Access to public universities linked to higher earnings, degree completion

Dive Brief: 

  • Students who enroll in public universities have higher household incomes by around age 30 than do those who were largely unable to access these institutions, according to a new working paper published by the National Bureau of Economic Research, which examined trends in Georgia. 
  • The researchers compared students who barely met the standardized test score threshold for attendance at one of 17 public, four-year institutions in the University System of Georgia they studied, to students who narrowly missed it. The former group was much more likely to attend a Georgia public university and complete a bachelor’s degree, they found. 
  • The paper adds to a growing body of evidence suggesting that the benefits of attending a public university outweigh the costs of attendance. 

Dive Insight: 

Access to public universities can help boost students’ economic mobility. For students who only just met the standardized test score requirements, enrolling in the sample of University System of Georgia institutions was linked to a 20% increase in their household income at around age 30, the paper finds. The increase is even higher  at 40%  for students from low-income high schools. 

Moreover, the findings suggest that reducing selectivity won’t harm an institution, said Jonathan Smith, co-author of the paper and an assistant professor of economics at Georgia State University. 

That’s because the researchers focused on students with test scores that only just met requirements for admission at one of the system’s institutions. “These are students who are least academically qualified, and they’re thriving,” he added. 

Investing in public higher education can also pay off for states because they receive more tax revenue down the line if household incomes increase. Georgia breaks even about 10 years after it initially subsidizes a student’s education, the paper notes. 

“Investing in the four-year university system (in Georgia) is a very good bet for the state, and so cutting access and enrollment to students, even in times where there are budgetary issues, can be short-sighted,” Smith said. He said the findings are especially salient in light of the pandemic, which is expected to cause a lengthy global recession

It’s unclear how the crisis will affect higher education funding in the long term, but state allocations have declined in previous economic downturns. Several states — including OhioCalifornia and Nevada — have already announced or are exploring higher education cuts.

Colleges have raised tuition to make up for flagging public support during past economic contractions, but some are stepping away from planned increases because of the pandemic. With many students and their families losing their jobs or having their hours cut, college officials fear they won’t be able to pay higher prices. 

The research findings also come as some students reportedly consider attending community college to save money if four-year institutions continue instruction remotely. 

Some community colleges that offer bachelor’s degrees boast persistence rates for those programs that are similar to those at four-year schools. And students who transfer from a community college just as likely to graduate in six years from a four-year institution than students who enrolled directly after high school, according to a 2019 report from the Jack Kent Cooke Foundation. 

Yet students who attended a public university in Georgia were nearly five times as likely to graduate with a bachelor’s degree within six years of enrolling than those denied access to the system. “If you want a bachelor’s degree in Georgia,” Smith said, “you should start at a four-year university.” 

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