Arkansas higher‑education agency presents ROI analysis showing varied payback periods by program; agency will expand metrics to short‑term certificates

Commissioner Ken Morton of the Arkansas Division of Higher Education presented the agency’s method for measuring return on investment for postsecondary credentials and shared early results and next steps.

Morton said the agency compared graduates’ median post‑completion earnings to the cost of attendance and the wages those students forewent while enrolled to estimate a net return. The analysis used the state longitudinal data system, matched graduates’ records to unemployment insurance wage data for Arkansas, and limited the 2015 cohort to students the state could account for; students who left the state for work or who could not be matched were excluded from the calculations.

Morton said the analysis was performed at the two‑digit CIP (Classification of Instructional Programs) level to avoid small cell sizes and protect privacy. The agency used 2015 as a graduation year because the state’s longitudinal data are strongest from roughly 2011 onward; the analysis shows cumulative median earnings for up to eight years post‑completion and reports the number of years it takes for median earnings to “pay back” the cost of the credential.

Morton provided several examples from the agency’s slides: in one computer and information sciences category the agency estimated the associate degree paid back in about 1.86 years and the bachelor’s degree in 2.24 years; in that example the associate program’s estimated cost was roughly $40,000 and the bachelor’s roughly $100,000, with eight‑year median cumulative earnings for the bachelor’s example about $482,000. In education, Morton said an associate education credential did not, over eight years, exceed a high‑school graduate’s earnings once cost was counted, while a four‑year education degree paid for itself in about 4.42 years. For law‑enforcement and protective services, Morton said associate credentials paid back in about 1.15 years while bachelor’s credentials paid back in just under five years. For health professions, he said the associate credential paid off in about one year and the bachelor’s in about 2.34 years.

Morton emphasized these are median estimates based on in‑state employment and that longer horizons (years nine and 10) can change the relative returns for some bachelor’s degrees; he said other states’ results show four‑year liberal‑arts degrees can continue to grow in earnings after year eight. He also said the agency will expand measurement this year to include technical certificates and certificates of proficiency and will later include short‑term nondegree credentials.

Committee members asked how the results are or will be made available to prospective students and advisers. Morton said statute requires public colleges and universities to give an economic security report listing median salaries by degree and institution when a student applies; he said the report is publicly available through a state dashboard (he referenced the Arkansas Economic Security Report on the Department of Commerce site) and that the agency is working to make the metric more accessible and actionable to parents, students and school counselors.

Morton said the agency is collaborating with commerce through data‑sharing agreements: degree records come from the Arkansas Higher Education Information System and wage matches come from unemployment insurance wage data. He said the agency will continue to add cohorts and degrees, including private career schools for which the agency currently lacks comparable wage match data, and will embed a return‑on‑learning (RLI) metric in the funding formula as requested by the Access Act.

Members asked for more accessible presentation formats and for the agency to share the complete slide set. Morton said he would provide the additional materials to the committee.