WASHINGTON, D.C. — The U.S. Department of Education has unveiled a new earnings indicator designed to give prospective college students and their families clearer information about graduates’ financial outcomes as part of the Free Application for Federal Student Aid (FAFSA) process.

According to the Department, the feature uses existing federal data to show whether an institution’s graduates typically earn less than the average high school graduate. When that occurs, the FAFSA form will display a “lower earnings” disclosure tied to the selected institution. Officials say the goal is to provide additional transparency as families evaluate the cost and value of different postsecondary options.

Education Secretary Linda McMahon said the tool is meant to address growing public concern about the cost of higher education and long-term debt burdens. “Families deserve a clearer picture of how postsecondary education connects to real-world earnings,” McMahon said, adding that the indicator is intended to make data more accessible rather than to steer students away from specific schools.

Federal data cited in the release show that more than 2 percent of undergraduates attend institutions where median graduate earnings fall below that of a high school completer, despite those schools receiving over $2 billion annually in federal aid.

The earnings indicator is one component of a larger federal effort to increase transparency around student outcomes. The Department emphasized that earnings are only one factor students should weigh, alongside cost, academic programs, location, and personal goals. Updated data supporting the new indicator has been posted to the Federal Student Aid Data Center, and the metric will be refreshed as newer earnings information becomes available through the College Scorecard.

Education officials also said counselors and college-access organizations may use the information to help guide students through the decision-making process.

The Department’s press office said additional details can be found through the Under Secretary of Education Kent’s Homeroom Blog, Federal Student Aid’s Electronic Announcement, and the FSA Data Center.