Diplomas and Dropouts

Which Colleges Actually Graduate Their Students (and Which Don't)

Reports & Briefs | | June 11, 2009
Graduation Rates, Higher Education

In the fall of 2001, nearly 1.2 million freshmen began college at a four-year institution of higher education somewhere in the United States. Nearly all of them expected to earn a bachelor's degree. As a rule, college students do not pack their belongings into the back of a minivan in early September wondering if they will get a diploma—only when.

For many students, however, that confidence was misplaced. At a time when college degrees are valuable—with employers paying a premium for college graduates—fewer than 60 percent of new students graduated from four-year colleges within six years. At many institutions, graduation rates are far worse. Graduation rates may be of limited import to students attending the couple hundred elite, specialized institutions that dominate the popular imagination, but there are vast disparities--even among schools educating similar students—at the less selective institutions that educate the bulk of America's college students. At a time when President Barack Obama is proposing vast new investments to promote college attendance and completion, and has announced an intention to see the United States regain leadership in such tallies, these results take on heightened significance.

This report documents the dramatic variation in graduation rates across more than 1,300 of the nation's colleges and universities, even between those with similar admissions criteria and students. Using official U.S. Department of Education graduation rates, this report identifies the top and bottom performers among institutions that have similar levels of admissions selectivity, as reported in the widely used Barron's Profiles of American Colleges. Though completion rates increase as one moves up the selectivity scale, we show that within each category of selectivity, there are large differences between the schools that graduate most students and those that graduate few. While student motivation, intent, and ability matter greatly when it comes to college completion, our analysis suggests that the practices of higher education institutions matter, too.

The institutions covered in this report run the gamut from large, public research universities to small, private liberal arts colleges; from highly selective, world-famous institutions to regional, open admissions ones. America's college graduation rate crisis is not happening at the handful of institutions that admit only a few of their applicants and graduate most—it is happening at a large swath of institutions that admit many but graduate few.

We do not argue that high graduation rates are invariably a good sign or low graduation rates necessarily a bad one. After all, an easy way to pad graduation rates is to drop standards and hand a diploma to every student who walks through the door. And we do not want to suggest that modest differences in graduation rates should be overemphasized--that is why we focus on the extremes.

However, graduation rates as calculated here do convey important information—information that should be readily available to students selecting a school, parents investing in their child's education, and policymakers and taxpayers who finance student aid and public institutions. We believe that the graduation rate measure included here should be just the beginning of a deeper inquiry into college success—one driven by more accurate measures broadly defined: in future earnings, in acquiring knowledge, in workplace success, and ultimately in becoming the kind of citizens who can contribute to the stability and prosperity of our society. . . .

Read the full report Diplomas and Dropouts on the American Enterprise Institute Web site.

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