Last month, The Institute for College Access & Success (TICAS) held its inaugural meeting of the State Policy Network to Advance Debt-Free College. In his opening remarks, Former U.S. Secretary of Education and now State University of New York (SUNY) Chancellor John B. King, Jr. did not mince words:
“The average debt of a graduating college student has increased 106 percent since 2007 in raw dollars and skyrocketed more than 40 percent faster than inflation. But to the college graduates entering the job market with their payment plan, the increase in the average debt owed might not be the scariest development. Because they might not mind if the salaries they received in return for incurring that debt were growing just as fast, or faster. But the debt-to-income ratio also increased dramatically over the past 15 years, with debt owed jumping from 40 percent of annual salary to 63 percent.”
Our debt-financed postsecondary education system is unsustainable. It has far-reaching implications for individuals, families, communities, colleges, employers, states, and the nation. Ultimately, if we want to have the strong families and talented workforce that America needs to prosper, we need to change how we invest in higher education.
Since its inception nearly two decades ago, TICAS has tracked the growing role of student debt in financing higher education – and the deepening challenges it creates. We have seen widening racial disparities in who gets a college degree – and persistent, deep divides by geography and family income. These disparities, which hinder wealth creation and economic growth, are here to stay unless we tackle college affordability.
TICAS is building on over a decade of work to establish a new federal-state partnership to better fund public higher education. One that builds upon the growth in both local and state promise programs. We feel that now is the time to bridge and sustain these efforts. How? By creating new federal legislation with a clear and understandable affordability guarantee for students and families as its cornerstone.
The main question before the TICAS State Policy Network to Advance Debt-Free College is simple: How do we create affordability at the point of enrollment for our lowest-income state residents?
We have brought together governors’ policy advisors, state legislators, and state higher education executives from 12 states to help us answer this question and inform what a new partnership between states and the federal government might look like.
There are at least three reasons why these conversations are so essential to have at this moment, not just for students and families and colleges, but for local, state, and federal policymakers as well as employers.
To prepare for the significant, ongoing demographic changes. Regardless of whether state K-12 student populations are expanding or contracting, the Western Interstate Commission on Higher Education projects that by 2025, there will be more Black, Latino, and multiracial students coming out of high school in every state. We also know that among today’s learners, 25 percent are age 25 or older, half are financially independent and are relying on their own income, 25 percent are parenting while learning, almost 60 percent are first generation, and almost 85 percent live off-campus. These proportions are staggering given the roughly 20 million students in college.
To reverse enrollment declines. While enrollments are returning to pre-pandemic levels in pockets across the country, enrollments in most states have not rebounded to what they were after the Great Recession. State leaders already recognize that they must increase the number of recent high school graduates going to college, particularly students of color. They are also working to reengage the 40 million adults who attempted but did not complete college. But more attention needs to be paid to the millions of adults who never went to college and would benefit greatly from higher education to advance in their careers.
To address income inequality and what it means for college and the workforce. The growth in income inequality threatens our nation’s ability to meet future economic and workforce imperatives. Increasingly, the pathway out of poverty, into the middle class, and towards wealth creation requires individuals to earn postsecondary credentials. By 2031, over 7 out of 10 jobs will require a postsecondary credential of value. Jobs for individuals with a high school diploma have been declining since the Great Recession. While jobs for individuals with a high school diploma or less will continue to be a part of our economy, we must acknowledge that the employment and earnings outcomes associated with these jobs are less likely to equip individuals to enter the middle class or to allow them to support postsecondary education for their children.
We can no longer assume that economic downturns will automatically translate into millions of Americans turning to postsecondary education to skill, reskill, or upskill. That’s why we cannot continue to expect individuals—especially the most financially vulnerable—to assume the highest burden and risk to acquire the postsecondary credentials that employers are demanding. We also cannot expect our public colleges and universities—especially the community colleges, rural serving institutions, regional comprehensive universities, and minority serving institutions that enroll 86 percent of all the students attending public institutions—to continue to serve larger proportions of underrepresented populations without increased dedicated and coordinated financial resources.
State and local leaders have been leading the way to equip individuals with the postsecondary education they need to help communities thrive. But they know that as long as economic downturns, natural disasters, pandemics, and other emergencies and shocks continue to upend our local, regional, and state economies, greater engagement and coordination with the federal government is necessary so that states can continue their momentum unabated.
Chancellor King noted that higher education has the potential to become the “preeminent engine of upward mobility” for all that it has long promised to be. We must realize this potential—together—especially for millions of Americans from low-income families and racially marginalized groups. At TICAS, we find it hard to believe that Congress has not yet created a federal-state partnership to finance postsecondary education. That’s why we are honored to work with our network members who stand ready to engage with our federal policymaker colleagues to design a partnership that meets the challenges of our time.
This blog was written by Tanya I. Garcia, Senior Advisor for TICAS, with special thanks to Chancellor John B. King, Jr. and the State University of New York.