Harry Wong
Dec 2017
Vol 14 No 4

Higher Education Becoming More Difficult To Finance

By Stewart Brekke

Educational attainment is a very strong predictor of well being. It can be shown that young adults who have achieved higher levels of education are more likely to have economic success than those who do not. Besides qualifying one for a broader spectrum of jobs, completing more years of education also protects one against unemployment. Also, higher levels of educational attainment often lead to higher wages and income.

Americans who have attained bachelor’s degrees or higher had earned an average income that was more than 65 percent greater than that of their counterparts with only a high school diploma. Over the last few decades earning differentials by education have been increasing especially among women and Black workers. Also, adults having higher levels of education state that they are in better health and that they have higher levels of socio-emotional well-being. Higher educational attainment is also associated with lower levels of divorce and incarceration.

Educational attainment in the United States is increasing. Educational attainment usually refers to the highest level of education completed such as a high school diploma (or equivalency certificate), a bachelor’s degree or a master’s degree. From 1990 to 2014 the educational attainment rates of 25 to 29 year olds improved. For example, the percentage of persons who received a high school diploma increased from 86 to 91 percentage points with most of the change occurring from 2004 to 2014.  The percentage improvement among those who had completed a bachelor’s or higher degree increased from 23 percent in 1990 to 34 percent in 2014. The percentage increase among those who completed a master’s degree or higher degree was from 5 percent in 1995 to 8 percent in 2014.

In general attainment rates for females have been higher than those for males at each educational level since 2000. In 1990 the percentages of male and female 25 to 29 year olds who had completed a bachelor’s degree or higher were not very different, but in 2014 the percentage of females, 37 percent, attaining this level of education was 6 percentage points higher than males doing so—31 percent. Also, there was a similarity in 1995 with the percentage of males and females who had completed a master’s degree or higher being almost the same.  However, in 2014 about 9 percent of females completed a master’s degree or higher compared with 6 percent of males.

From 1990 to 2014 the percentage of 25 to 29 year olds who had attained a bachelor’s degree increased for Whites from 26 to 41 percent,  for Blacks from 13 to 22 percent, for Hispanics from 8 to 15 percent, and for Asians/ Pacific Islanders from 43 to 61 percent. Also, for the Hispanics most of this increase occurred in the last 10 years.  From 1990 to 2014  a gap increased between Whites and Blacks in the rate of attaining a bachelor’s or higher degree which widened from13 to 18 percentage points. The gap between Whites and Hispanics in attaining this level of education widened from 18 to 26 percentage points. In addition from 1995 to 2014 the percentage of 25 to 29 year olds who received a master’s degree or beyond increased for Whites from  5 to 9 percent, for Blacks from 2 to 4 percent, for Hispanics from 2 to 3 percent, and for Asian/Pacific Islanders from 11 to 18 percent. The gap between Whites and Hispanics was wider in 2014 by 6 percentage points than in 1995 which was by 4 percentage points. Notably this gap between Whites and Blacks in the year 2014 was not very different from that in 1995.

When Americans think about their hopes and desires for themselves and their children, they often think about the American dream of a decent paying job, a home, a secure retirement and a better life for their children. For most Americans a “college education” for their children is an essential part of this vision.  Many Americans say that having a college degree is important to getting ahead.

Today, a college education is now seen as essential to achieving  a comfortable  middle class life style.  The growing concern about the importance of a college education parallels the increasing concern about the cost of higher education for their children. The students and parents have started to worry that the students will not be able to afford a college education and this in turn will mean that the students will be shut out of the middle class.

As the concerns grow about the importance of a “college education” there is a growing concern about the price of  higher education. One study found that 70  percent of Americans think that higher education is being priced beyond the income of the average family. This is in comparison to 44 percent of Americans who feel that the cost of a house is being priced out of reach. Some state specific studies have shown that concerns about the cost of a college education may intensify during an economic downturn when states try to make up for declining tax revenues by raising the tuition and fees for public higher education.

Most American families have lost ground in college affordability. Over the last two decades it has been found that the cost of attending both two and four year public and private colleges (including tuition and other education related expenses) has grown more rapidly than inflation and family income. The result of this is that the share of family income needed to pay for tuition and other college expenses has increased.

The main driver of  the increased cost of attending college is higher tuition and only the wealthiest families have seen their incomes keep pace with increases in tuition. The lowest income families have lost the most ground in this regard and this appears to be a major component in their lower rates of higher education attendance. For example, in 1980 at public two year colleges represented 6 percent of family income. For the lowest income families in 2000 tuition represented 12 percent of family income.  In comparison tuition at public four year colleges and universities represented 13 percent of income for the lowest income families in 1980. In the year 2000 tuition at these colleges and universities equaled 25 percent of their income.

Despite the decline in affordability, Americans, particularly those from middle and high income families, still continue to attend college in record numbers. From past experience even in recessions college enrollments will continue to grow. In order to to enhance their opportunities and realize their educational aspirations, Americans will work more hours than in the past, incur greater debt and set aside more of their income to pay for a college education. So far Americans have lost ground and will continue to lose more ground if the trend of rising tuition and other college expenses continues.

In summary more Americans are attending institutions of higher education and receiving bachelor’s degrees and above than ever before—this includes both majority and minority groups. It is almost essential for a young person to obtain a college education to be assured of a good employment situation and a place in the middle class. However, due to increasing college expenses this American dream may become harder to obtain, especially for the members of lower income families.

About the Author
Stewart E Brekke is a retired high school physics chemistry and math teacher who taught in the inner city schools of Chicago. He writes on educational subjects and presents scientific papers on physics subjects in retirement. He received his PhD from the International University for Graduate Studies in 2012 at the age of 72.



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This entry was posted on Friday, April 1st, 2016 and is filed under *ISSUES, April 2016, Stewart Brekke. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.
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