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Increasing Family Wealth and College Enrollment

May 18, 2012

Filed under: Education,Income & Working Families — Tags: college degree, Community Development Financial Institutions, low-income, Mississippi, Pew Charitable Trusts, post-secondary education — admin @ 1:13 PM

Enrolling in college and receiving a college degree became increasingly necessary for moving up the economic ladder and reaching reliable employment and sufficient wages. A family’s income affects the likelihood a recent high school graduate will enroll in college. But what about a family’s household wealth or assets? Findings from the Pew Charitable Trusts indicate that increases in a family’s wealth during high school years, as measured by changes in the value of their home, raise a student’s likelihood of enrolling in college.

The chart shows college enrollment rates among students living in low- and middle-income families by the family’s home equity. For low-income families, having home equity at $35,000 (the 25^th percentile) increased the college attendance rate from 9% to 29%. Enrollment rates rise to 52% when a low-income family’s home equity is $75,000 (50^th percentile). Students from middle-income families also experience an increase in college enrollment as home equity rises.

Housing wealth could influence a student’s likelihood of enrolling in college for many reasons. The Pew report suggests that increases in housing wealth may affect college enrollment decisions because families use their wealth to directly finance education. Housing wealth could also indicate that a family has additional resources to set aside in a college savings account. It is also possible that families feel more economically secure, and open to helping their children navigate the path to applying for student loans to pay for a college education.

Low-wealth families may encounter more financial hurdles to supporting their children on the path to enrolling in post-secondary education. Efforts that promote wealth building among low and middle-income families and that support families in saving for a child’s education can lift more of Mississippi’s students to college enrollment and success.

Along with support for college savings, Community Development Financial Institutions (CDFIs) can connect underserved populations with a path to homeownership that builds wealth and home equity. Many CDFIs serve mortgage customers that are low- to moderate-income borrowers and first-time homeowners.

Supporting Mississippi’s families in accumulating college savings and broader wealth can lead to greater financial stability. Ultimately, these savings will result in an increased likelihood that more of Mississippi’s students pursue college courses and gain employment that allows them to save for their own families someday.

Read more on how home equity affects a student’s college decisions.

Author: Sarah Welker, Policy Analyst

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Family Income and the Decision to Attend College

May 17, 2012

Filed under: Uncategorized — admin @ 10:03 AM

Recently, the MEPC blog looked at the gains Mississippi stands to realize from increasing college credential attainment among students. The next few posts investigate which of Mississippi’s students are more likely to pursue higher education and which may need more resources and support as the state seeks to raise educational attainment among its workforce.

Nationally, students from low and moderate-income families are less likely to enroll in post-secondary education and attend top-rated public universities than their higher-income counterparts. The chart shows that 56% of high school graduates from low-income families (income under $25,000) are not enrolled in post-secondary education within 2 years of graduating. In comparison, 26% of students from families with income between $75,000 and $125,000 are not enrolled in higher education.

Students from low-income families are also less likely to attend their state’s flagship university or a private university. For this graphic, flagship universities would include schools like the University of Mississippi, University of Virginia or University of Texas. These campuses often attract a state’s top-tier students and have higher rates of graduation and persistence than other 4-year campuses in the state.

The relationship between income and educational outcomes and post-secondary attendance is well documented. These findings from a report by the Pew Charitable Trusts illustrate how a family’s income is related to a student’s likelihood of attending college, related to the institution they attend, and ultimately can be related to their likelihood of persisting in school.

Understanding these relationships is particularly important in Mississippi where 1 in 3 children grow up in a household with income below the poverty level, and half the state’s African American children live in impoverished households.

Thousands of Mississippi’s high school students and adults need stronger financial aid and resources for support with applying for and enrolling in higher education. These resources are important for ensuring more students receive the post-secondary credentials that are critical to individual economic mobility and the state’s long-term advancement and prosperity.

Part 2. A family’s wealth is measured by the savings and assets they accumulate over time and is distinct from income. A family’s wealth may also affect student decisions related to post-secondary education. MEPC’s next post will explore the relationship between changes in household wealth and college attendance decisions

Author: Sarah Welker, Policy Analyst

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Part 2: WHAT ARE THE REAL RETURNS FROM POST-SECONDARY CREDENTIALS?

May 11, 2012

Filed under: Education,Income & Working Families,Workforce — Tags: Mississippi, The Center on Law and Social Policy — admin @ 9:12 AM

Yesterday, the MEPC blog looked at earnings gains that Mississippians experience from receiving a post-secondary degree. The post determined that persisting to a college degree can have real effects on wages for individuals and families.

In fact, the returns Mississippians experience from pursuing a community college certificate, 2-year degree or 4-year degree are above 23 other states. The Center on Law and Social Policy (CLASP) looked at the personal income gains in each state from students attaining an additional 100 certificates, 100 associate’s degrees and 100 bachelor’s degrees. Mississippi ranked 27^thin personal income growth associated with these credential additions (see chart).

Gains from increasing credential attainment don’t just affect the individual. Increasing credential attainment also benefits families, employers and the state’s revenue generation. Mississippi also ranks even higher (19^th) for state revenue increases from adding 100 certificates, associate’s degrees and bachelor’s degrees (see chart).

As a state, Mississippi stands to experience above average returns to contributions that increase post-secondary credential attainment among its citizens. The findings emphasize the need for steps that increase state revenue, so funding to higher education isn’t limited, tuitions don’t rise as rapidly as in recent years, and students aren’t faced with additional barriers in their desire for higher education. Unfortunately, Mississippi currently faces the opposite scenario.

Without a balanced approach that considers pathways to raising additional public revenue, the state is at risk of not reaping the full returns available to its residents and state resources from increasing post-secondary credential attainment.

Author: Sarah Welker, Policy Analyst
Source: Center on Law and Social Policy. The Credential Differential: The Public Return to Increasing Postsecondary Credential Attainment. Webinar on April 26, 2012.

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WHAT ARE THE REAL RETURNS FROM POST-SECONDARY CREDENTIALS?

May 10, 2012

Filed under: Education,Income & Working Families,Workforce — Tags: Center on Law and Social Policy (CLASP), Economic Security, higher education, Mississippi, post-secondary degree, workers — admin @ 2:05 PM

Last week MEPC’s blog introduced a new tool that looks at the returns on investment adults and the state receive from increasing post-secondary degree and credential attainment among residents.

MEPC regularly recommends increasing resources for higher education, so adults have smoother, better supported pathways to success in higher education and the workforce. An analysis by the Center on Law and Social Policy (CLASP) affirms the importance of bolstering these investments and shows the value to Mississippians receiving the credentials and the state overall.

Let’s start on the individual level. The chart below compares the difference in earnings between adults with a high school degree, associate’s degree and bachelor’s degree. It is not surprising that Mississippi falls below average for earnings for adults with a bachelor’s degree. However, what the chart also shows is substantial space between Mississippi’s adults with a high school degree, associate’s degree and bachelor’s degree. The space between the earnings by educational attainment reveals that Mississippi workers experience notable wage increases through pursuing education.

Higher education continues to be a pathway for increasing economic security of individuals. However, gains from increasing credential attainment don’t just affect the individual. Increasing credential attainment also benefits families, employers and the state’s revenue generation.

Tomorrow’s post will compare the returns in personal and state income Mississippi experiences from increasing college credential attainment to the returns in other states across the U.S.

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JOB WATCH: Employment Since the End of the Recession

May 8, 2012

Filed under: Income & Working Families,Jobs,Unemployment,Workforce — Tags: employment, job market, Jobs, SNAP — admin @ 8:02 AM

Last week the jobs report revealed that the U.S. added a modest 115,000 in April 2012. The nation’s unemployment rate ticked down slightly to 8.1%. While Mississippi’s employment numbers have not been released yet for April, this post reviews longer-term trends in jobs across the state.

From the beginning to the end of the recession, Mississippi lost 5.5% of all its jobs, equal to approximately 64,000 jobs. Since the recession ended in June 2009, job loss has tempered, but Mississippi has still seen overall employment fall by 0.5% (see chart).

In comparison, the United States saw overall employment decline by 5.4% during the recession, and total employment has risen by 1.8% since June 2009. The disparities in job growth since the end of the recession signal that Mississippi’s recovery is progressing slower than the nation. Mississippi also trails the South overall where employment has expanded by 2.4% since the summer of 2009.

Additionally, the state’s job market in 2011 now appears to be weaker than originally projected. Data on Mississippi’s overall employment shows Mississippi’s employment down slightly from a year ago.

A more extended look at Mississippi’s employment history underscores that substantial job additions have not occurred since the recession ended, and Mississippi falls behind the region and nation which are experiencing weak growth. The findings also illustrate that thousands of Mississippi families continue to seek resources in the wake of job loss and financial hardship. Calls to cut critical programs like SNAP, as highlighted in last week’s post, risk further harming workers and families who have lost jobs and are struggling to find employment in communities across the state.

Author: Sarah Welker, Policy Analyst
Source: Bureau of Labor Statistics. Current Establishment Survey. Jobs in thousands.

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House Committee Proposal Cuts SNAP

May 4, 2012

Filed under: Food Insecurity,Income & Working Families,SNAP — Tags: SNAP — admin @ 1:07 PM

Last month, the House Agricultural Committee voted to cut the federal food stamp program, also known as the Supplemental Nutrition Assistance Program (SNAP). This proposal would cut SNAP by more than $33 billion over the next ten years, and if turned into law, would affect virtually all SNAP households in the United States.

SNAP provides short-term, monthly assistance to millions of low-income families to help put food on the table. In February 2012, there were over 46 million people participating in SNAP and over 650,000 SNAP participants in Mississippi (USDA: Food and Nutrition Service, 2012). According to the Center on Budget and Policy Priorities (CBPP) (2012), approximately 2 million individuals would lose SNAP benefits completely, while the remaining 44 million would have reduced benefits, as a result of the proposed budget cut.

Source: USDA: Food and Nutrition Service. (2012, April). Building a healthy America: A profile of the Supplemental Nutrition Assistance Program. Retrieved from http://www.fns.usda.gov/ORA/menu/Published/SNAP/FILES/Other/BuildingHealthyAmerica.pdf

The Committee’s proposal would also eliminate Broad-Based Categorical Eligibility, requiring states to reinstate the asset test for SNAP eligibility. Under Broad-Based Categorical Eligibility, nearly all households become categorically eligible for SNAP if they receive non-cash Temporary Assistance for Needy Families (TANF) or maintenance of effort (MOE) funded benefit or service, such as an informational pamphlet or 800-number (USDA: Food and Nutrition Service, 2011).

Broad-Based Categorical Eligibility provides the opportunity for low-income people to build the savings they need while receiving short-term benefits. However, reinstating the asset test would limit SNAP benefits to low-income people with no or few assets, making it increasingly more difficult for people to become eligible for SNAP.

Likewise, this proposal would remove approximately $8 billion from the economy from the last quarter of 2012 through 2013 (CPBB, 2012). Importantly, SNAP puts money directly into the economy when times are tough. People spend SNAP assistance quickly and locally supporting grocers and other economic activity. When SNAP benefits are reduced, local small businesses are hurt as well.

As a result, Congress should take a balanced approach in protecting both the nation’s economic security, its small businesses and the millions of families who are struggling with poverty. Policies like Broad-Based Categorical Eligibility should be protected rather than eliminated, as they provide a safety net for low-income Mississippians to save and build assets while they work their way toward financial stability.

Author: Jessica Shapley, Policy Analyst

Sources:
CPBB. (2012, April 18). House Agricultural Committee proposal would cut 2 million people off food stamps, reduce benefits for more than 44 million others. Retrieved from http://www.cbpp.org/cms/index.cfm?fa=view&id=3749
USDA: Food and Nutrition Service. (2011, Jan 30). Questions and answers on Broad-Based Categorical Eligibility. Retrieved from http://www.fns.usda.gov/snap/rules/Memo/2011/013111.pdf
USDA: Food and Nutrition Service. (2012, April). Building a healthy America: A profile of the Supplemental Nutrition Assistance Program. Retrieved from http://www.fns.usda.gov/ORA/menu/Published/SNAP/FILES/Other/BuildingHealthyAmerica.pdf
USDA: Food and Nutrition Service. (2012, April 30). Supplemental Nutrition Assistance Program: Number of persons participating – one month change. Retrieved from http://frac.org/wp-content/uploads/2011/01/snapdata2012_february.pdf

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Mississippi’s Graduation Rate Task Force Goals for Increasing Degree Attainment

May 2, 2012

Filed under: College,Education,Income & Working Families,Workforce — Tags: degree attainment, graduation rate, Graduation Rate Task Force, Mississippi, post-secondary, Workforce — admin @ 9:55 AM

In 2009 Mississippi’s Graduation Rate Task Force developed long-term goals for increasing the number of Mississippi adults with a postsecondary degree. The Task Force outlined that they wanted to reach the national rate for degree attainment by 2025 which means raising the portion of Mississippi’s residents with a post-secondary degree to 46.5%. Currently, 29.9% of working-age adults hold a post-secondary degree.

To reach the Task Force goal, Mississippi needs to connect close to 150,000 additional residents with a 2 or 4 –year degree beyond the current rate of degree attainment, equal to an additional 950 and 1,000 graduates each year.

What different levers can contribute to increasing the rate at which Mississippi’s students attain degrees?

A new tool from the Center on Law and Social Policy (CLASP) explores what factors can raise the portion of residents earning a credential. By setting a “2025 College Attainment Goal” at 46.5%, individuals can move “bars” for Mississippi’s high school graduation rate, the college-going rate and portion of adults enrolling in college to see how increasing each one contributes to more degrees earned.

Meeting the Graduation Task Force goal will also mean increasing the number of students that persist to graduation. Individuals can also explore how increasing the rate at which students earn credentials at two and four-year colleges will also be necessary to advance the state to its goal.

The tool also demonstrates the return on investment that comes from increasing college graduates including: increased per capita earnings, increased state revenue and decreased state spending.

While the data are estimates, CLASP’s tool provides a starting point for conversation about advancements still needed in Mississippi’s post-secondary education system. Ensuring the success of adult students will be a critical part of attaining the 2025 goal. Considering non-traditional student needs in program design, support services and curriculum development is critical for raising the number of prepared adults in Mississippi’s workforce and raising the state’s competitiveness and prosperity in the years ahead.

Read more on the returns of increasing credential attainment in Mississippi.
Author: Sarah Welker, Policy Analyst

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MISSISSIPPI UNIVERSITIES AND THE GREAT COST SHIFT

April 30, 2012

Filed under: Income & Working Families,Institutions of Higher Learning,Race,tuition,University Costs — admin @ 7:46 AM

Recently, both the cost of higher education and student loans have been elevated to the nation’s attention. Here in Mississippi, funding for higher education is in focus as legislators make appropriation decisions for the upcoming year.

A new report, The Great Cost Shift: How Higher Education Cuts Undermine the Future Middle Class reviews how changes in funding for higher education over the last two decades have affected students and households across the country. This report examines how state disinvestment in public higher education over twenty years has shifted costs to students and their families.

This cost shift to families and students is evident in Mississippi as well as universities plan to raise tuition over the next two years to help cover costs and fill gaps in funding in the wake of growing enrollment and capped state funding.

As is seen nationally, the change in the balance of funding for higher education has come as Mississippi’s university student population is growing and becoming more diverse racially and economically. Over the last 15 years, the number of minority students enrolling in Mississippi’s universities has grown substantially (see chart).

At the same time, the number of students accessing Pell grants to support some of their education costs is rising. In 2009, more than 24,000 university students received some level of Pell grant funding.

In addition, more than half of Mississippi’s public 4-year university students now take out student loans to finance a portion of their education.¹

As noted in the report, as Mississippi’s university student population shifts, so, too, do the needs of students. First generation college students, students in need of remediation, or non-traditional students who are working while in school are just a few groups that may need extra support and resources as they move through higher education.

Mississippi and other states face the challenge of meeting these varied needs in a financial climate of scarcity that has persisted for a number of years. Recognizing the changing student needs –in both financial and academic support- is critical for also allocating sufficient funding to Mississippi’s post-secondary institutions, and thereby ensuring more students successfully attain a university degree and opportunities for longer-term economic prosperity.

Author: Sarah Welker, Policy Analyst
¹Mississippi Institutions of Higher Learning. Data from Enrollment in FY2008-2009. Includes full and part time enrollment.

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EQUAL PAY DAY 2012: A Closer Look at the Wage and Mississippi Industries

April 26, 2012

Filed under: Income & Working Families,Jobs — Tags: Mississippi, wage gap, Wages — admin @ 10:18 AM

In recognition of Equal Pay Day on April 17^th, a previous post reviewed wage gaps between men and women across Southern states. This post takes a look at working men and women with an eye towards Mississippi’s industries.

WOMEN, MEN AND MISSISSSIPPI’S INDUSTRIES

While men and women are increasingly equally represented in the workforce, they are not equally represented across all industries. Survey data reveals men represent 90% of Mississippi’s workers in construction and agriculture jobs and close to 80% of those in transportation and warehousing. In contrast, women make up about 80% of the workers in education and health services industries.

The chart shows women’s wages as a percentage of men’s wages for Mississippi’s full-time workers. It is important to note that each industry contains employees in many different occupations, and the wage data presented incorporate positions from management to entry-level workers. However, the graphic illustrates that the pay gap between men and women exists in each of Mississippi’s industries.

It is well established that women are more likely to pursue careers in fields associated with lower earnings. The three industries with the smallest pay gaps –construction, transportation and agriculture- are also traditionally male-dominated industries with a lower portion of women employed. Efforts are growing across the country to connect women to training in higher paying, ‘non-traditional’ careers as one path for lessening the difference in men’s and women’s wages.

Outside of industries, the American Association of University Women finds that even after controlling for factors like education, work position, age, college major, and the number of children in a family, an unexplained, though smaller, pay gap continues to exist between men and women. There is also evidence that this unexplained pay gap may grow over a woman’s career.

The pay gap between men and women has clear effects on families’ income and their economic security. And while the gap has diminished over time, the data from 2010 underscore that steps to preserve work supports for women and their families and steps to reduce gender pay discrimination continue to be necessary for Mississippi’s women and their families.

Author: Sarah Welker, Policy Analyst
Sources: U.S. Census Bureau. American Community Survey 2008-2010 Averages.

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EQUAL PAY DAY 2012: A Closer Look at the Wage Gap Between Men and Women

April 24, 2012

Filed under: Taxes,Workforce — Tags: gender gap, Mississippi, Wages — admin @ 10:50 AM

Last week MEPC’s blog focused on Tax Day(April 17th). Equal Pay Day was also April 17th and this week we are focusing on the differences in wages between men and women across the country.

Earlier this year, MEPC release its State of Working report and looked at hourly wages for all workers. However, more recent data from the Census Bureau allows a comparison of annual earnings for a more limited sample of full-time workers.

The chart below details the gap in wages between men and women that persists in many Southern states. Across all industries women working full-time in Mississippi earned 75% of men working full-time in 2010. The gap is same in Alabama and Arkansas while North Carolina, Florida and Georgia all registered smaller wage gaps that the national norm.

While disparities between full-time earnings for men and women continue, women continue to make advances in educational attainment. Women over 25 years old in Mississippi are more likely than their male counterparts to have attained an associate’s degree, bachelor’s degree or more.

This trend mirrors the nation where women are attaining post-secondary credentials at higher rates than men. Among Mississippi’s younger working-age population, the differences in educational attainment broaden. Thirty-seven percent of women between 25 and 34 years old have an associate’s degree or beyond compared to 26% of men in the same age range.

What about factors beyond educational attainment?

To continue Equal Pay Day coverage, an upcoming blog will look at wages and Mississippi industries and share national findings on women and wages.

Sources: U.S. Census Bureau. American Community Survey 2008-2010 Averages.
Author: Sarah Welker, Policy Analyst

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