A significant development came out of the US Department of Education yesterday that will impact our sector and schools. Beginning December 7, the FAFSA form now indicates which institutions of higher education have graduates with “lower earnings” compared to the earnings of high school graduates. A Department spreadsheet lists each of the lower earning institutions. The Department states that the lower earnings indicator is informational only and has no impact on Title IV eligibility or participation. The Department determined an institution is lower earning if the institution’s undergraduate completer median earnings, four years after graduation, are less than the median earnings of high school graduates (ages 25-34) in the same state. If the institution has locations in multiple states or if most of the first-year undergraduate students are from out of state, the Department will compare the institution’s completer median earnings to those of high school graduates nationally, instead. Virtually all institutions are included within the scope of the lower earnings indicator, with exceptions for those located in certain US territories, those offering exclusively graduate-level credentials, and those with no published median earnings data for the applicable years. The lower earning indicator will only be shown to first-year undergraduate students following submission of the FAFSA. The indicator reads “Some of Your Selected Schools Show Lower Earnings.” Students are then given the option to view charts showing their selected institutions’ completer median earnings compared to the applicable high school graduate earnings, with lower earning institutions displayed in red. A trashcan icon next to the word “Remove” appears alongside each lower earnings institution chart. Clicking on the trashcan deletes that institution from the student’s list of FAFSA selected schools. The median earnings for each institution are calculated based on College Scorecard earnings data for undergraduate completers during 2014-15 and 2015-16 (measured in 2019 and 2020). To account for inflation, these earnings are adjusted to June 2025 dollars. The median earnings for high school graduates are calculated based on the American Community Survey 5-year estimates from 2019 and 2020, also adjusted to June 2025 dollars. The Department indicated the agency will continue to update the lower earnings indicator as more recent earnings data becomes available. The lower earnings indicator differs in several key ways from similar accountability metrics under the FVT/GE Rule and the new Do No Harm framework under OB3. Most notably, the lower earnings indicator is calculated at the institution level, rather than the program level. Additionally, unlike other accountability metrics, the lower earnings indicator applies only to undergraduate programs. AACS will continue to monitor this issue for our members, especially as ED begins its work this week on the AHEAD negotiated rulemaking to determine how it will approach institutional accountability frameworks for FVT/GE and Do No Harm. | 
