Most Undergraduate Programs Clear New Federal Earnings Test, IHEP Analysis Finds

The median earnings of 93% of undergraduate programs exceed the new federal earnings-premium standard enacted under the One Big Beautiful Bill Act (OB3), according to When Purpose Meets Payoff, a report the Institute for Higher Education Policy (IHEP) released October 5. Those programs enroll 88% of graduates.

IHEP analyzed 42,392 Title IV undergraduate programs with valid College Scorecard earnings data, comparing graduates' median earnings four years after completion against two benchmarks: the OB3 threshold—the median earnings of high school graduates—and a stricter “Threshold 0,” which adds enough earnings to recoup a credential's net price within 10 years. Most programs passed that higher bar too, at 82%.

Results varied by credential and sector. More than 99% of bachelor's graduates and 96% of associate's recipients attended programs that cleared the OB3 threshold, compared with 55% of certificate holders. Certificate programs produced 24% of all graduates but 91% of graduates at failing programs; for-profit programs enrolled 35% of graduates but accounted for 85% of those at failing programs.

For Institutional Research and Effectiveness (IR/IE) offices, the findings preview how program-level earnings data could shape federal loan eligibility as the U.S. Department of Education implements the Student Tuition and Transparency System (STATS). The report also found affordability gaps in high-social-value fields: among Human Development and Family Studies credentials, only 27% of certificate and 61% of associate's recipients attended programs passing OB3. IHEP recommends enacting the College Transparency Act and restoring federal postsecondary data collections to help track program value.