We advise institutions to seek counsel for strategic planning if they are concerned with compliance.
On December 31, 2024, the U.S. Department of Education officially released state and nationwide earnings threshold rates for its newly effective final rule on financial value transparency and gainful employment. The final rule was published on October 10, 2023, and established the earnings premium (EP) metric. The EP metric measures the extent to which the typical graduate of a program outearns the typical individual with a high school diploma or equivalent. All gainful employment programs (and all Title IV participating institutions subject to further transparency requirements) should closely review the 2024 rates (provided below) in order to predict compliance with the new requirements. We advise institutions to seek counsel for strategic planning if they are concerned with compliance.
Institutions are required to report institution- and student-level information on January 15, 2025. It is additionally noted that two currently pending lawsuits against the Department are seeking to invalidate the financial value transparency and gainful employment final rules.
EP Measure Breakdown
The EP is computed as the difference between annual earnings and the earnings threshold (ET)―further defined below―as follows:
Earnings Premium = Annual Earnings – Earnings Threshold
The metric compares the median annual earnings of Title IV recipients who completed the program after three years to the median earnings of high school graduates. The ET is computed as the median annual earnings among respondents aged 25-34 in the American Community Survey (ACS) who have a high school diploma or GED but no postsecondary education and who are in the labor force when they are interviewed, indicated by working or looking for and being available to work. The data is based upon information from the state where the institution is located or nationally if less than 50 percent of the students in the program are in the state where the institution is located while enrolled.
EP State and Nationwide Rates
The median earnings provided below indicate the ET for states (and the nationwide average), which applies to EP calculations for 2024.
|
State |
Median Earnings |
State |
Median Earnings |
|
Alabama |
$27,836 |
Montana |
$30,058 |
|
Alaska |
$35,457 |
Nebraska |
$31,316 |
|
Arizona |
$32,284 |
Nevada |
$33,172 |
|
Arkansas |
$28,502 |
New Hampshire |
$37,850 |
|
California |
$32,476 |
New Jersey |
$32,832 |
|
Colorado |
$35,571 |
New Mexico |
$27,836 |
|
Connecticut |
$33,286 |
New York |
$30,793 |
|
Delaware |
$31,316 |
North Carolina |
$29,344 |
|
District of Columbia |
$32,592 |
North Dakota |
$34,203 |
|
Florida |
$29,609 |
Ohio |
$30,793 |
|
Georgia |
$29,609 |
Oklahoma |
$29,810 |
|
Hawaii |
$34,203 |
Oregon |
$31,695 |
|
Idaho |
$33,397 |
Pennsylvania |
$31,727 |
|
Illinois |
$30,793 |
Rhode Island |
$34,203 |
|
Indiana |
$31,316 |
South Carolina |
$30,156 |
|
Iowa |
$34,203 |
South Dakota |
$31,385 |
|
Kansas |
$30,782 |
Tennessee |
$29,609 |
|
Kentucky |
$28,996 |
Texas |
$31,171 |
|
Louisiana |
$28,996 |
Utah |
$34,795 |
|
Maine |
$32,311 |
Vermont |
$33,397 |
|
Maryland |
$33,397 |
Virginia |
$33,043 |
|
Massachusetts |
$35,438 |
Washington |
$35,027 |
|
Michigan |
$28,996 |
West Virginia |
$28,996 |
|
Minnesota |
$34,795 |
Wisconsin |
$33,397 |
|
Mississippi |
$27,362 |
Wyoming |
$36,480 |
|
Missouri |
$30,156 |
United States (national earnings threshold) |
$31,269 |
For More Information
If you have any questions about this Alert, please contact any of the attorneys in our Higher Education Group or the attorney in the firm with whom you are regularly in contact.
Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.