ADHE Performance Funding System Report - Arkansas Department ...

The past three years of economic turmoil have made many Americans question where they should
invest for their future. Today, passbook savings provide little return. The volatile stock market has
sapped many 401(k)s and the safe harbor of homeownership has vanished in a sea of over-extensions
and foreclosures. One investment, however, is never questioned: higher education. While some argue
that college graduates earn 84% more over their lifetime than their high school-educated counterparts,
and others argue the real additional economic value is 74%, no one claims there is not a significant
financial return on the investment in a college education. “On average, a four-year degree is the
equivalent of an investment that returns 15.2% a year. That’s more than double the average return to
stock market investments since the 1950s, which average 6.8%; more than five times the return to
investments in corporate bonds, which return
2.9%; gold at 2.3%, long-term government
Median Lifetime Earnings by Highest Educational Attainment, 2009 Dollars
bonds at 2.2% and housing at 0.4%.” (College
Planning, June 2011)
The data are clear that with each increasing
level of postsecondary education from the
certificate to the doctoral degree there is a
corresponding increase in lifetime financial
earnings. While these earnings are most often
measured in terms of dollars, earnings also
accrue in job satisfaction, career
advancement, job attainment and a host of
other job-related benefits.
While the economic returns of post-secondary
education are important, there are a host of
social and personal advantages a college
degree brings to almost every aspect of our
lives. College graduates are healthier, live
Source: “The College Payoff; Education, Occupations, Lifetime Earnings;” Georgetown
University Center on Education and the Workforce
longer, have more stable family lives, and contribute greatly to their communities. College graduates
are significantly less likely to commit crimes and more likely to participate in the civic life of their
community. With the economic, social and personal advantages a college education promotes, it is not
at all surprising that college graduates are much more likely to say they are “very happy” than are their
high school graduate counterparts. Gov. Beebe’s goal for Arkansas is worthwhile for so many reasons;
however, none is more important than the fact that education simply makes life better - better for the
individual, better for the family and better for the community.
For these and many other reasons, the institutions of higher education are strongly united behind the
Governor’s goal of doubling the number of graduates in Arkansas by 2025. Educational achievement is
the pathway to prosperity for all Arkansans. Act 1203 of 2011 will help achieve this dream. While this
Act and our goal focus on numbers, we cannot let our ambitions for quantity in any way reduce the
commitment to quality that has characterized Arkansas higher education. This commitment was
recognized in Act 1203 which encouraged steps to “promote degree production while maintaining a high
level of rigor” and by requiring higher education institutions to “address institutional accountability for
the quality of instruction.” Lasting educational improvement results from the collaborative efforts of all
citizens of the state working together to increase the number of graduates. But increasing the number
of graduates must be done while maintaining the quality educational experience necessary for success
as Arkansas citizens and members of the global community.
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