers to default on their loans and twice as likely to be unemployed six years after they began as freshmen, according to statistics from students who enrolled in a four-year institution in 1995-96. Dropouts in debt find themselves in a double bind: On the one hand, borrowing costs money, and on the other, delaying education, enrolling part time or working full time while in college are risk factors for dropping out.

If the rate of borrowing is any gauge, students attending less-than-four-year, for-profit institutions face the biggest challenge. The highest percentage of borrowers is found here: 68 percent go into debt to finance their education within six years of enrolling in private for-profit, less-than-four-year institutions. By contrast, 33 percent of the freshmen at public two-year colleges borrow. At four-year institutions, 67 percent of freshmen who expect to attain at least a bachelor’s degree borrow.

Debt for students pursuing a four-year degree averages $15,000 to $20,000 by graduation. Those in low-income and minority groups have higher debt burdens.
Go to http://www.highereducation.org/ to see the report.

Reports show many staffing disparities

Two May reports from the National Center for Education Statistics (NCES) show an uneven landscape for staff and faculty at universities and colleges in the United States, with a growing number of part-time faculty, racial and gender disparities in rank and salary, and disadvantages at for-profit institutions.

Part-timers constituted about 44 percent of all faculty and instructional staff in fall 2003, according to the 2004 National Study of Postsecondary Faculty Report on Faculty and Instructional Staff in Fall 2003. Statistics based on similar data in the NCES Digest of Education Statistics (www.nces.ed.gov/programs/digest/) show that between 1991 and 2001, the percentage of faculty who worked full time declined from 64.8 percent to 55.5 percent, indicating a distinct rise in the use of part-time workers. Educators worry that such a reduction in resources threatens the quality of the education that students receive.
Other striking statistics are to be found in the report Staff in Postsecondary Institutions, Fall 2003, and Salaries of Full-Time Instructional Faculty, 2003-04, released May 18, especially regarding the gender share of jobs on campus. For example:

  • Women’s share of faculty positions. While half (53 percent) of all staff are women, including full- and part-time professional and nonprofessional workers, just 39 percent of faculty, defined as staff whose principal activity is instruction, research or public service, are women.

  • Faculty women’s salaries. Full-time instructional faculty on 9/10-month contracts earn an average of $55,000 if they are women, $68,000 if they are men. Professors, the highest rank, earn an average of $77,000 if female and $88,000 if male.

  • Gender tenure disparities. The staffing report shows that a larger proportion of men than women hold tenure. Among full-time faculty men, about 50 percent are tenured; among women in the same category, 36 percent.

  • Racial/ethnic disparities. Both reports show 80 percent of full-time faculty at degree-granting institutions are white, 5 percent black, 3 percent Hispanic, 6.5 percent or 9 percent Asian/Pacific Islander (in the staff and faculty reports, respectively) and 5 percent or 2 percent other racial/ethnic groups (staff and faculty reports, respectively). The reports differ because they surveyed different samples of personnel.

  • Racial/ethnic tenure rates. Tenure among minorities is also less common than it is among whites. Among full-time white faculty, 47 percent have tenure; among Asian-Pacific Islanders, 42 percent have tenure; among Hispanics, the figure is 41 percent, and among blacks, 38 percent. Among all full-time faculty, 44.8 percent hold tenure, 20.4 percent are on a tenure track, and 34.8 are not.

  • Salaries at for-profits. Private for-profit institutions pay lower wages. Salaries of full-time instructional faculty on 9/10-month contracts averaged $38,818 at private for-profit schools; at publics, salaries jumped to $60,912, and at private not-for-profits, $66,817. At two-year for-profits, salaries averaged $33,584, compared to $36,841 at two-year not-for-profits and $53,080 at two-year publics.

  • Benefits at for-profits. Average expenditures for benefits, especially retirement plans, lag far behind at for-profit institutions. Retirement plan expenditures at for-profits averaged $1,504, at private not-for-profits $4,260, and at publics $5,329. Medical and dental benefits were also lower. For-profits do offer more “other benefits with in-kind cash options,” spending an average $4,061 in this category compared to $1,051 at private not-for-profits and $1,334 at publics.

  • Fewer new faculty hires at for-profits. Among new full-time hires, 21.3 percent were faculty and 45.5 percent were support and service personnel at for-profits. At private not-for-profits, 31.9 percent were faculty and 27.7 percent were support and service staff, At publics, 39.1 percent were faculty and 26.2 percent were support and service personnel.

       

       

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