Closing the Postsecondary Attainment Gap: Midwestern Competitiveness in a Global Economy

The United States is losing ground to other countries in the proportion of its workforce that possesses a college degree. Given the relationship between educational level, employment and growth, the rising credentials gap threatens the future economic competitiveness of our nation. President Obama has expressed a commitment to ensuring that our nation will once again lead the world in having the highest proportion of students graduating from college by the year 2020. According to the State Higher Education Executive Officers, in order to maintain pace with top performing countries the United States will need to produce a projected 15 million additional postsecondary degrees and other credentials by 2025.

The Effectiveness and Efficiency of Postsecondary Institutions

Graduation rates are frequently employed in rating the effectiveness and efficiency of colleges and universities. However, variation in raw graduation rates may better reflect differences in such factors as admissions selectivity or institutional mission rather than whether institutional practices and programs are conducive to student success. This report thus estimates institutional effectiveness as the difference between an institution’s actual graduation rate and the rate that would be expected given the institution’s structural attributes, the types of students served, and the geographical context. Institutional efficiency is then estimated as the ratio of effectiveness to educational expenditures per full-time equivalent student. The results demonstrate that seemingly low graduation rates may in fact reflect institutional practices that are satisfactory or better.