This week the Education Trust released a report which suggests institutions that serve similar student populations may have very different outcomes for Pell Grant recipients.
The report gathered Pell grant data from state higher education systems and the data institutions report to U.S. News & World Report.
The report discovered that though some institutions may serve similar student populations the outcomes for Pell Grant recipients could greatly differ. In addition, beyond graduation rates for Pell Grant recipients among similar institutions, the report also showed gaps on the same campus between Pell Grant recipients and their non-Pell peers.
A recent survey shows that a majority of young people entering the workforce want employers to help them pay off their college loans.
Iontuition, Inc. surveyed 1,000 students who are either planning on attending, currently enrolled, or recently graduated from a college or university. Of those surveyed, three-quarters noted they would prefer to work for an employer that offers student loan repayment matching as part of a benefits package. In addition, more than half of those surveyed noted they would rather benefits focus on student loan repayment assistance versus health care or a 401(k) plan.
Only a handful of employers currently offer loan repayment assistance for employees. Employees of government agencies or nonprofits designated as tax exempt by the IRS may be eligible, and certain professions may qualify for loan prepayment options.
This week bipartisan legislation passed the U.S. House of Representatives to extend the Federal Perkins Loan Program.
The Higher Education Extension Act of 2015 extends the Federal Perkins Loan Program for one year and adds a one-year extension to two advisory committees – the Advisory Committee on Student Financial Assistance and the National Advisory Committee on Institutional Quality Integrity.
The one-year extension would extend the authority to make loans under Perkins until September 30, 2016. Students who receive a Perkins loan during the 2015-2016 award year and remain in the same academic program will be eligible to receive loans through March 31, 2018.
In the last year headlines about the student loan “crisis” have spurred new conversations about student loans, borrowers, and higher education. This has allowed for the opportunity for policymakers, institutions, stakeholders and families to unpack the data and increase awareness and literacy around the issue.
Recently The Brookings Institute released a paper that examines new data from the National Student Loan Data System (NSLDS) on 4 percent of all federal student borrowers since 1970 (approximately 46 million annual updates on 4 million borrowers). The analysis is the first to analyze debt burdens by linking them to earnings information from federal tax records.
It is important to note that the NSLDS database is imperfect; however, with that caveat the analysis of the data shows that the student loan crisis may not be a crisis for all.
According to the paper, the concerns about student debt and default are largely concentrated among non-traditional borrowers attending for-profit and other non-selective institutions. The paper points to increased enrollment and borrowing rates for much of the increase in default rates with changes in type of schools attended, debt burdens and labor market outcomes of non-traditional borrowers explaining the change.
While the paper echoes other findings regarding higher default rates of students who borrow more than their eventual earnings, the analysis also opens the door to some new questions in what is becoming an increasingly complex story around student loans. For example, the data shows that borrowers whose federal loans came due in 2010, 2011 and 2012 collectively owed more on that debt two years after they first entered repayment. Borrower’s loan balances had never before increased in this way according to data dating to 1970. This is a first for the federal student loan program, where historically borrowers had paid down at least a portion of their debt in the two years after graduation. Another issue raised by the analysis is how the U.S. Department of Education’s loan servicers counsel borrowers on their repayment options and collect their monthly payments.
The paper does not take the step to explain these insights, but it does continue the conversation and the importance of unpacking the student loan crisis beyond the headlines.
The National Center on Education Statistics released three reports this week that provide data on Pell Grant recipients and trends in undergraduate nonfederal aid, which includes state, institutional and employer aid.
- Demographic and Enrollment Characteristics of Nontraditional Undergraduates: 2011-12
- Trends in Pell Grant Receipt and the Characteristics of Pell Grant Recipients: Selected Years 1999-2000 to 2011-12
- Trends in Undergraduate Nonfederal Grant and Scholarship Aid by Demographic and Enrollment Characteristics, Selected Years: 1999-2000 to 2011-12
Between 1999-2000 and 2011-12:
- Nearly 71% of undergraduates in the U.S. (excluding Puerto Rico) received some form of aid in 2011-12, a significant jump from just 54.6 in 1999-2000.
- In the public-four year sector the percentage of undergraduates who received aid at public four-year institutions was 73.9% in 2011-12 and 62.6% in 1999-2000.
- Of those students who received aid 60.3% received federal aid in 2011-12 (46.9 % in 1999-2000) and 46.8% received nonfederal aid (40.6% in 1999-2000).
- The majority of students who received nonfederal aid received state aid (22.7%), followed by institutional aid (21.5%) and employer aid (5.9%).
- Students who received a Pell Grant increased from 21.8% to 41.3%. In the public four-year sector student recipients increased from 24.1% to 38%.
- The average Pell Grant award in the United States increased from $1,900 to $3,400, in current dollars, not adjusting for inflation.
The U.S. Senate Republicans released a continuing resolution (CR) today to extend funding for the federal government.
With the end of the federal fiscal year looming on September 30 the CR would continue current federal funding levels through December 11. If passed, Congress would work towards an agreement on a broader budget plan to fund the government for the remainder of the fiscal year.
Without congressional action by the end of the month, the government will shut down on October 1. It is worth noting that federal student aid programs are forward funded, meaning current negotiations over spending levels for fiscal year 2016 would affect award year 2016-17. However, certain functions administered by the Department of Education may be affected.
This week U.S. Senator Barbara Boxer (D-CA) and U.S. Representative Bobby Scott (D-VA) introduced legislation that would restore Pell eligibility to students who had their loans discharged through compromise and settlement authority, defenses to repayment, or statutory discharges or for students who would qualify under these provisions if they had taken out a federal student loan.
The Pell Grant Restoration Act of 2015 has 40 co-sponsors in the U.S. House and seven in the U.S. Senate.