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The Big Squeeze: College Students
Dig Deeper as Idaho Higher Education Funding Falls
October, 2014
Idahoans have long valued public higher education, recognizing its importance to the economy and social fabric of the entire state. In fact, the territorial legislature founded the University of Idaho in 1889, before Idaho was admitted as a state. But over the past three decades, higher education funding from the legislature has declined relative to costs for public education. ese cuts in state funding are a depar- ture from Idaho’s historic commitment to higher education.1 e result has been steeply rising tuition and fees, a growing debt load for many students,
and higher barriers to attending college for middle- and low-income Idahoans. is is a direct threat
to Idaho’s economy at a time when employers are demanding a more educated workforce, and when workers with a college degree command far higher salaries than those with just a high school diploma.
Idaho’s prosperity depends on lawmakers reversing this trend and devoting necessary resources to the state’s colleges and universities. ey should also help ensure that postsecondary education is acces- sible to students from all economic backgrounds.
Higher Education is Critical to Idaho’s Future Economy
Idaho has disinvested in higher education despite the growing need for a well-educated, highly skilled workforce to strengthen our economy. In May 2014, Idaho Business for Education, a group of 80 businesses from across the state, sounded the alarm in a report highlighting the mismatch between the education level of Idaho’s workforce and the types of skills that will be required for jobs in the future.2 A Georgetown University study estimated that 68 percent of jobs in Idaho will require a postsecond- ary credential by 2018.3 e Idaho State Board of
Education set a goal of having 60 percent of Idaho’s 25-34 year olds earn a post-secondary education by 2020.4 Currently only 35 percent have a degree, and it’s hard to see how the state will meet its goals if we continue to invest less in higher education.5
Higher levels of education result in higher earnings. In 2012, the median annual salary for young adults with a bachelor’s degree was $46,900 in the United States, compared to $30,000 for those who only completed high school.6
As Costs Rise for Idaho Students, College Enrollment is at Risk
As a result of reduced state support, the cost of a college education has shifted dramatically, with students and their families shouldering a growing share of the burden. is makes higher education increasingly una ordable, and forces students to take on bigger debts to fund their schooling. Stu- dents from lower-income households will continue
100% 80% 60% 40% 20%
0%
Idaho Center for Fiscal Policy
to face increasingly tough choices between getting a degree and taking on enormous debt, or not attend- ing college. And while attending a four-year public institution in Idaho is still more a ordable than in Nevada, Oregon and Washington, it is more expen- sive than Montana, Utah, and Wyoming.7
e portion of Idaho high school graduates who enroll directly in college is already low and that
rate is declining, despite a robust e ort by the J. A. and Kathryn Albertson Foundation to encourage enrollment.8 Fifty-two percent of Idaho high school seniors enrolled in college in 2013, down from 54 percent in 2012. In two of Idaho’s largest school districts, West Ada and Boise, rates declined by 9 percent and 3 percent, respectively.9
Once they enrolled, it is important that students are able to stay the course. Idaho’s completion rate at four-year public institutions over a six-year period
is 41 percent, compared to a national average of 63 percent.10 With just over half of Idaho students go- ing on to college and less than half completing four- year degrees, particular attention should be paid to making sure college is a ordable.
Troubling New Trends in Higher Education Investment
Over the past few decades, there has been a stark shift in how we support higher education. Tuition and fees now account for 47 percent of college and university funding, up from 7 percent in 1980. State funding dropped to 53 percent from 93 percent of the cost over the same period. (See Table 1.)
Idaho’s tuition and fees have grown rapidly, even when adjusted for in ation. At $5,932, the average
in ation-adjusted cost of a year of education was almost ve times higher in 2013 than it was in 1980 at $1,215. (See Table 2 for in ation-adjusted tuition and fees over time.)
Idaho Cut More Deeply Than Other States in Recent Years
Idaho has cut funding to public colleges and univer- sities by a greater percentage than all but ve other states since the Great Recession (Arizona, Louisiana, South Carolina, Oregon, and Alabama). Funding
is down by 36.8 percent in Idaho since 2008, a de- crease of $3,857 per student (adjusted for in ation). e average tuition at a public, four-year college
in Idaho has increased by 28.5 percent during this period and students are paying $1,401 more per year.11 ese tuition increases force students to take on more debt. Idaho’s low four-year degree comple- tion rates may re ect that the debt burden for many students is too high.
From a historical perspective, it is evident that Idaho’s commitment to higher education funding has declined signi cantly, and this trend is occur- ring at a time when workers with college degrees or other form of post-secondary education are more in demand than ever. Companies looking to expand or relocate put a premium on how skilled a state’s workforce is.
Over the past three-decades, the tuition and fees
for students has increased by nearly ve-fold, when adjusted for in ation. ese trends may under- mine our capacity to build a strong and sustain- able economy in Idaho for the long-term. If Idaho doesn’t want to fall further behind economically, stakeholders, including business leaders and associa-
Idaho Center for Fiscal Policy
tions, elected o cials, researchers, and university leaders from across the state need to work to reverse this trend. Together we can develop a long-range plan to achieve the educational goals and fund-
ing approaches for the higher education of Idaho’s future workforce to create the economic prosperity that Idaho deserves.
Data Sources:
Tables 1 and Chart 1: Idaho State Board of Education, unpub- lished data
Table 2: Idaho State Board of Education, unpublished data and U.S. Department of Labor, Bureau of Labor Statistics
Endnotes:
1. is report speci cally examines the impact of state fund- ing declines for four-year public institutions in Idaho. Certi cates from two-year, community colleges provide an alternative option for higher education certi cation that can lead to a four-year degree.
2. Idaho Business for Education, “Educated Workforce: e Lifeblood of Idaho Business,” May 2014. http://www.ida- hobe.org/wp-content/uploads/2014/05/WORKFORCE- STUDY-FINAL.pdf.
Idaho Center for Fiscal Policy
3.
4. 5.
In 1980, students and families paid about 7% of the cost of Higher Ed.
By 2013, students and families paid nearly 47%.
State Supported No State Support
Carnevale, Anthony P., Smith, Nicole, Strohl, Je . “ e College Advantage: Weathering the Economic Storm,” e Georgetown Public Policy Institute, 2013, http:// www.idahobe.org/wp-content/uploads/2014/05/WORK- FORCE-STUDY-FINAL.pdf.
Idaho State Board of Education, “2013 Fact Sheet,”
http://www.boardofed.idaho.gov/research_stats/docu- ments/fact-sheet/2013/fact-book-2013- nal-web.pdf.
KIDS COUNT Data Center: http://datacenter. kidscount.org/data/tables/6294-educational-attain- ment-of-population-ages-25-to-34#detailed/2/14/fal
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