Salary Earnings, Loan Amounts Borrowed Based on Transfer and Degree Attainment

• In Event: Collaborative Scholar-Practitioner Efforts to Use NCES Data for Higher Education Research

Abstract

Research Question and Dataset

This study uses data from the 2012/2017 Beginning Postsecondary Students Longitudinal Study to compare labor market and financial outcomes. We were guided by the following research questions: 1) How does degree completion influence (a) amount borrowed and (b) labor market outcomes for students? 2) How do cumulative amount borrowed and labor market outcomes change for vertical transfer students, degree attainment status, or by major choice?

Literature

The percentage of undergraduates securing student loans is not equitable across groups, with 82% of Black students securing loans, compared to 68% of White undergraduates, 61% Hispanic/Latine undergraduates, and 42% Asian undergraduates (National Postsecondary Student Aid Study, 2018). While there are positive returns to a bachelor's degree attainment (Abel & Deitz, 2014), the findings are mixed for two-year to four-year transfer students. Some report positive results (Lobo & Burke-Smalley, 2018; Petronijevic & Oreopoulos, 2013) and heterogeneous effects by demographics and field of study (Lobo & Burke-Smalley, 2018; Xu et al., 2020). Xu et al. (2020) found female community college students are less likely to gain full-time employment in general.

Methods

With BPS: 2012/17 data, we conducted descriptive and OLS and logistic regression analysis to answer our research questions. We explore the difference in completers vs. non-completers and 2-year to 4-year transfers vs. 4-year college natives (Appendix Table 1). Regression technique analyzes the relationship between student’s transfer status (i.e., transfer from 2-year to 4-year vs. never transferred) while holding student characteristics (e.g., demographics, major) and institution type constant (Appendix Tables 3 & 4). Appendix Table 2 shows the mean and percentage distribution for the covariates used in the regression models. The labor market outcomes are being employed and annual salary. The student loan outcomes are cumulative amount borrowed and loan delinquency status.

Results

When controlling for race, gender, age, major, and the institution type, students who began at a public, two-year institution made $3,604 less than students who exclusively attended a single, four-year institution (p < .01). Vertical transfer students had 4,557.53 less in student loan debt when compared to students who exclusively attended a single, four-year institution (p < .01). When controlling for race, gender, age and major, students who began at a public, two-year institution were approximately 30% less likely to be employed when compared to their peers who never transferred (p < .10).
White students earned $7,875.96 more than Black or African American students (p < 0.001), and $5,585.35 more than Hispanic or Latino students (p < .001). When compared to education majors, the largest differences found in earnings were computer and information sciences ($30,437.66, p < .001) and engineering and engineering technology ($20,144.84, p < .001).

Significance

We demonstrate community college students have lower amounts of debt who both graduate and do not graduate from college. Students who begin at a community college are better served in their long-term student loan debt accumulation, even when they fail to complete.

Authors

• Matthew P. Ison, Northern Illinois University

• Kim E. Bullington, Old Dominion University

• Jing Li, Harvard University

• Estela Lopez, University of Wisconsin - Madison