Living expenses are a bigger barrier for students than tuition, report says
The prices of stickers at most, if not all, colleges and universities across the country have increased since the mid-1990s, and some have increased dramatically.
But financial aid for low- and middle-income students has generally kept pace with these rising costs, according to one. new report from the American Enterprise Institute.
The report, “Evidence Against the Free-College Agenda: An Analysis of Prices, Financial Aid and Affordability at Public Universities,” argues that free tuition programs at four-year institutions would not be helpful to students most in need. Instead, policymakers should look at living costs.
“Much of the push for a free college seems to be based on the idea that public university prices have spiraled out of control,” said Jason Delisle, author of the report and resident researcher at AEI.
Those who advocate free tuition tend to focus on the sticker price, according to Delisle, and not the net price for students after aid. Sometimes, he said, they focus on a specific piece of the puzzle, like government credits.
In the report, Delisle looked at the national average price of tuition stamps for four-year public institutions in the state from 1995-96 to 2015-16, but also looked at the national average net price after aid. For students who received Federal Pell Grants, the net price only increased from $ 563 to $ 1,110 during this period, even though the price of the stickers increased from $ 3,534 to $ 8,158. For students from families earning less than $ 125,000 in annual income, the net price of tuition has increased from $ 2,000 to $ 2,447.
The Pell Grant, State Aid, Institutional Aid, Federal Tax Benefits, and Private Aid are all included in the calculation. Federal student loans are not.
“If the argument for a free college is that the prices have really changed a lot at these institutions, and it turns out they haven’t, then a, we don’t need the free college proposals, ”Delisle said. “But it is also an unrecognized success of our financial aid programs.”
At the same time, living costs have increased. Although aid was able to cover part of this increase, according to the report, it still does not cover all.
“They make an important point, that a big part of the cost of going to college is the cost of living,” said Clare McCann, deputy director of federal higher education policy at New America. “This has been an underestimated point in many of the college pledge programs out there. “
But McCann questioned some of the help Delisle factored into the net price calculations in the report, such as federal tax benefits, which students and their families typically don’t see until they file their return. of income.
Delisle argues that the tax breaks are relevant because people are clamoring for them, even if they don’t think about it while reading their tuition bills. And the government spends money on these grants.
“It definitely helps students, and it costs the government of course, but it’s not help that is immediately available to students,” McCann said. “The question is not only how much money they get in a year, but also when they get it.”
McCann agreed that policymakers need to pay more attention to living costs and find ways to contain those costs.
Even the way institutions measure the cost of obtaining a degree is not always accurate, she said. Adopting policies and guidelines to standardize what and how institutions measure the cost of living for students could go a long way in understanding the problem and potentially finding ways to control it, McCann said.
Is college affordable?
Some experts believe the report strengthens their argument about college affordability.
“The report tries to make the case that public colleges are more affordable than some claim,” said Andrew Nichols, senior director of higher education research and data analysis at the Education Trust. “But for me, the report reinforces the idea that colleges are unaffordable.”
Affordability of colleges includes living costs, Nichols said, and Delisle’s report shows that.
While separating living expenses from tuition can be helpful for policy solutions, Nichols said, ultimately students pay for everything.
Rather, he said the report shows that free college programs, as they are often designed now, are not adequate.
It also excludes students who do not have access to federal or state aid, even if they need it, such as undocumented or incarcerated students, said Jaime Ramirez-Mendoza, political analyst for the Education Trust.
Free university programs must also meet the needs of all students, Ramirez-Mendoza said, adding that tuition and fees are only 40% of the total price of university attendance at public four-year institutions. .
There are a number of ways to manage student living expenses, Nichols said. Free equity-focused college programs, such as those that use a first dollar approach and cover tuition fees before other aids, allowing students to use Pell Grants for living expenses, are one way. . Others include doubling Pell grants and helping states cover higher education expenses.
Nichols also pointed out that since most salaries remain stable or even decline with inflation, any increase in college prices is important. The state context is also important, as it found significant variation in costs across states in a report since last year.
The alternative to free college programs that could help students is to put more money into the existing support system, according to Delisle, whose report shows it works well. Policymakers must also find ways to contain costs, whether driven by the “arms race for equipment” or simply by inflation, he said.
But the solution to containing living costs could go beyond higher education.
“It costs more money to live in this country now, and at the same time, we don’t see wages keeping pace,” McCann said. “A much broader strategy is needed than a strategy focused solely on higher education.”