By Bill Hardgrave
To save you some time, I will jump directly to the conclusion: higher education has always provided (and still provides) a positive return on investment. But you should also know, I am biased. As a university president, I am bullish on higher education. If I weren’t, you should be questioning my judgment. As a first-generation college student, I am living proof of the value of higher education. Simply, and quite obviously, without a college degree, I would not be a college president. With my stated biases out of the way, let’s explore the value proposition of higher education.
Some facts supporting the value proposition*:
- Those with a bachelor’s degree earn $9,000 more per year than those with a high school diploma.
- Households headed by bachelor’s degree holders make $132,700 per year compared to $58,410 for households headed by high school diploma holders.
- And the former household’s real income (when adjusting for inflation) increased 13% in the past 20 years, while the latter was flat during the same time period. Thus, the gap is wide and getting wider.
- Unemployment for new college grads age 22-27: 4.8%. Unemployment for all workers age 22-27: 7.4%.
- From 2024-2032, it is estimated that 18.4 million workers in the US with college degrees will retire. During this same time period, we will produce 4.5 million fewer workers with college degrees needed to fill the gap. Especially hard hit: accountants, attorneys, doctors, engineers, managers, nurses and teachers.
- 73% of employers say a college degree is worth the investment because it produces better workers.
Indicators of issues*:
- In 2013, 53% of Americans believed that a college education was worth it. By 2025, this had dropped to 33%. The primary reason stated for the drop — cost.
- Only 42% of Americans have high confidence in higher education.
- Currently, only 42% of eligible high school graduates pursue a four-year degree. This is down from 46% in 2022.
Clearly, something is amiss when the data shows the value of a college degree, yet only a third believe it is worth it. I believe it all comes down to costs (relative to value) and outcomes.
Let’s start with the cost. Current headlines would lead you to believe that the ‘negative’ view of the value of higher education is a new phenomenon. On the contrary, this narrative has been around for more than 50 years. After eight million veterans took advantage of the GI Bill following World War II (when it was originally estimated that only 800,000 would use it), economists feared that too many people were getting degrees and their long-term wages would suffer. A New York Times headline in 1975 declared that a college degree had lost its edge for degree holders. As we know, this was not the reality, as wage premiums soared in the 1970s and have only gone up since.
In the U.S., we didn’t start charging tuition until the late 1960s and early 1970s in most cases. Until then, a college degree was essentially ‘free’ for the student. Declining support from the state and federal government, coupled with easy access to student loans, led universities to charge tuition. State support continued to decline and was replaced by raising tuition. For many who were not familiar with the decline in state support, it felt like colleges were raising tuition because they were greedy. In reality, most tuition increases were to offset the loss of state support. After several years of increasing tuition, the rate of increase has decreased significantly. In fact, when accounting for inflation and financial aid, the real cost of a college degree has been flat for years.
Costs, however, are relative to the benefits — in this case, the outcomes. A college degree is an investment, and the payback should be positive.
The reality is that most college graduates will start at a much lower level, working for a company that may not be their first choice in a location that may not be ideal.
But as I often tell graduating students, your first job is your first job. It likely won’t be your last job, and it likely won’t be your best job. Get started, do great things and you will grow professionally.
Impatience also plays a role in the unrealistic expectations of today’s students. Some students expect to start at a much higher level in an organization than what is realistic for a new college graduate. Third, universities started lowering their admissions requirements (i.e., they admitted underprepared students) for a variety of reasons. When this happens, students are likely to drop out. When they drop out, the costs of going to college are just that — they are costs, with little or no return on the investment. For the underprepared student who does make it to graduation, usually by struggling and barely making the grades needed to stay in school, they are unlikely to find a good job in their field. Of course, when this happens, the ROI is small or nonexistent.
Fourth, the recent refrain of “AI will replace college graduates” has had a chilling impact. This seems to be more media-driven hysteria. History would suggest that technological advancements are beneficial to the workforce. Throughout history, we have seen similar headlines: “the Internet will replace …”, “tractors will replace …”, “automobiles will replace …” – yet, in each of these cases, some jobs were impacted, but many higher-paying jobs were created. I believe we will see the same thing in the “AI economy,” and a college degree will be more valuable than ever.
Lastly, universities have not done a good job of ensuring positive outcomes for their graduates. A positive outcome is one in which a graduate finds a good job in their field or goes on to graduate or professional school. We are seeing an increasing number of universities change their curriculum to align with workforce needs. The University of Memphis is one such university, but much more of this is needed.
What universities need to do to ensure a good ROI for students:
- Admit students who can be successful in college and provide pathways to prepare those students who are not yet ready.
- Offer programs that lead to good outcomes.
- Align programs with workforce needs; be agile and flexible with industry needs.
- Be operationally efficient.
- Stay focused on why universities exist, which is to educate students and focus on their success. When students are successful, universities will be successful.
The value of higher education will, and should, continue to be questioned. All of us in higher education should be willing and able to show the value. Admittedly, over the past decade, many in higher education have missed the mark in failing to demonstrate the value. However, recognizing the importance placed on ROI by prospective students and their parents is driving change. What drew me to the University of Memphis was recognizing that this higher education institution was doing or capable of doing all the things needed to ensure a good ROI for students.
As I stated earlier, I didn’t come from a long line of college graduates. I know the value of a college degree; it was the foundation of my professional success. I get it, though — college isn’t for everyone. But, for those who want to go and have the capability, evidence would suggest it is worth it. While talking with students on my daily walks around campus, I am reminded of why higher education isn’t just important; it is critical for our future generations.
Suggested readings:
AAC&U Report. (2026). “The agility imperative: How employers view preparation for an uncertain future,” https://www.aacu.org/research/the-agility-imperative
Donadel, Alcino. (January 12, 2026). “Despite debt, completing college is worth its value,” University Business, https://universitybusiness.com/despite-debt-completing-college-is-worth-its-value/
Kamisar, Ben. (November 28, 2025). “Poll: In a dramatic shift, Americans no longer see four-year college degrees as worth the cost,” NBC News, https://www.nbcnews.com/politics/politics-news/poll-dramatic-shift-americans-no-longer-see-four-year-college-degrees-rcna243672
Perez, Jr., Juan. (December 1, 2025). “Why Americans say college isn’t worth the cost,” Politico, https://www.politico.com/newsletters/weekly-education/2025/12/01/why-americans-say-college-isnt-worth-the-cost-00671162
Roos, David. (January 6, 2026). “Why many US colleges were once tuition-free,” History, https://www.history.com/articles/american-colleges-tuition-free
Schneider, Mark. (January 14, 2026). “Colleges didn’t only lose their value – they lost their way,” AEI, https://www.aei.org/education/colleges-didnt-only-lose-their-value-they-lost-their-way/
Smith, Nicole; Van Der Werf, Martin; Adelson, Madeleine; and Strohl, Jeff. (September 16, 2025). “Falling behind: How skills shortages threaten future jobs,” Center on Education and The Workforce, Georgetown University,https://cew.georgetown.edu/cew-reports/skills-shortages/
Weisberg, Nate. (November 2, 2025). “No, college degrees aren’t losing their value,” Washington Monthly, https://washingtonmonthly.com/2025/11/02/no-college-degrees-arent-losing-their-value/
Zhang, Guangli; Jabbari, Jason; Despard, Mathieu; Mei, Xueying; Chun, Yung; and Roll, Stephen. (November 3, 2025). “College is still worth it, even with student debt, but we can do better,” Brookings, https://www.brookings.edu/articles/college-is-still-worth-it-even-with-student-debt-but-we-can-do-better/
