Guest post: America Shows No Increase in College Graduation Rates over the last 30 Years

Guest post by Kenneth Thomas

America Shows No Increase in College Graduation Rates over the last 30 Years

Jared Bernstein (via Paul Krugman) highlights an amazing breakdown in the prospects for reducing economic inequality any time soon. Over the last 30 years, the U.S. has made no progress whatsoever in increasing college graduation rates. To be specific, 25-34 year olds in 2009 had a college degree rate of about 40%, almost exactly the same as for 55-64 year old baby boomers. In the meantime, other industrialized countries were racking up substantial gains, most spectacularly in the case of South Korea where a little over 10% of 55-64 year olds have college degrees, but more than 60% in the 25-34 age group do. If you want to understand how South Korea has gone from a poor developing country to an industrial powerhouse within our lifetimes, this is one big reason.

Here are the overall results for OECD and select non-OECD countries for the two periods:

As we can see, the U.S. has fallen from a tie for second with Canada among current OECD members (Russia is not a member) to 15th in the OECD. The big question is why this is happening. One major reason is rising college costs, which have far outstripped overall inflation.

Note: Average annual rate of growth of published prices in inflation-adjusted dollars over a 10-year period. For example, from 2000-01 to 2010-11, average published tuition and fees at private four-year colleges rose by an average of 3.0% per year beyond increases in the Consumer Price Index. See link above for further data on tuition and fees plus room and board.

View Notes and Sources

As we can see, the rate of cost increase for public four-year universities was the most rapid of all. One big reason for that, of course, is reduced state support of higher education. Citing State Higher Education Executive Officers, the National Conference of State Legislatures reports that state appropriations per student, at $6928 in fiscal year 2009, was more than $1000 below its FY 2001 peak, and lower in real terms “than in most years since FY 1980″ (p. 1).

As Bernstein argues, Pell grants are one way to offset this problem, and he points out that the Obama administration has strengthened the program. However, the Ryan budget would slash Pell grants, among many other programs, in order to fund a tax cut for millionaires of almost $400,000, per Bernstein.

As Alan Krueger noted in January, there is a strong relationship between higher inequality and lower social mobility. The OECD data show that the U.S. is making no progress on one of the most important tools for social mobility, college. If access to higher education in this country actually declines, as it is threatening to do, our inequality problem will become infinitely harder to solve.

crossposted with Middle Class Political Economist

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