Public universities are in trouble. The COVID-19 pandemic is set to blow a hole in state budgets across the country, and legislators will surely balance the books, as they always do, by cutting funding for public higher education. A recent Brookings Institution analysis warns against this move, arguing that public colleges and universities are the “workhorses” of economic mobility.
Read carefully, however, and it appears the authors have buried the lead.
It is true that public universities generate a great deal of economic mobility (students moving from low-income families into the middle class and higher), and that is good news. But policymakers should not mistake that finding for evidence that these institutions are better at creating economic mobility than private colleges. They aren’t — at least, not according to the statistics presented in the Brookings analysis.
The Brookings analysis shows that public four-year institutions create economic mobility that is less than what we would expect based simply on the share of students they enroll. They account for 78% of low-income students enrolled at four-year institutions but are responsible for producing only 71% of the students that reach the highest income quintile by the time they reach their early 30s.
Private nonprofit institutions, on the other hand, punch well above their weight when it comes to moving students up the income ladder. Based on the same data, private nonprofit institutions enroll 22% of low-income students at four-year universities but account for 29% of all students that move up to the highest income quintile. That accomplishment looks every bit as remarkable (if not more) as the point the Brookings analysis makes about public institutions. The authors leave readers to reach that conclusion on their own, however.
That is a common problem. Policy discussions often turn a blind eye to the successes of private colleges in creating opportunities for disadvantaged students. This is understandable given that journalists and liberal advocates tend to paint these institutions as expensive and exclusive clubs for students from wealthy families. In reality, these institutions are powerful engines of opportunity.
According to Department of Education data, nearly 1 in 4 bachelor’s degree students from families earning less than $50,000 attend a private college or university. And the student bodies at private institutions are more economically diverse than is commonly understood. About 44% of students at private four-year institutions come from families with income below $50,000. At public institutions, the figure is only slightly higher at 51%.
Many observers may be surprised that private colleges enroll so many low- and middle-income students given their notoriously high tuition prices. But generous financial aid packages from the universities themselves and portable vouchers from government programs, such as the Pell Grant, can make these universities nearly as affordable as public ones. In the 2015-16 academic year, full-time students from families earning less than $50,000 who attended private universities received an average of $15,700 in annual grants and scholarships, nearly double what students from this income group received at public institutions.
The recent Brookings analysis is largely an appeal to policymakers to maintain funding for public colleges given their contributions to economic mobility. There’s nothing wrong with that rationale, per se. But by the same logic, one could argue that the financial problems many small private colleges face due to the pandemic are even more worthy of emergency government assistance. After all, the argument implicit in the analysis is that if we had more private colleges, students would achieve more economic mobility.
Jason D. Delisle (@delislealleges) is a resident fellow at the American Enterprise Institute. Cody Christensen (@SeeChristensen) is a doctoral student and former research associate at the American Enterprise Institute.
