If your degree does not pay enough, you cannot borrow federal money for it. That is the new rule out of the Education Department, and it is already sending shockwaves through programs like social work, cosmetology, and the arts.
Starting July 1, 2027, undergraduate programs have to prove their median graduate earns more than 25 to 34 year olds with only a high school diploma, measured by IRS data four years after graduation. Fail the earnings test in two out of three consecutive years and the program loses access to federal Direct Loans for at least two years.
The programs expected to take the biggest hit: social work, art, religious studies, teaching aide programs, music, and cosmetology certificates. The department estimates about 3 percent of programs at public and nonprofit schools could fail, but roughly a third of programs at for-profit colleges are in the danger zone.
Critics are already warning the rule could fall hardest on Black students and the communities they serve, cutting off the path into professions like social work that those communities lean on the most.
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