Report: Declining College Degree Prospects For Low-Income Youths

Print More

In the coming years, low- and moderate-income youth will find it increasingly difficult to afford the cost of a college degree because of “inadequate” government grant aid and the rising price of higher education, according to the first annual report to Congress by the Advisory Committee on Student Financial Assistance.

The report, “The Rising Price of Inequality: How Inadequate Grant Aid Limits College Access and Persistence,” released by the congressionally chartered group under a legislative mandate, analyzed the adequacy of federal, state and institutional grant aid to assess college access and persistence rates for poorer students. The trends, the authors conclude, are not encouraging.

The price of public college has gone up compared with the amount of aid students can get to pursue a four-year degree and with the ability of families to pay the costs. This means that high school graduates who qualify for a four-year higher education program may defer enrollment simply because they cannot afford to go, or start at two-year colleges instead – where the rates of degree attainment are lower.

“Shifts in initial enrollment are consequential because where qualified high school graduates are able to start college (access) largely determines their likelihood of success (persistence),” the report said. These and other trends could take a “toll” on the number of bachelor’s degrees earned by low- and moderate-income students, according to the findings.

The report recommends several federal remedies to reverse the negative trends in enrollment and persistence rates, such as ensuring that states and public colleges hold Pell Grant recipients harmless against rises in tuition and other expenses through more state and institutional need-based grant aid.

“Shielding academically qualified low- and moderate-income students from rising public college prices is a national imperative,” the report said.

“We need to get back to a place where grants are the main way to pay for college for those who need them, not a small part of the mix,” said Edie Irons, spokeswoman for Oakland, Calif.-based Institute for College Access and Success.

Irons cited figures that show a federal Pell Grant – a needs-based grant for low-income students – covered 77 percent of a four-year college experience in the 1979-80 school year. Now, those grants cover just 34 percent of the cost of a four-year degree.

The report called the recent boost in Pell grants “encouraging,” but said these efforts must be “greatly intensified and broadened.”

 

More Student Aid Won’t Help

Others said increasing grant aid will not solve the problem.

“Just saying we need to raise grant aid is not a solution because that grant aid will just be eaten up in increases in tuition and prices,” said Neal McCluskey, a higher education analyst at the Washington, D.C.-based Cato Institute. “They charge as much as they can,” he said, and “aid is one of those things that enables them to charge more and more.”

Here is how much college costs rose last year. Several months ago, Jobs for the Future examined the difference between the price of college and the actual cost.

At a time when labor economists predict a growing demand for post-secondary degrees, the trends pointing to lower college persistence rates deal a sobering blow to the prospects of the American higher education system’s ability to prepare youths to meet that demand. The findings cast a cloud over the Obama administration’s goal of making America’s workforce the most college-educated in the world by 2020.

The report underscores that students who start out at two-year colleges, such as community colleges, are far less likely to eventually earn a four-year degree. High school graduates from low-income families who began at a four-year college earned bachelor’s degrees more than three times as often as those who started at a two-year college, 62 versus 20 percent. The rate was 67 versus 34 percent, respectively, for those from moderate-income families.

Other findings from the report:

  • Over the last two decades, the cost of four-year public colleges minus grant aid has risen from 41 to 48 percent of family income for low-income high school graduates, and from 22 to 26 percent for moderate-income high school graduates.
  • Between 1992 and 2004, initial enrollment rates of academically qualified low- and moderate-income high school graduates in four-year colleges dropped from 54 percent to 40 percent, and from 59 percent to 53 percent, respectively.

 

Recommendations

The report recommends, among other policy changes, reinvigorating the access and persistence partnerships that increase need-based aid from all sources; moderating the trend toward merit-based aid and the increasing reliance on loans; and reducing financial barriers to facilitate transfers from two- to four-year colleges.

It also recommends strengthening early intervention programs for low- and moderate-income students. Youth workers in the field of college access for low-income students say such work is important to address the academic, financial and psychological barriers that often conspire to dissuade youths from thinking that they are capable of succeeding in college.

“Low-income students need more than just money,” said Traci Kirtley, chief operating officer at Admission Possible, a St. Paul, Minn.-based organization that provides college access services to roughly 1,500 youths in the Twin Cities and Milwaukee. “They need a more comprehensive understanding about how the whole process works and how they can get on track to anticipate that.”