New Federal Law Bars Federal Loans for College Programs Whose Graduates Earn Below High-School Median Wage

A new federal law effective this month requires every U.S. college, university and short-term certificate program to show that its graduates earn at least the median wage of high school diploma holders in the same state. CalMatters reported that programs failing the test will render their students ineligible for federal loans.

In California the median wage for workers with only a high school diploma stands at roughly $18 an hour, or $36,000 a year. Roughly 300 California programs are projected to miss the mark, including many cosmetology programs and some arts programs. Michael Itzkowitz, president of the HEA Group, described the standard as a low bar.

“If you’re going to college, you expect to be earning at least minimum wage, and probably even more than that,” Itzkowitz said. In the Bay Area, $36,000 a year covers little beyond basic housing costs.