Exploring the Growth of Master’s Degree Programs in the United States
Declining numbers of undergraduate students have been a concern for the vast majority of higher education institutions since the Great Recession. Colleges experienced a 15 percent decline in undergraduate enrollment between 2010 and 2021. These enrollment losses have led many institutions to turn to growing their numbers of graduate and professional students in order to stabilize their budgets. During the same period, graduate enrollment increased by nine percent. Most of this growth in graduate enrollment has been in master’s degrees, which make up more than eight in ten graduate degrees awarded.
This growth in master’s degree enrollment is driven by a combination of institutions starting graduate programs for the first time and institutions expanding upon their suite of existing programs. It is important to understand the characteristics of these new master’s degree programs because while adults with a master’s degree earn an average of $14,000 more per year than individuals with a bachelor’s degree, it is increasingly clear that not all programs pay off for students or taxpayers. New data show that some programs leave students with high debt burdens relative to their earnings after completing a master’s degree, and taxpayers provide substantial subsidies to graduate student borrowers through income-driven repayment programs. Graduate students represent only 21 percent of all students in higher education, but represent 47 percent of all federal student loans disbursed in the 2021–22 academic year.
The costs and benefits of graduate education have been hotly debated in recent years, resulting in recent policy debates around gainful employment, financial transparency, Grad PLUS loans, and student loan repayment. As a result, a better understanding of the growth of master’s degree programs can help policymakers evaluate and forecast impacts on accountability, access, and equity in graduate education. We are particularly concerned about the ability of students from historically underrepresented groups to access high-quality degrees, as Black students and programs with more Black students tend to have a lower return on investment amid labor market discrimination.
To summarize our key findings, we find a steady rise in the number of master’s degree programs, particularly among private nonprofit universities and in health sciences programs. Online and hybrid programs have been growing more quickly than in-person programs since well before the pandemic, and there are only modest differences in the diversity of graduates based on when their program was established.
