New Loan Rule Targets College Programs With Low Graduate Earnings

A new 'do no harm' provision in Republicans’ One Big Beautiful Bill Act will, starting in July, bar federal student loans for degree programs whose graduates earn less than typical high school graduates, potentially affecting about 2% of U.S. associate and bachelor’s programs and roughly 40,000 students, according to an analysis by the HEA Group. The rule compares median earnings four years after graduation to those of high school–only workers and will cut off loan access for programs that fail the test in two of three consecutive years. Higher‑education researchers say most programs, including the bulk of liberal‑arts majors, will clear the bar, but a disproportionate share of arts, religion and cosmetology programs and some specific majors — such as Brigham Young University’s dietetics and clinical nutrition services program, where grads earn about $18,300 annually, nearly $19,000 below high‑school peers — appear vulnerable. Senate Republicans framed the change as a way to stop federal loans from financing degrees that leave students 'worse off' than if they never went to college, while critics in the policy world are warning this is effectively a back‑door program‑level accountability system that could hit lower‑paying but socially valued fields. The move comes amid mounting public skepticism about rising tuition and $1.8 trillion in student debt, and will force colleges whose programs fall below the earnings threshold to either improve labor‑market outcomes or risk losing access to a core source of student financing.