NEW YORK (MainStreet) – The sky-high cost of attending college these days may make people wonder whether it’s worth the cash, and some college students, faced with mounting student loans, might even consider dropping out before their degrees are completed. But they may want to take a second look at the salary they would forfeit in doing so.
An analysis by the American Institutes for Research, a nonprofit research organization, looked at 1.1 million students who had begun college in 2002. Nearly 500,000 of them (more than 40%) did not complete a degree within six years – a decision which cost them a combined $3.8 billion in lost salary in 2010 alone. That comes out to an average of around $7,700 per dropout.
Of course, that’s just one class of students, which means that the total cost of dropping out of school is much higher.
“These findings represent just one year and one graduating class,” noted AIR’s Mark Schneider, who co-authored the report. “Therefore, the overall costs of low graduation rates are much higher since these losses accumulate year after year.”
Of course, it’s not just the dropouts who pay the price for failing to get their degrees. In addition to the $3.8 billion in lost wages, there’s also the $566 million that these graduates would have paid in taxes. That brings the total cost to the economy of just one class of dropouts to $4.5 billion in 2010 alone. New York and California paid a particularly high price, losing $24 million and $21 million, respectively, in tax revenue.
Is the high cost of college making you think twice about getting a degree? Check out MainStreet’s look at the 10 schools that give the most financial aid!