Federal Reserve Bank Says Don't Go To Community College

Well, methinks the community colleges of America will be having a cow about now.

Yesterday, education reporter Mary Beth Marklein of USA Today announced a study that finds a Two-year ‘penalty’ if a student starts his or her higher education in a community college. The study, produced by the Federal Reserve Bank of St. Louis, indicates that students who start their education at a two-year college make somewhat less than their counterparts who start at a four-year college or university.

Interesting. Except that it’s not.

Does it really inform a particular individual’s decision about whether to start at a two-year school if as a group community college folks make less?

What about the price differential between the cost of a two year college and the cost of a four year college? If I invested the difference, would I have come out better than those who started at a four-year program?

These are nice statistics. But I envision that some parents will interpret them as a reason to prevent their student from attending a community college.

Sadly, this is exactly what the author of the study hopes: that students will think twice about attending a community college, because they will make less in the long run.

But remember folks, YOU (and your son or daughter) are not statistics. They are individuals. The averages may or may not apply to your son or daughter.

Plus, this study says nothing about the fact that there are many, many students who perhaps started at a community college because their grades in high school were low, or family finances were such that a four-year college was not an option immediately out of high school.

What if those same people who show up in the statistics were NOT to go to college?

Plus (I’m on a roll…), the average of the four-year colleges is across the entire higher education system. It is NOT true that any four-year degree is equivalent to any other.

I do not quarrel with the general principle that in the aggregate, all people who started with at a four-year college make somewhat more than those who started at a two-year college.

I also do not quarrel with the principle that (in the aggregate) those with a BA make more than those without them.

But your child (or mine) could easily make much more or much less than any of these aggregate averages.

Statistics are not determinants in individual cases. Students who start at a community college are not doomed to make less than their peers at four year colleges.

Am I wrong to believe in the power of the individual and the existence of personal will?

So, while I am appreciative of the information this study provides, we should use the data carefully. It should not, despite the wishes of the author to the contrary, be used to guide an individual’s decisions about their educational or professional future.

Mark Montgomery
Educational Consultant

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Published by Mark Montgomery

Mark is a leading educational consultant. His experience as a professor, college administrator, and youth mentor help him guide students from around the country and around the world.

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  1. What does guide students seeking college advice about community colleges?

    I’ve noticed that the colleges themselves are dishonest about many facets of the differences between 2 and 4 year institutions including:

    – Cost
    – Type of student attending
    – Ability to transfer credits

    What, in your opinion are the reasons students should attend a 2 year institution?

  2. Hi, Mark.

    I’m not sure which colleges are dishonest in reporting what is different between 2 and 4-year colleges. Certainly there are differences. But there are also wide variations between 2-year colleges–just as there are differences among 4-year colleges.

    I also would never say that all students should consider community colleges. It depends too much on the needs, abilities, and aspirations of the particular student.

    So if money is a big consideration, a community college might be a good place to start. For students who must live at home and take care of family and take only a few credits at a time, a community college may be a good place to start. Students who want to try college but who have a GPA that is too low to get them into a four-year institution will probably have to start at a community college. Gifted and talented students in rural areas may have more opportunities at the local community college than at their high school..so they may end up with an AA and a high school diploma at about the same time. Other talented students who want to do some dual enrollment options and get credit for college and for high school at the same time might consider a community college course or two.

    There are lots of reasons to consider a community college. But it really depends on the student…I try to avoid making blanket statements about “should” and “should not” until I have a chance to really get to know a student.

    Hope that helps, Mark. Thanks for dropping by again!

  3. Thanks Mark! This is an interesting topic given that roughly half of our collegebound seniors will be considering community college in the Fall. After reading the complete Fed report http://stlouisfed.org/community/assets/pdf/CommunityColleges.pdf, I dont think that the “author of the study hopes: that students will think twice about attending a community college, because they will make less in the long run.” In the broader discussion, she is emphasizing the role of community colleges as “vehicles of upward economic mobility.”

    I absolutely agree with you and I think that the Fed Study reinforces your point that, while the research holds true universally, it is not necessarily true of an individual student.

    After reading the coverage in USA Today and your recent posts, I took a moment to analyze the bigger picture in the Fed Report. My thoughts can be found here:

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