What College Dropouts Cost Taxpayers: $9 Billion a Year

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Empty classroomEveryone knows how expensive it is to get a college education, but what about the cost of dropping out of college? A new report found that taxpayers foot a steep bill for college dropouts: more than $9 billion annually.

Finishing the First Lap: The Cost of First-Year Student Attrition in America's Four-Year Colleges and Universities, conducted by the nonprofit American Institutes for Research (AIR), set out to tally the costs associated with freshman students who don't return to the college where they initially enrolled.

Between 2003 and 2008, states appropriated almost $6.2 billion to colleges and universities to help educate students who didn't return for a second year. In addition, the states doled out $1.4 billion and the federal government spent more than $1.5 billion in grants to students who left school before their sophomore year, according to the analysis. California, New York and Texas led the nation in government spending on students who dropped out of college.

More Graduates Needed

Overall, more than 20% of full-time students who enroll in a four-year college won't be in school the following year, and 40% of students attending community colleges won't return for a second year, according to AIR.

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To address this problem, AIR and Matrix Knowledge Group have launched a new website, Collegemeasures.org, which allows consumers to evaluate the performance of the nation's four-year colleges.

President Obama has called for reducing high school and college dropout rates, and he has said that the future of America's prosperity relies on a better-educated workforce. At the first White House Summit on Community Colleges, held Oct. 6, the president called for federal funding for two-year community colleges as a way to boost the economy and get Americans back to work.

Community colleges will have to increase the number of degrees they confer by 5 million over the next 10 years, Obama said, to achieve his goal of retaking the world lead in the percentage of adults with a college degree by 2020. The U.S. now ranks 12th in the percentage of workers between the ages of 25 and 34 with associate's degrees, according to a July 2010 report by the College Board.
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