Demography and Affordability Collide

The South's two-year and four-year institutions of higher learning enrolled 5.5 million students in 2003 -- the highest level ever. Growing numbers of the South's Hispanic, African-American and female residents today are pursuing post-secondary education.

At first glance, these trends -- detailed in a new report by the Southern Regional Education Board (SREB) -- seem promising for a region that historically has had low college enrollment rates and that must improve the educational levels of its African-American and Hispanic residents in order to remain economically vibrant.

Yet upon closer inspection, these trends are offset by the soaring cost of college education. In-state tuition and mandatory fees at the South's public four-year colleges jumped by 62 percent (adjusting for inflation) between 1994 and 2004. At two-year colleges, tuition and fees rose by 56 percent over the same period. These increases have become especially burdensome for middle- and lower-income students -- groups who could realize significant gains from higher education.

SREB estimates that a student from a median income family in the South who enrolls in a four-year institution faces an "affordability gap" of $3,350, after subtracting an expected family contribution, a federal Pell Grant and education tax credit from the cost of attendance. At a two-year college, the gap equals $1,350. The affordability gap is even greater for students from families with incomes below the federal poverty level. In response to these gaps, students turn to borrowing, which increases the cost of college, or, in some cases, forsake higher education all together.

These trends point to a "coming collision between demographic trends and the affordability gap." As SREB observes,

"Faster-growing portions of the population mean that middle- and lower-income students will be more and more the norm among college students in coming decades ... Efforts to ensure that affordable college opportunities are available to all students will be an increasingly important and difficult challenge."