Examining the New Carnegie Student Access and Earnings Classification at Four-Year Colleges and Universities

A bachelor’s degree remains a key lever to achieve economic success. Median earnings disaggregated by educational attainment demonstrate the importance of a bachelor’s degree for securing a job and making strong earnings. The difference in median weekly earnings of a person with a high school degree ($930) compared to someone with a bachelor’s degree ($1,543) adds up to an additional $32,000 over one year. This wage premium grows even larger as a person advances in their career.

Despite this, Americans hold mixed perceptions of the value of a four-year degree. A 2024 Pew Research Center survey showed that nearly a third of American adults (29 percent) think the cost of college is not worth it today. Nearly half (47 percent) believe that the cost of college is worth it, but only if it can be achieved without taking out loans. These views reflect the increased risk of this investment in the current landscape of increasing tuition costs and student borrowing.

To build awareness of economic value and understand how institutions serve their students, the American Council on Education (ACE) and the Carnegie Foundation for the Advancement of Teaching released the new Student Access and Earnings Classification (SAEC). The SAEC is one classification with two components–an access measure and an earnings measure^[1].

The access measure asks: are institutions providing access to a student population that reflects the locations they serve? It compares an institution’s demographics, specifically its enrollment of Pell Grant recipients and underrepresented minority students,^[2] to the demographics of the states served by that institution. Institutions are classified as either higher or lower access.

The earnings measure asks: after students leave an institution, how much are they making compared to peers in their job market? It compares students’ earnings eight years post-enrollment to the earnings of a similar population with a high school diploma or higher credential in their state. Institutions are classified as either higher, medium, or lower earnings. Based on these two components, institutions fall into one of the following categories:

Table 1: Student Access and Earnings Classification Categories

We sought to understand how four-year institutions are classified using the SAEC. Our analysis focused on the 1,683 four-year institutions for whom an SAEC is available.^[3] In Table 2 below, we summarize each category’s access and earnings information. To highlight a few of the categories:

• The largest group in terms of number of institutions is the Higher Access/Medium Earnings group (40 percent). Students at these institutions had average median earnings of $45,103 eight years post-enrollment. By comparison, median earnings for similarly aged US adults, regardless of educational attainment, are $51,600. For those with less than a bachelor’s degree, median earnings are $41,380.^[4] These institutions were on average 45 percent Pell and 47 percent underrepresented minority students.
• Eighteen percent of four-year institutions are in both the highest access and highest earning category, referred to as the Opportunity Colleges and Universities. Students at four-year Opportunity Colleges and Universities had average median earnings of $52,903 and these institutions were on average 47 percent Pell and 56 percent underrepresented minority students.
• Average median earnings were highest at Lower Access/Higher Earnings institutions at $70,536. Seventeen percent of four-year institutions fell in this category. As lower access institutions, four-year institutions in this category were on average 22 percent Pell and 28 percent underrepresented minority students.
• The Higher Access/Lower Earning group, where institutions have on average 49 percent Pell and 50 percent underrepresented minority students, average median earnings were $32,792.

Table 2: SAEC Categories at Four-Year Colleges and Universities

The SAEC provides useful information to college-going students, but it’s important to note a caveat: the earnings data included reflects a pooled cohort of students who entered the institution, regardless of whether or not they graduated. An Urban Institute analysis found that when looking at the earnings of an entry cohort versus a cohort of students who graduated from an institution, the earnings of the latter group are generally higher.

In our work (through the American Talent Initiative and other projects), we refer to high graduation rate institutions as institutions that consistently graduate at least 70 percent of their students. There are about 360 schools in the country that meet that criteria.

These institutions largely boast that their graduates have high earnings, which follows logically (institutions that have the resources to obtain a high graduation rate often have the resources to set students up for post-graduation success and often enroll relatively affluent and academically-prepared students). However, these institutions are unfortunately largely concentrated in the “lower access” categories, reflecting relatively low Pell and underrepresented minority student enrollment. Eighty-five percent of all high-graduation rate institutions fell in the Lower Access/Higher Earnings or Lower Access/Medium Earnings categories.

However, 27 of the high graduation rate schools are identified as “Opportunity Colleges and Universities,” reflecting high access and high earnings. This includes George Mason University, Spelman College, and the University of Central Florida. With this high graduation rate consideration added in, these institutions should be lauded as field leaders in fostering student success, in the classroom and in the workforce.

The Student Access and Earnings Classification aims to promote collaboration and research within the field to advance solutions for increasing access to higher education and improving financial outcomes for students. We look forward to exploring the classification further and sharing additional insights.

^[1] Refer to the Student Access and Earnings Classification Technical Manual for more information on the methodologies used to obtain the access and earnings measures.

^[2] Underrepresented minority students include students who identified as American Indian/Alaska Native, Black or African American, Hispanic or Latino, Native Hawaiian or Other Pacific Islander, or Two or More Races. Excludes US nonresidents.

^[3] 667 four-year institutions were not classified in SAEC due to insufficient enrollment and/or regional data.

^[4] American Community Survey, US Census Bureau. These figures reflect the median earnings of full-time, year-round workers aged 25-34 in 2022.