Chasing the College Dream in Hard Economic Times. Issue Brief

Slow economic growth in the past several years has strained the financial resources of many American families and heightened financial burdens for families hoping to support their children's college education. These economic struggles come at a critical time for high school students who rely on family resources to fund large portions of college expenses. This study focuses on how the economic downturn has affected the family financial resources of high school students and their cost of attending college. The primary data source is the US Census Bureau's American Community Survey (ACS) for 2006 through 2012.13 The ACS provides detailed annual data on high school students and their families. The report also uses information on student race/ethnicity to assess whether the economic slowdown had a differential effect on some groups of students. Alternative estimates of college tuition costs are drawn from the US Department of Education's Integrated Postsecondary Education Data System (IPEDS), the College Board, and the US Bureau of Labor Statistics (BLS). Finally, annual college enrollment rates are drawn from the ACS. This study tracks family finances and tuition from the period before the Great Recession through the continuing economic slowdown in 2012. Findings indicate that despite more limited resources, more families--including minority families who on average have lower family incomes--opted to send their student to college. This suggests that efforts to increase information and access to financial aid have been moderately successful at offsetting some of the effects of the economic downturn. More research is needed to determine how the recession has affected the institutions students chose. For example, although enrollment rates rose, students may be opting for less-expensive schools, such as two-year institutions instead of four-year institutions, public universities instead of private ones, or colleges closer to home.