Study Conclusion: Student Debt Severely Impacts Future Student Success
A recent study (link to obtain the report) by Purdue University and The Gallup poll concluded that the level of student debt limits future success of college graduates. The study also concluded that it’s not where a student goes to college that matters in future success but how and what the student did in college no matter where the student went to college.
According to the report, “Three times fewer graduates who took out between $20,000 and $40,000 in undergraduate student loan debt are thriving in their well-being compared with those with no school loan debt. Twenty-six percent of graduates with no debt have started their own business, compared with 16% for those with $40,000 or more.”
“It turns out that student debt hinders our national economy just as it hinders the individual life prospects of students who borrow too much of it,” according to Purdue President Mitch Daniels.
The study also concluded that “there is no difference in workplace engagement or a college graduate’s well-being if they attended… a highly selective institution, or a top 100-ranked school in U.S. News & World Report (and that) students who were closely engaged with faculty or participated in an internship-type program were more likely to be engaged at work and have high well-being.”
At College Inside Track, we believe that students should be given every opportunity to succeed and are passionate about working with families to find the right college at the right cost so that they do not have to incur unmanageable debt that will limit their student’s future success.
The entire press release is below:
Gallup-Purdue index releases inaugural findings of national landmark study
It’s Not ‘Where’ You Go To College, But ‘How’ You Go To College
Level of Debt Limits Individual Success and National Economy
Washington, DC – May 6, 2014 — Gallup, in partnership with Purdue University and Lumina Foundation, today released results from the inaugural Gallup-Purdue Index that finds there is no difference in workplace engagement or a college graduate’s well-being if they attended a public or private not-for-profit institution, a highly selective institution, or a top 100-ranked school in U.S. News & World Report. The study found students who were closely engaged with faculty or participated in an internship-type program were more likely to be engaged at work and have high well-being. The study also outlines a relationship between the level of student debt and a graduate’s well-being and entrepreneurial experience.
This comprehensive, nationally representative study of more than 30,000 U.S. college graduates with Internet access will be released annually for the next five years and is based on Gallup’s decades of research experience in employee engagement and well-being An engaged individual is involved in and enthusiastic about their work, is loyal, and productive. Those who are thriving are strong, consistent and progressing. The Gallup-Purdue Index is not a new ranking or rating system but a response to the call for increased accountability in higher education. This study is the first of its kind and will serve as a national benchmark.
The study found that 39% of U.S. graduates are engaged at work without distinction between public vs. private not-for-profit colleges, but there was a substantial difference between graduates of for-profit institutions and the rest. While most graduates are thriving in one or more key dimensions of well-being – purpose, social, financial, community, and physical – 11% are thriving in all five categories.
Graduates who had at least one professor who made them excited about learning, cared about them as a person, and was a mentor, have more than double the odds of being engaged at work and being thriving in well-being. Only 14% of graduates strongly agreed with all three of these questions.
Three times fewer graduates who took out between $20,000 and $40,000 in undergraduate student loan debt are thriving in their well-being compared with those with no school loan debt. Twenty-six percent of graduates with no debt have started their own business, compared with 16% for those with $40,000 or more.
“It turns out that student debt hinders our national economy just as it hinders the individual life prospects of students who borrow too much of it,” according to Purdue President Mitch Daniels. “It is past time for leaders in higher education to go to work on restraining costs and making sure that our doors remain open to all students who meet our standards.”
“The Gallup-Purdue Index makes it clear that how students are engaged in learning is essential to meeting their individual needs and those of the country,” said Jamie Merisotis, president and CEO of Lumina Foundation. “The type of college or university a person attends and the institution’s ‘ranking’ is less relevant at a time when the nation’s need for talent puts students’ life and work outcomes at the heart of the learning enterprise.”
Graduates who had experiential and deep learning such as a job/internship, long-term school project, and were extremely involved in extra-curricular activities and organizations, had double the odds of being engaged at work and slightly more are thriving. Graduates who finished their degrees in four years, double their odds of being engaged. Only 6% of graduates strongly agree they had a meaningful internship or job, worked on a long-term project, and were actively involved in extra-curricular activities.
“Making connections between classroom learning and real life applications of that learning is key in preparing college graduates for that great job,” commented John H. Pryor, senior research scientist for Gallup and lead researcher for the Gallup-Purdue Index. “There is a need to increase the exposure college students have with experiences that enrich their academic learning by making internships and partnerships with faculty and industry and organizations available to all students.”
With a national benchmark established with this study, Purdue University – and many others – plan to understand how their alumni are doing on these measures and how they can establish a process for continuous improvement aimed at increasing the likelihood that their graduates have great jobs and great lives. Through its partnership with Gallup, Purdue will conduct a survey of all their alumni that will allow for comparisons to the national benchmark and for in-depth research specific to Purdue. Other leading institutions of higher education have made the same commitment.
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About Gallup
Gallup has studied human nature and behavior for more than 75 years. Gallup’s reputation for delivering relevant, timely, and visionary research on what people around the world think and feel is the cornerstone of the organization. Gallup employs many of the world’s leading scientists in management, economics, psychology, and sociology, and our consultants assist leaders in identifying and monitoring behavioral economic indicators worldwide. Gallup consultants help organizations boost organic growth by increasing customer engagement and maximizing employee productivity through measurement tools, coursework, and strategic advisory services. Gallup’s 2,000 professionals deliver services at client organizations, through the Web, at Gallup University’s campuses, and in more than 40 offices around the world.
About Purdue University
Purdue University is a vast laboratory for discovery. The university is known not only for science, technology, engineering, and math programs, but also for our imagination, ingenuity, and innovation. It’s a place where those who seek an education come to make their ideas real – especially when those transformative discoveries lead to scientific, technological, social, or humanitarian impact.
Founded in 1869 in West Lafayette, Indiana, the university proudly serves its state as well as the nation and the world. Academically, Purdue’s role as a major research institution is supported by top-ranking disciplines in pharmacy, business, engineering, and agriculture. More than 39,000 students are enrolled here. All 50 states and 130 countries are represented.
About Lumina Foundation
Lumina Foundation is an independent, private foundation committed to increasing the proportion of Americans with high-quality degrees, certificates and other credentials to 60 percent by 2025. Lumina’s outcomes-based approach focuses on helping to design and build an accessible, responsive and accountable higher education system while fostering a national sense of urgency for action to achieve Goal 2025.
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Media Contacts:
Leticia McCadden
202-715-3156
[email protected]
Shelley Triol
765-494-2076
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Lucia Anderson Weathers
317-951-5316
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Related video: https://www.youtube.com/watch?v=NIGKVxBisY8
Methodology
Results for the Gallup-Purdue Index are based on web surveys conducted Feb. 4 through March 7, 2014, with a random sample of approximately 1,557 respondents with an associate’s degree and 29,560 respondents with a bachelor’s degree or higher, aged 18 and older, with Internet access, living in all 50 U.S. states and the District of Columbia.
The Gallup-Purdue Index sample was compiled from two sources; the Gallup Panel and the Gallup Daily Tracking survey.
The Gallup Panel is a proprietary, probability-based longitudinal panel of U.S. adults that are selected using random-digit-dial (RDD) and address-based sampling methods. The Gallup Panel is not an opt-in panel. The Gallup Panel includes 60,000 individuals, Panel members can be surveyed by phone, mail, or Web. Gallup Panel members with a college degree, and that have access to the Internet were invited to take the Gallup-Purdue Index survey online.
Gallup Daily tracking includes two parallel surveys — the U.S. Daily and the Gallup-Healthways Well-Being Index®. Each sample of national adults include a minimum quota of 50% cellphone respondents and 50% landline respondents, with additional minimum quotas by time zone within region. Landline and cellular telephone numbers are selected using random-digit-dial methods. Landline respondents are chosen at random within each household on the basis of which member had the most recent birthday. Gallup Daily tracking respondents with a college degree, that agreed to future recontact, were invited to take the Gallup-Purdue Index survey online.
Gallup-Purdue Index interviews are conducted with respondents via the Web, in English only. Samples are weighted to correct for unequal selection probability and nonresponse. The data are weighted to match national demographics of gender, age, race, Hispanic ethnicity, education, and region. Demographic weighting targets are based on the most recent Current Population Survey figures for the aged 18 and older associate’s degree population and U.S. bachelor’s degree or higher population. Weighting was conducted separately for the two groups (associate’s degree population and bachelor’s degree population).
All reported margins of sampling error include the computed design effects for weighting.
For results based on the total sample of associate’s degree respondents, the margin of sampling error is ±3.8 percentage points at the 95% confidence level.
For results based on employee engagement of associate’s degree respondents, the margin of sampling error is ±4.8 percentage points at the 95% confidence level.
For results based on the total sample of bachelor’s degree or higher respondents, the margin of sampling error is ±0.9 percentage points at the 95% confidence level.
For results based on employee engagement of bachelor’s degree or higher respondents, the margin of sampling error is ±1.0 percentage points at the 95% confidence level.
In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.