Noting a decline in middle-class students, colleges provide more aid

As colleges enroll more low-income students and high-income students displace middle-income students at the most selective universities, experts have voiced concerns about a “hollowing of the middle class” in higher education, writes The Hechinger Report.

In the past two decades, the share of middle-class students—those from families in the middle 60 percent of income—has dropped from 48 percent to 42 percent at private, nonprofit schools, and from 48 percent to 40 percent at public, four-year schools. The percentage of middle-class students attending college immediately after high school has been gradually decreasing since 2010. The trend not only poses a threat to colleges’ financial sustainability but also reinforces a cycle of inequality, since students without higher education earn less income during their lifetimes. To counter this trend, some colleges are emphasizing financial literacy and aid packages for applicants from middle-income households.

Intergenerational pressures on the middle class

An analysis by Georgetown University’s Center for Education and the Workforce (CEW) found that cost is a chief reason middle-class students do not plan to attend college. When adjusted for inflation, the total cost of college has risen by 54 percent since 1999 at private nonprofit colleges and by 78 percent at public institutions, while the median middle-class income has remained consistent.

An increasing number of middle-class parents have student debt, which constrains their ability to pay for their children’s education. But students who do not attend college make $1 million less than their college-going peers over the course of their lives, says Jeff Strohl, the CEW’s director of research. “As the world upskills, we should be very concerned,” about this cycle of decreased economic power for the middle class, Strohl says.

Consequences for colleges’ bottom lines

Waning enrollment from middle-income students also has financial consequences for colleges. Middle-income students have more capacity than low-income students to pay partial tuition, room, and board; they also are less likely to eventually drop out. In drawing less revenue from middle-income students, some colleges have become more reliant on high-income students. “The fundamental issue [for colleges] is avoiding a bifurcated situation where you have the higher-income students subsidizing a lot of lower-income students” and not enough people in between, said Greg Wolniak, associate professor at the University of Georgia Institute of Higher Education.

Increasing financial aid packages and sticker price education

To attract middle-class families who often balk at the sticker price of college, many institutions are working to educate parents about financial aid and more widely advertising their aid packages to prospective students. According to The Hechinger Report, there was a 25 percent increase between 2009 and 2017 in the amount of financial aid four-year institutions provided to students from families making $48,001 to $75,000, and a 32 percent increase in financial aid provided to students from families making $75,001 to $110,000.

Colleges leading the way include the University of Virginia, which has eliminated tuition for in-state students whose families earn less than $80,000 annually. As a result of this scholarship and outreach, 50 additional students attended tuition- and fee-free this year.

Texas-based Rice University recently made a concerted push to get the word out about its program to cover tuition for students from families with up to $130,000 in income per year. University President David Leebron said “we were concerned about this trend of the hollowing out of the middle class. When we tried to peer into the future, we realized that if nothing changes, that’s what we’re going to see.” And next fall, Colorado College will begin providing free tuition for Coloradoans with gross family income between $60,000 to $125,000; for the $125,000 to $200,000 income bracket, tuition will match that of its public competitor, University of Colorado.

“We care deeply about the socioeconomic diversity within our student body,” said Mark Hatch, vice president of enrollment. “If we have a college campus with the barbell effect where you have full-pay at one knob and full-need at the other bulb and that thin bar in the middle, it doesn’t serve your institution as a living-learning environment.”

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