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Better Colleges Failing to Lure Poorer Strivers

March 16, 2013 by Leave a Comment

The pattern contributes to widening economic inequality and low levels of mobility in this country, economists say, because college graduates earn so much more on average than nongraduates do. Low-income students who excel in high school often do not graduate from the less selective colleges they attend.

Only 34 percent of high-achieving high school seniors in the bottom fourth of income distribution attended any one of the country’s 238 most selective colleges, according to the analysis, conducted by Caroline M. Hoxby of Stanford and Christopher Avery of Harvard, two longtime education researchers. Among top students in the highest income quartile, that figure was 78 percent.

The findings underscore that elite public and private colleges, despite a stated desire to recruit an economically diverse group of students, have largely failed to do so.

Many top low-income students instead attend community colleges or four-year institutions closer to their homes, the study found. The students often are unaware of the amount of financial aid available or simply do not consider a top college because they have never met someone who attended one, according to the study’s authors, other experts and high school guidance counselors.

“A lot of low-income and middle-income students have the inclination to stay local, at known colleges, which is understandable when you think about it,” said George Moran, a guidance counselor at Central Magnet High School in Bridgeport, Conn. “They didn’t have any other examples, any models — who’s ever heard of Bowdoin College?”

Whatever the reasons, the choice frequently has major consequences. The colleges that most low-income students attend have fewer resources and lower graduation rates than selective colleges, and many students who attend a local college do not graduate. Those who do graduate can miss out on the career opportunities that top colleges offer.

The new study is beginning to receive attention among scholars and college officials because it is more comprehensive than other research on college choices. The study suggests that the problems, and the opportunities, for low-income students are larger than previously thought.

“It’s pretty close to unimpeachable — they’re drawing on a national sample,” said Tom Parker, the dean of admissions at Amherst College, which has aggressively recruited poor and middle-class students in recent years. That so many high-achieving, lower-income students exist “is a very important realization,” Mr. Parker said, and he suggested that colleges should become more creative in persuading them to apply.

Top low-income students in the nation’s 15 largest metropolitan areas do often apply to selective colleges, according to the study, which was based on test scores, self-reported data, and census and other data for the high school class of 2008. But such students from smaller metropolitan areas — like Bridgeport; Memphis; Sacramento; Toledo, Ohio; and Tulsa, Okla. — and rural areas typically do not.

These students, Ms. Hoxby said, “lack exposure to people who say there is a difference among colleges.”

Elite colleges may soon face more pressure to recruit poor and middle-class students, if the Supreme Court restricts race-based affirmative action. A ruling in the case, involving the University of Texas, is expected sometime before late June.

Colleges currently give little or no advantage in the admissions process to low-income students, compared with more affluent students of the same race, other research has found. A broad ruling against the University of Texas affirmative action program could cause colleges to take into account various socioeconomic measures, including income, neighborhood and family composition. Such a step would require an increase in these colleges’ financial aid spending but would help them enroll significant numbers of minority students.

Among high-achieving, low-income students, 6 percent were black, 8 percent Latino, 15 percent Asian-American and 69 percent white, the study found.

“If there are changes to how we define diversity,” said Greg W. Roberts, the dean of admission at the University of Virginia, referring to the court case, “then I expect schools will really work hard at identifying low-income students.”

Ms. Hoxby and Mr. Avery, both economists, compared the current approach of colleges to looking under a streetlight for a lost key. The institutions continue to focus their recruiting efforts on a small subset of high schools in cities like Boston, New York and Los Angeles that have strong low-income students.

The researchers defined high-achieving students as those very likely to gain admission to a selective college, which translated into roughly the top 4 percent nationwide. Students needed to have at least an A-minus average and a score in the top 10 percent among students who took the SAT or the ACT.

Of these high achievers, 34 percent came from families in the top fourth of earners, 27 percent from the second fourth, 22 percent from the third fourth and 17 percent from the bottom fourth. (The researchers based the income cutoffs on the population of families with a high school senior living at home, with $41,472 being the dividing line for the bottom quartile and $120,776 for the top.)

Winona Leon, a sophomore at the University of Southern California who grew up in West Texas, said she was not surprised by the study’s results. Ms. Leon was the valedictorian of her 17-member senior class in the ranch town of Fort Davis, where Advanced Placement classes and SAT preparation were rare.

“It was really on ourselves to create those resources,” she said.

She first assumed that faraway colleges would be too expensive, given their high list prices and the cost of plane tickets home. But after receiving a mailing from QuestBridge, an outreach program for low-income students, she came to realize that a top college might offer her enough financial aid to make it less expensive than a state university in Texas.

On average, private colleges and top state universities are substantially more expensive than community colleges, even with financial aid. But some colleges, especially the most selective, offer enough aid to close or eliminate the gap for low-income students.

If they make it to top colleges, high-achieving, low-income students tend to thrive there, the paper found. Based on the most recent data, 89 percent of such students at selective colleges had graduated or were on pace to do so, compared with only 50 percent of top low-income students at nonselective colleges.

The study will be published in the Brookings Papers on Economic Activity.

The authors emphasized that their data did not prove that students not applying to top colleges would apply and excel if colleges recruited them more heavily. Ms. Hoxby and Sarah Turner, a University of Virginia professor, are conducting follow-up research in which they perform random trials to evaluate which recruiting techniques work and how the students subsequently do.

For colleges, the potential recruiting techniques include mailed brochures, phone calls, e-mail, social media and outreach from alumni. Another recent study, cited in the Hoxby-Avery paper, suggests that very selective colleges have at least one graduate in the “vast majority of U.S. counties.”

Article source: http://www.nytimes.com/2013/03/17/education/scholarly-poor-often-overlook-better-colleges.html?partner=rss&emc=rss

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Economix Blog: The Leading Liberal Against Affirmative Action

March 9, 2013 by Leave a Comment

My Capital Ideas column this week looks at liberals who would see some upsides if the Supreme Court made substantial changes to affirmative-action programs. The justices heard arguments in such a case in October — Fisher v. the University of Texas — and are expected to issue their decision between March 18 and late June.

Perhaps the most prominent self-described progressive with doubts about the current version of affirmative action is Richard D. Kahlenberg, of the Century Foundation. Mr. Kahlenberg argues that a race-focused version of affirmative action can be unfair, is inconsistent with many of the program’s original goals and has lost the support of the public. Today’s affirmative action, he says, helps perpetuate privilege, by helping to fill elite-college campuses with an ethnically diverse mix of affluent students.

In its place, he has suggested that selective public and private colleges adopt a class-based affirmative action. Done right — by taking into account not only household income but also wealth, family status and geographic concentration of poverty — such a program could enroll similar numbers of minority students as the current version, Mr. Kahlenberg says.

As he writes:

Recruiting fairly privileged students of color is far less expensive than including low-income and working-class kids of all races. While higher education’s vigorous defense of affirmative action on one level represents a sincere desire for greater racial equality, it has another less virtuous side to it, as racial preferences avoid the hard work of addressing deeply rooted inequalities and instead provide what Stephen Carter has called “racial justice on the cheap.”

Mr. Kahlenberg does not question the continued presence of racism. Its existence is one reason that some other higher-education experts who share some of Mr. Kahlenberg’s views would rather see colleges move toward a combination of race- and class-based affirmative action.

When I asked him if he agreed, he said he had spent a long time thinking about that issue and ultimately decided he favored only class-based preferences. They can be structured in a way to recruit a racially diverse class, he believes — and college administrators have come to care so much more about racial diversity than about economic diversity that the two programs would not coexist easily. “My reluctant conclusion is that the only way to get universities to focus on class is if they can’t first use race,” he said.

Why do they care less about class? That’s a complex question that deserves a separate blog post. My guess is that the answer is a combination of a sincere focus on overcoming centuries of racial discrimination; a desire to save money on financial aid; a discomfort with class as a subject that permeates much of American society; and a lingering gentility on some elite university campuses.

For a different from than Mr. Kahlenberg’s, you can read the legal brief filed by the University of Texas or several other briefs — listed under “Briefs in Support of Respondent” — filed by universities, civil-rights groups and others.

Whether you agree with Mr. Kahlenberg’s solutions, his report, “A Better Affirmative Action,” provides a detailed overview of the program, from Martin Luther King Jr. to today. The final section, written by Halley Potter, also of the Century Foundation, profiles several states that have banned race-based affirmative action and looks at how universities have responded.

Those states may offer a preview of what will happen if the Supreme Court rules against the University of Texas.

Article source: http://economix.blogs.nytimes.com/2013/03/09/the-leading-liberal-against-affirmative-action/?partner=rss&emc=rss

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Moody’s Outlook on Higher Education Turns Negative

January 16, 2013 by Leave a Comment

The credit reporting agency Moody’s said on Wednesday that it had revised its financial outlook for colleges and universities, giving a negative grade to the entire field.

For the last two years, Moody’s Investors Service gave the nation’s most elite public and private colleges a stable forecast while assigning a negative outlook to the rest of higher education. (Moody’s assigned a negative outlook for the sector in 2009, but it upgraded the most elite ones to stable in 2011-2012.)

On Wednesday, Moody’s explained the change by saying that even the best colleges and universities faced diminished prospects for revenue growth, given mounting public pressure to keep tuition down, a weak economy and the prospect that a penny-pinching Congress could cut financing for research grants and student aid.

The report advocates “bolder actions by university leaders to reduce costs and increase operational efficiency.”

“The sector will need to adjust to the prospect of muted revenue growth,” the report says. “Strong governance and management leadership will be needed by most universities as they navigate through this period of intensified change and challenge.”

While Moody’s gave a negative outlook for the overall industry, most of the nation’s top colleges and universities still carry the top credit rankings.

Nonetheless, the Moody’s report reflects a time of rapid and disruptive change in higher education. Before the financial crisis, colleges and universities routinely raised tuition and fees as administrators sought to burnish their reputations — and the school’s rankings — with new buildings and more student services.

That golden era was upended by the financial crisis. As household income dropped and jobs became scarce for college graduates, families became increasingly vulnerable to college costs and the prospect of students taking on onerous debt. At the same time, institutions could no longer count on an annual windfall from endowment returns, alumni gifts and state financing. All shriveled as the economy soured, and they have not yet fully recovered.

In the 2011-2012 academic year, for instance, American families spent, on average, 5 percent less on higher education than in the previous year, Moody’s said. As a result, 25 percent of the private colleges that Moody’s rated failed to raise tuition in fiscal 2011 at or beyond the rate of inflation; 21 percent of rated public universities failed to do so.

Students have become more dependent on federal grants and loans since the financial crisis. Any curtailment of federal aid could put further budget pressures on schools. Pell Grants for low-income students provided $36.5 billion to colleges and universities in fiscal 2011. That represented a median 21 percent of net tuition revenue for regional public universities.

The rapid emergence of online learning provides both opportunities and challenges for higher education, Moody’s said. While online classes could threaten to undermine the residential college model, they could also provide new ways to make money and provide schools with broader audiences.

Moody’s said the average debt burden for full-time students grew 55 percent in the 10 years that ended in 2012. But it maintained that the average debt load was manageable for most students, since 72 percent of student loans were held by borrowers with less than $25,000 in debt. Nonetheless, the report noted that the increasing focus on student debt and college affordability by the media and politicians puts additional pressure on college administrators to rein in costs.

“Until universities demonstrate better ability to lower their cost of operations, perhaps through more intensive use of online classes and elimination or reduction of tenure, we expect government officials to produce bolder solutions in response to the public outcry against the cost of higher education,” the report said.

Article source: http://www.nytimes.com/2013/01/17/business/moodys-outlook-on-higher-education-turns-negative.html?partner=rss&emc=rss

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