According to the most recent data, nearly half of America’s college students drop out before obtaining their degree. However, they are leaving school with something else: student loan debt.
A recent report from the Education Sector, a think tank, shows that 30 percent of college students who took out loans eventually dropped out. As Anthony Carnevale, director of Georgetown’s Center on Education and the Workforce, noted, this is a problem because of the severe drop in earning potential that occurs when a student leaves school without a degree:
“In the end, it’s about money and time,” said Anthony Carnevale, director of the Center on Education and the Workforce at Georgetown University. “There’s almost a synergy between the two that will knock you out of school.”
The cost to the economy is roughly half a trillion dollars, he said. Although college dropouts make more than those with only a high school diploma, he said they earn about a million dollars less than college graduates over their careers.
Among 18 countries tracked by the Organization for Economic Cooperation and Development, “the United States finished last (46 percent) for the percentage of students who completed college once they started it.”
In 2010, the total cost in lost earnings and tax revenue due to college dropouts in America was $4.5 billion. In California alone, “college dropouts are losing nearly $15 billion in earnings over their work lives, costing the federal government more than $3 billion in lost income taxes.”