Year-round Pell Grants linked to improved retention, earnings

A new study from the Community College Research Center at Columbia University shows the benefits of making Pell Grants available not only for fall and spring semesters but also summer sessions, finding that students with summer Pell Grants were more likely to persist, complete their degree, and have stronger employment outcomes than those who did not have access to year-round grants, according to Diverse Issues in Higher Education.

For the majority of Pell Grants’ 50-year history, they have been awarded to low-income students to cover a substantial portion of college costs for two full-time semesters per year, while excluding tuition coverage for summer classes. In response to research indicating that continuous enrollment increases student retention and improves college completion rates, Congress extended Pell Grants from two semesters to three per academic year in 2009, so that Pell Grant recipients had access to funds for summer courses. Funding for year-round Pell was cut in 2011 as a cost-saving measure and due to a lack of evidence affirming its value to students, but Congress reinstated the program in 2017, providing Pell-eligible students once again with additional grants for summer courses.

The new study supports the continuation of year-round Pell Grants, as it indicates that access to those grants have short- and long-term benefits for low-income students and students from non-traditional backgrounds and underserved communities.

“A lot of policies, you expect to have an effect within that semester and then maybe in one year, but very rarely do you find consistent positive impact down the road,” said Vivian Yuen Ting Liu, associate director of the office of research, evaluation, and program support at the City University of New York (CUNY), who led the study.

Benefits of year-round Pell Grants

The study analyzed administrative data for community college students in the CUNY system—the largest urban university system in the country—who first enrolled between 2005 to 2010 and 2013 to 2018. Researchers examined persistence, completion, and employment data for students who were eligible for summer Pell Grants after its implementation compared to those who were summer Pell-ineligible.

Students who received Pell Grants for the summer semester in their first year within the 2009-11 period were 29% more likely to enroll in classes the following fall semester, 13% more likely to have earned an associate degree within three years, and 7% more likely to have earned a bachelor’s degree within six years, compared to students who did not have access to the grants, Diverse Issues reports. Retention and degree completion rates were even higher among summer Pell Grant recipients from 2017 onward, according to Liu. They also earned higher wages, making 6% more, or the equivalent of an additional $1,357 per year, nine years after enrollment than students without access to the grants.

Related: Community colleges see bump in summer enrollment after year-round Pell returns >

Access to year-round Pell Grants was particularly beneficial to Black students, who earn less and owe more in student debt than their peers after graduation. Access to year-round Pell Grants increased Black summer enrollment by over three percentage points and resulted in a 1.3-point increase in their likelihood to complete their bachelor’s degree within six years. They also saw higher earnings six and nine years after enrolling in college.

Students older than 25 also benefited from summer Pell Grants: those with access to year-round Pell Grants were more likely to enroll in summer classes, complete an associate degree in three years, and have higher earnings than similarly aged students without access to the grants. 

Year-round Pell Grants produce financial incentives for underserved populations not only to enroll during summer sessions but also to speed up their degree progress, the study says. However, to address workforce needs and support students looking for career mobility, bipartisan support has been increasing for short-term Pell Grants that fund workforce programs as short as eight weeks, loosening restrictions that currently limit Pell Grants to programs running at least 15 weeks, Inside Higher Ed reports.

“In light of these findings, it would be tragic if Congress chose to fund short-term Pell by defunding summer Pell,” Stephen Katsinas, Ph.D., director of the Education Policy Center at the University of Alabama, told Diverse Issues. “Summer Pell moves students through the system faster, which is what we want.”

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