Access and Affordability in Higher Education

The US system of higher education faces many challenges in the twenty-first century. Critics contend that skyrocketing tuition costs have made postsecondary education unaffordable and contributed to record levels of student loan debt. The average inflation-adjusted annual cost of tuition and fees increased by 130 percent between 1990 and 2020. The average published cost of tuition and fees at four-year US colleges and universities for the 2022–2023 academic year reached $10,940 for in-state public and $39,400 for private nonprofit institutions, the equivalent of 15 and 56 percent of median household income, respectively.

Lack of affordability is one of several barriers restricting access to higher education for marginalized groups, including students of color, low-income students, first-generation college students, students with disabilities, and undocumented immigrants. Disparities in educational opportunity and attainment, meanwhile, contribute to the problem of economic inequality. Studies have shown that postsecondary education leads to higher-paying jobs and lower rates of unemployment. The median lifetime earnings for a person with a four-year college degree are double those of a person with only a high school diploma. An educated workforce also conveys benefits to society through innovation, job creation, and a larger tax base. Postsecondary institutions and policymakers are seeking ways to eliminate socioeconomic barriers and increase access to higher education for underserved populations.

Many factors contribute to the likelihood that a high school student will continue to college, including academic preparation, motivation, information about postsecondary options, access to support services, and financial resources. A student's family background and social network can impact the postsecondary decision-making process. Children of college-educated parents, for instance, are much more likely to enroll in college and to complete a degree than children whose parents did not go to college. Partly due to parental expectations and values, children of college-educated parents tend to take more advanced, honors, and college-preparatory courses that put them on a path toward higher education.

Students' race and socioeconomic status also influence the likelihood that they will pursue higher education. Minorities and low-income students are more likely to attend underperforming primary and secondary schools, which can negatively affect their academic preparation and college readiness. They are less likely to take college-preparatory courses and more likely to be placed in remedial or vocational education tracks. Critics charge that racial bias sometimes plays a role in determining which students are viewed as "college material" and which students are steered toward vocational education. According to a 2022 report published by the Pell Institute for the Study of Opportunity in Higher Education, in 2020 the rate of continuation to college was highest among Asian high school graduates, at 91 percent, followed by white students, at 75 percent. The rates were somewhat lower for Hispanic (67 percent) and Black (65 percent) students. Similarly, 85 percent of high school graduates from households in the highest family income quartile (over $141,887 annually) enrolled in postsecondary education, compared to 49 percent of students from households in the lowest family income quartile (under $46,697 annually).

Low-income and minority students who do enroll in postsecondary institutions are less likely to complete a degree. Many students have trouble adjusting to the academic rigor of college after attending low-performing high schools. Others struggle with the transition to an unfamiliar campus culture where they are surrounded by students from affluent families. Financial concerns also reduce the likelihood of college graduation for low-income and minority students. Many students have to work on campus to afford tuition, which reduces the time available for studying, and some have to quit school and find jobs to help support their families. The Pell Institute reported that as of 2020, only 30 percent of college students from the lowest income quartile earned a bachelor's degree by age twenty-four, compared to 76 percent of students from the highest quartile.

To improve access to higher education for underrepresented groups, academic experts suggest increasing communication between high schools and postsecondary institutions, so that students view college as a realistic goal and chart a path to achieve it. They also encourage high schools to offer advanced placement (AP) courses or dual enrollment opportunities to enable students to begin earning college credit early. By partnering with high schools, postsecondary institutions can provide low-income and minority students with information to facilitate the application process and ease the transition to college. Institutions can also provide support services once these students arrive on campus to help them succeed academically and complete their degrees.

The expense associated with higher education is an important factor in many students' decisions about whether to go to college. High tuition costs and the daunting prospect of accumulating tens of thousands of dollars in student loan debt pose an insurmountable barrier for many students from low-income families. Need-based federal financial aid has not kept up with rising tuition costs. The federal Pell Grant Program reported that 44 percent of undergraduate students benefited directly from the program during the 2017–2018 award year. However, the value of the maximum Pell Grant amount dropped from covering nearly 80 percent of the total cost of attending a public four-year institution during the 1978–1979 academic year to covering just 30 percent of the total cost during the 2020–2021 academic year.

Many postsecondary institutions offer merit scholarships to attract highly qualified applicants and reduce the out-of-pocket expenses for students. Critics note, however, that the student performance criteria used in awarding merit scholarships—such as standardized test scores, grade point average, class rank, and academic rigor of high school curriculum—tend to correlate with family income. As a result, students from affluent families are more likely to qualify for merit-based aid from postsecondary institutions, even though they are more likely to be able to afford college without such assistance. The Pell Institute reported that in 2016, undergraduate students in the lowest family income quartile averaged more than $29,110 in unmet financial need per year of undergraduate college attendance, while students in the highest quartile had an average surplus of nearly $9,859 per year between their expected family contribution, grants, and scholarships.

Proposals to make higher education more affordable often focus on reducing tuition costs and increasing need-based financial aid. Both of these options require a political commitment to expand state and federal funding for higher education. The budget priorities of President Joe Biden's administration pushed for expanding access to Pell Grants and increasing the maximum award amount available to recipients. The administration also championed moratoriums on federal student loan repayments and debt forgiveness measures targeting low- and middle-income borrowers, though these programs were challenged by Republicans and awaiting Supreme Court decisions as of March 2023.