U.S. law requires colleges to prove graduates earn more than $36,000

Effective this month, a new federal law mandates that all U.S. colleges, universities and short‑term certificate programs demonstrate that their graduates earn at least the median wage of a high‑school‑only worker in their state. If they cannot meet the standard, students risk losing eligibility for federal student loans.

Analysts estimate that roughly 300 programs in California – notably many cosmetology, medical‑assistant, arts and theatre programs – fall short of the $36,000 annual earnings benchmark within four years of graduation. While about 90% of the state’s nearly 3,000 programs meet the threshold, the failing cohort includes for‑profit trade schools as well as community‑college and university courses, such as theatre and fine arts at several California State University and University of California campuses. Schools have two more years to provide proof of compliance; continued non‑performance could trigger loss of loan access as early as July 1, 2028.

Michael Itzkowitz, president of the HEA Group, described the requirement as a “low bar,” noting that “if you’re going to college, you expect to be earning at least minimum wage, and probably even more than that.” The average Californian currently earns about $18 an hour ($36,000 a year), barely covering living costs in high‑cost areas like the Bay Area.