CHICAGO Aspiring journalist Fruzsina Eordogh dropped out of Loyola University Chicago last spring, just a few classes shy of graduating.
Saddled with $50,000 in student loans, she decided that spending more time in class would derail her from pursuing opportunities in the job market.
Eordogh, now 26, has worked full-time since June as an online reporter at the Daily Dot, a digital publication covering Internet culture, and is chipping away at her financial obligations even as many of her former classmates have gone on to graduate school.
"I've never had a job in journalism that required me to show my diploma," says Eordogh, who has written for outlets ranging from AOL.com to True/Slant (now part of Forbes.com).
She is hardly unique.
There are some high-profile cases of dropouts-made-good like Bill Gates, Steve Jobs and Mark Zuckerberg, but the majority are not so fortunate. The United States has the highest dropout rate in the industrialized world, according to a Harvard analysis of data from the Organization for Economic Cooperation and Development.
The "Pathways to Prosperity" study by the Harvard Graduate School of Education in 2011 shows that just 56 percent of college students complete four-year degrees within six years. Only 29 percent of those who start two-year degrees finish them within three years.
The Harvard study's assertions are supported by data collected by the Organization for Economic Co-operation and Development for its report "Education at a Glance 2010." Among 18 countries tracked by the OECD, the United States finished last (46 percent) for the percentage of students who completed college once they started it. That puts the United States behind Japan (89 percent), and former Soviet-bloc states such as Slovakia (63 percent) and Poland (61 percent).
The failure to complete a college education in the United States is especially marked at four-year private for-profit schools, where 78 percent of attendees fail to get a diploma after six years, according to a 2011 report from the National Center for Education Statistics.
That compares with 35 percent of students in nonprofit private schools and 45 percent of students in public colleges who failed to graduate after six years.
REASONS FOR DROPPING OUT
Today's U.S. college dropouts are more likely to be male (57 percent of college degrees go to women), the Harvard study shows. They are less likely to be pursuing careers as lawyers, doctors or architects, where higher education has a clear correlation with obtaining a job.
Reasons for dropping out included: not being prepared for the rigors of academic work; inability to cope with the competing demands of study, family and jobs; and cost, the Harvard report says.
William C. Symonds, lead author of "Pathways to Prosperity says: "You will find a lot of kids with a four-year degree who do not have a clue as to what they'll do."
"For many young adults, the ultimate bottom line is whether the degree or credential they earn will help them secure a job," according to a 2011 Pew Research Center report, "Is College Worth It?"
A four-year private college education tripled in price between 1980 and 2010, the study finds, and student loan debt for a bachelor's degree now averages more than $23,000 per student borrower.
Many students approach the dropout decision as a simple cost-benefit analysis. They ask themselves whether leaving will put them financially ahead of where they'll be after amassing four years of student loan debt in a lukewarm job market.
DEGREE IS WRONG PATH, FOR SOME
Michael Nelson, 22, of Fayetteville, Georgia, "retired" from nearby LaGrange College during his freshman year. "I knew it wasn't going to take me where I wanted to go," he says. Now a gold and precious metals dealer, he made $85,000 in 2011.
"A lot of my friends are coming out of school with $50,000 in debt," Nelson says. "They don't know how they're going to survive because they don't have a job."
That doesn't mean that college is becoming a bad investment.
In 1973, 72 percent of the workforce had no college education, but by 2007, that number dropped to 41 percent, the Harvard study shows. College graduates earn $19,550 more a year on average than those with just a high school education, according to 2010 figures from the U.S. Census Bureau.
But in 2010, student loan debt also exceeded consumer credit card debt for the first time in history, according to estimates compiled by Mark Kantrowitz, the publisher of FinAid.org and Fastweb.com.
Financial barriers play a key role in students' decisions to drop out of college, the Pew study finds. Among adults age 18-34 who lack a bachelor's degree, two-thirds halted their education to support a family, 57 percent preferred to work and make money; and 48 percent simply couldn't afford college.
DROPPING OUT VS. DEBT BURDEN
Yet for some students, dropping out with loans can be worse than plowing through with debt. Student loans can't be discharged via bankruptcy, for example, and many college dropouts will face career barriers due to the lack of a degree, experts say. Current unemployment statistics show that those without a college degree are twice as likely to be unemployed as those with a bachelor's degree.
One way students and families can tilt the equation in their favor is to simply spend less, experts say.
"If students are more reasonable and selective about where they're going to get that degree, college costs are more manageable," says Eleanor Blayney with the Certified Financial Planner Board of Standards. "At the very least they can do the first two years at a community college and then transfer."
Both Eordogh and Nelson claim that the lack of diplomas hasn't hurt their prospects. She says she's making as much as her colleagues with degrees, and he points to his paid-off school loans and his new Volkswagen Jetta.
"Twenty years from now, if I decide to go to grad school, I'd get that paperwork done," Eordogh now says. "But otherwise, I'm not that interested."
For suggestions on how college students can avoid dropping out, see our latest Money Clip video, with Reuters Wealth editor Lauren Young, at link.reuters.com/bum27s
(The author is a Reuters contributor)
(Additional reporting by Heather Struck; Editing by Lauren Young and Andrea Evans; Desking by Andrew Hay)