07/02/2013 03:26 pm ET Updated Sep 01, 2013

Lost Opportunity

There is a large minority in America, the size of which few are aware. It outnumbers Latinos and Baptists nationally, and it can claim more than one in five African Americans as members. In Utah and Alaska, it accounts for almost one third of the entire population.

Americans with "some college, no degree" (SCND), as the Census labels them, represent 16.7 percent of adults. These dropouts are outnumbered by college graduates, but not by as much as one might think. Forty-one percent of adults possess either an associate or a bachelor's degree, indicating that roughly one-third of those who entered higher education left without graduating.

How much college is "some college"? The majority of SCNDs (52 percent) completed two years or more. In other words, they were halfway there and quit with nothing except a load of debt. A New York Times story last December followed Angelica, a low-income girl accepted into Emory University. After more than three years and $61,000 in debt, Angelica was forced to leave Emory with no degree and returned home to a minimum-wage job. As with many Americans, her ambitious quest for a better life left her substantially worse off.

Angelica is not an outlier; outcomes for SCNDs tend to be uninspiring. Their wages are only slightly better than those of high school graduates but still worse than those of the average worker, and the same is true of their unemployment rates. Their life expectancies are approximately one year longer than those of high school graduates but still multiple years shorter than those with bachelor's or graduate degrees.

Yet there is an even smaller minority who spends less time in school and fares considerably better. The 9.7 percent of Americans with two-year associate degrees face almost two percentage points lower unemployment and make approximately $6,000 more per year than their un-graduated counterparts. These graduates of two-year programs are less ambitious from the start, matriculating into shorter programs at lower quality institutions. Yet with less time, less debt, and less education, they come out ahead.

Is this the right set of incentives: aim low to succeed? Does this seem fair? Four years may not be feasible for everyone, but those who come close ought not to walk away empty-handed. In this regard, there may be a lesson to be learned from the less prestigious end of the undergraduate spectrum.

A difference in coursework exists between the first and last two years of most bachelor's curricula, and community colleges take advantage of this distinction to forge two separate degrees. Academic associate programs at community colleges offer the same general education classes one would find in the first two years of a bachelor's. Candidates with weak high school transcripts can take advantage of these accessible programs to prove themselves for two years before transferring into a four-year institution to pursue studies concentrated in a discipline of interest. The bachelor's degree thus disintegrates into its component parts: a two-year associate's in liberal arts and a two-year bachelor's in a focus area.

The question thus arises: Why must one attend two different schools in order to have the benefit of this deconstructed degree? If the first two years of undergraduate education are different in scope from the last two years, why are these two segments not two separate degrees to begin with?

For educational institutions, four years of guaranteed tuition clearly beats two. Without an option to stop halfway through, students drop out only under the direst of circumstances.

For students, such an arrangement seems impossibly cruel. At Emory, Angelica suffered emotionally and financially with grades, distance from family, and insurmountable living expenses for three and a half years before she finally gave up. After walking away with no credential, her earning potential was no greater than before she attended. In fact, with substantial loans and the opportunity cost of three lost years, Angelica's situation was appreciably worse.

In a different world, Angelica could have walked away with an associate of arts from Emory. This degree would have been less prestigious than a bachelor's, but it would have provided her a credential with which she could have found better work at a higher wage to help pay off her loans. The Emory name would have appeared on her resume, giving her pride in her accomplishment and leverage in her dealings with employers. She could have gracefully exited college, and her story could have ended on a happier note.

Ph.D. programs have already learned this lesson. Five or more years are often too many for a candidate to endure, and so programs often allow students to leave with a master's. This outcome provides some compensation for the invested time and effort and thereby reduces the student's bitterness. It also provides a credential on which to build a career.

Universities can learn the same lesson at the undergraduate level, and for free. Issuing an associate degree costs nothing and could represent considerable savings for the school when one factors in the cost of supporting a failing student through an additional two years of schooling. Teachers, administrators, and counselors lose time and energy in so doing, and unwilling participants contribute to a negative classroom atmosphere. This is not to say that schools should merely give up on those who struggle, but there comes a point when allowing a student to move on is the best option.

In this way, schools could shed some of their poor admissions decisions while at the same time, delivering value to those misplaced individuals in the form of a credential. Such exits might also open up additional spots for ambitious transfers who had already proven themselves academically at other universities.

One can even imagine a world where the two degrees become entirely disassociated. Such a solution might, in fact, be the most efficient. If a student attends Northwestern for their associate's and decides to focus on marine biology, it might behoove him or her to reapply to UC San Diego for their bachelor's. This principle carried to its logical conclusion might drive universities to specialize in a more limited set of subjects. Why should every university bear the burden of housing a comprehensive set of academic departments? Allowing students to move to universities more relevant to their interests would alleviate the burden of having to provide deep offerings in any number of majors a student might choose. Universities could thus find themselves able to hone a few areas of deep focus, ushering in a new age of specialized intellectual thoroughness.