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Fast Money & Foreign Objects
The richest 25% of American families account for more than half of all college graduates
By Jillian Berman
Published: Apr 19, 2016 9:29 a.m. ET
Getting through college is more difficult for poor students
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A new report offers more insight into why student debt is often an unequal burden.
Graduating college is much harder if you’re poor, a new report indicates.
In 2014, just 10% of dependent family members who said they received a bachelor’s degree by the time they were 24 years old came from families in the lowest income quartile, according to a study released Tuesday by the Pell Institute for the Study of Opportunity in Higher Education in Washington, D.C. and PennAhead, an organization at the University of Pennsylvania focused on higher education policy. By contrast, 54% of bachelor’s degrees awarded to dependent family members went to those in the highest income quartile.
Institute for the Study of Opportunity in Higher Education and PennAhead
The gap in college attainment between rich and poor kids has hardly budged over the last several decades.
There are a number of reasons for that gap in college attainment and for why it’s remained so large for so long, said Margaret Cahalan, the director of the Pell Institute. These include rising college costs and growing income inequality, which can make it more difficult for poor students to afford to get through college and move up the economic ladder, she said. “We’ve increased the number and the percentages of students going into college and we’ve narrowed that gap a little bit, but what we haven’t narrowed is bachelor’s degree attainment,” she said.
The report also points to the declining value of a Pell Grant, the money the federal government provides to low-income students to attend college, as one of the reasons poor students struggle to get through school.
Institute for the Study of Opportunity in Higher Education and PennAhead
The gap between the value of a Pell Grant and the cost of college has widened.
In other words, Pell Grants don’t cover nearly as much of students’ tuition as they used to. That means low-income students have to rely increasingly on loans, work and other sources of income to afford tuition, never mind all of the other expenses that come with being a college student. In this way, the declining value of a Pell Grant leads to inherently unequal situations for college students, Cahalan said.
“A student from the highest income category is not necessarily required to work to just barely survive,” she said.
It’s not just the lack of funding that may be keeping poor students from getting degrees. It also may be the schools they’re attending. The report notes that the gap between two-year public colleges and four-year public colleges has widened over time. In many cases, students with less money are attending schools with fewer resources, making it more difficult for them to get through. “We have one system for the poor students and then we have one system for the middle-class students and then we have one system for the very, very rich students,” Cahalan said.
The student body at for-profit colleges is largely made up of poor students, as well. The report found that three quarters of students at four-year for-profit universities were receiving Pell Grants, compared to one-third of students at private non-profit four year schools and nearly 40% of students at public colleges. Students who attend for-profit colleges are less likely to graduate, according to data from the Department of Education.
Still, Cahalan cautioned against placing too much weight on the role of for-profit colleges in the gap in college degree attainment between poor and rich students, because she noted that these schools still serve a very small population of poor college students overall. In addition, she said for-profit schools are often enrolling students that other, more selective schools won’t take.
Institute for the Study of Opportunity in Higher Education and PennAhead
For-profit schools have a much higher share of Pell recipients than their nonprofit peers.
Critics say for-profit colleges target poor students with promises of degrees and better jobs that they ultimately don’t fulfill. During the Great Recession, enrollment at for-profit colleges jumped sharply as people struggling to find and keep jobs looked to re-tool.
Institute for the Study of Opportunity in Higher Education and PennAhead
The for-profit college industry has grown much faster than its nonprofit peers over the past several years.
The richest 25% of American families account for more than half of all college graduates
Millennials want to have their cake and eat it too.
By Jillian Berman
Published: Apr 19, 2016 9:29 a.m. ET
Getting through college is more difficult for poor students
A new report offers more insight into why student debt is often an unequal burden.
Graduating college is much harder if you’re poor, a new report indicates.
In 2014, just 10% of dependent family members who said they received a bachelor’s degree by the time they were 24 years old came from families in the lowest income quartile, according to a study released Tuesday by the Pell Institute for the Study of Opportunity in Higher Education in Washington, D.C. and PennAhead, an organization at the University of Pennsylvania focused on higher education policy. By contrast, 54% of bachelor’s degrees awarded to dependent family members went to those in the highest income quartile.
The gap in college attainment between rich and poor kids has hardly budged over the last several decades.
There are a number of reasons for that gap in college attainment and for why it’s remained so large for so long, said Margaret Cahalan, the director of the Pell Institute. These include rising college costs and growing income inequality, which can make it more difficult for poor students to afford to get through college and move up the economic ladder, she said. “We’ve increased the number and the percentages of students going into college and we’ve narrowed that gap a little bit, but what we haven’t narrowed is bachelor’s degree attainment,” she said.
The report also points to the declining value of a Pell Grant, the money the federal government provides to low-income students to attend college, as one of the reasons poor students struggle to get through school.
The gap between the value of a Pell Grant and the cost of college has widened.
In other words, Pell Grants don’t cover nearly as much of students’ tuition as they used to. That means low-income students have to rely increasingly on loans, work and other sources of income to afford tuition, never mind all of the other expenses that come with being a college student. In this way, the declining value of a Pell Grant leads to inherently unequal situations for college students, Cahalan said.
“A student from the highest income category is not necessarily required to work to just barely survive,” she said.
It’s not just the lack of funding that may be keeping poor students from getting degrees. It also may be the schools they’re attending. The report notes that the gap between two-year public colleges and four-year public colleges has widened over time. In many cases, students with less money are attending schools with fewer resources, making it more difficult for them to get through. “We have one system for the poor students and then we have one system for the middle-class students and then we have one system for the very, very rich students,” Cahalan said.
The student body at for-profit colleges is largely made up of poor students, as well. The report found that three quarters of students at four-year for-profit universities were receiving Pell Grants, compared to one-third of students at private non-profit four year schools and nearly 40% of students at public colleges. Students who attend for-profit colleges are less likely to graduate, according to data from the Department of Education.
Still, Cahalan cautioned against placing too much weight on the role of for-profit colleges in the gap in college degree attainment between poor and rich students, because she noted that these schools still serve a very small population of poor college students overall. In addition, she said for-profit schools are often enrolling students that other, more selective schools won’t take.
For-profit schools have a much higher share of Pell recipients than their nonprofit peers.
Critics say for-profit colleges target poor students with promises of degrees and better jobs that they ultimately don’t fulfill. During the Great Recession, enrollment at for-profit colleges jumped sharply as people struggling to find and keep jobs looked to re-tool.
The for-profit college industry has grown much faster than its nonprofit peers over the past several years.
The richest 25% of American families account for more than half of all college graduates
Millennials want to have their cake and eat it too.
