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The College Dropout Problem May Not Be as Bad as the Government Says

In calculating college completion rates, the Department of Education may be undercounting students who start at one school and graduate from another

Almost 41 percent of students who start college won’t finish, according to the U.S. Department of Education. The data is grim—but it could also be unnecessarily pessimistic. A new report suggests the government may be over-counting dropout rates because it doesn’t account for a big, but hard-to-track, group of students: the ones who transfer midway through college.

For a report (PDF) released on Tuesday, the National Student Clearinghouse Research Center looked at state-level data on enrollment and graduation patterns for nearly 2.7 million students who were freshmen in 2008. Its aim was to reveal a flaw in the way the Education Department reports dropout rates. To see whether students graduated, the researchers looked at those who matriculated at a college and then checked to see whether, within six years, they had graduated from that college. That excludes anyone who transfers—almost a quarter of all college students.

When the center looked only at students who graduated from the school they first enrolled in, it found the college completion rate was 42.1 percent. When it factored in students who enrolled but graduated from a different school, the college completion rate jumped to 55.03 percent. While the center’s data set is different from that of the Education Department, you can extrapolate from its findings that counting transfer students would make the government’s completion levels jump, too.

By the same logic, the center’s data suggest fewer students may be dropping out after their first year than government officials think. When the researchers didn’t count students who transferred and completed college elsewhere, the “non-persistence rate”—as the report identifies the share of freshmen who don’t return for a second year of school—rose by at least 20 percent for almost every state in the country. “Tracking students who started college in one state and completed in another substantially added to the overall completion rate for students who started at four-year public and four-year private nonprofit institutions,” according to the report.

So things might not be as bad as they seem. More students graduate college, and fewer than we think drop out early. Yet there’s room for improvement: Even a hypothetical 55 percent college completion rate would still leave 45 percent of U.S. students without a college degree—and the salary and career benefits that come with it.