Analysis reveals low-income students are working more due to increasing college expenses

The rising cost of college tuition is a significant concern for many families, especially those from lower-income backgrounds. A recent analysis from the Brookings Institution sheds light on how different income groups are coping with these increasing costs. According to the analysis, lower-income students are working more hours to cover the rising net cost of college, while middle- and upper-income families are taking out more loans.

Phil Levine, a Nonresident Senior Fellow at the Brookings Institution and an economics professor at Wellesley College, found that well-off families are drawing more on savings and earnings to keep up with rising college costs. On the other hand, lower-income students, who may not have the family resources to cover these costs, are increasing the amount they work. By 2008, three-fourths of lower-income students were working and averaging 20 hours per week or more.

One of the main reasons why lower-income students are working more is due to their limited financial options for meeting college costs. Their families may have limited earnings to contribute, making it difficult to take out more debt or obtain loans. As a result, working more may be the only viable alternative for these students. In contrast, higher-income families have a greater capacity to pay for college costs from income, savings, or loans.

From 1996 to 2008, students from families making less than $50,000 took on an additional 2.5 hours of work per week on average. However, the impact of working long hours on students’ success cannot be ignored. Research cited by Levine shows that students who work 20 hours a week or more may experience negative effects on their academic outcomes, such as grades and credits earned.

Middle- and higher-income families, on the other hand, have more earnings and resources to pay for the increasing college costs, which have risen by $5,000 to $10,000 per year compared to the mid-1990s. While these families may be able to afford these higher payments, it could potentially harm their longer-term financial stability.

In conclusion, the analysis from the Brookings Institution highlights the disparities in how different income groups are coping with the rising cost of college tuition. While lower-income students are working more to cover these costs, middle- and upper-income families are relying on savings, earnings, and loans. It is essential for policymakers and institutions to address these financial challenges to ensure that all students have equal access to higher education.