Tuesday, January 13, 2009

Note 4: Debt and Persistence

This post is part of a week-long series.

The Restricted Access movement is concerned not only with those qualified students who, for financial reasons, cannot make it to university, but also with those who are forced to abandon their studies due to their financial burdens. This Research Note begins:

There is convincing empirical evidence that qualified students can be driven to abandon post-secondary education if their debt load is too high. This inevitably has an impact on the country’s ability to compete effectively in a knowledge-based global marketplace.
There is an explicit need, this Note determines, for student aid to combat the barriers to access and persistence.

So does debt really matter? Millennium couldn't be more clear on this, indicating that as student debt loads increase, both course loads and completion rates decrease. "In short, debt matters."


The second question is regarding the effect of student aid. Again, the evidence is clear: those who receive grants on top of their student loans are five times more likely to complete their degree than those who rely solely on loans.


It is demonstrated that as well as grants, loan remission works, and for one simple reason: it lowers debt. However, we must first ensure that unmet need is met, as students must be able to meet their cost of living before worrying about their debt load. So although debt certainly matters, "unmet need matters more," indicating that there are even some basic needs we still need to meet.

And it is in our interest to meet them.
Canadians have a significant long-term economic stake in ensuring that every qualified student can pursue a higher education without risking financial jeopardy. Consequently, it is vital that policymakers be aware of the need to ensure that student aid adequately meets the needs of students,but also that it is generous enough to ensure that debt does not drive students to abandon post-secondary studies.
You can read the Note here.

2 Comments:

Anonymous said...

"those who receive grants on top of their student loans are five times more likely to complete their degree than those who rely solely on loans."

Grants for everyone!

Of course if that were the case, we might see the completion rates drop. Might there be a correlation between receiving a grant (involving both the initiative to apply, as well as the academic success that comes with actually applying oneself in their classes) and having that extra bit of motivation to complete your degree?

My point is, a grant can be a wonderful thing, but it can also be a complete waste of money if you're one of the many students drifting through PSE without any sense of direction/motivation. I just have to wonder how many non-completers were truly horrified at the prospect of more debt, vs. the countless other reasons that one might choose to drop out or pause their studies.

Cicero said...

The statistic you cite is used simply to indicate the weight of the added burden of student loans on lower-income students; the argument is not that every student should receive a grant.

Your point about motivation, however, is more on the mark. Need- and income-based grants provide opportunities to continue education where socio-economic conditions (and background) would make it otherwise difficult, if not impossible. Many of these students may indeed have more drive or motivation -- all the more reason to improve access since this would generate greater competition and therefore greater quality in our university.

As for the "countless other reasons one might choose to drop out or pause their studies," it is true that not all students necessarily discontinue their studies due to financial reasons. However, that is still the reason for a significant portion of students, and likely more so for those who are forced to rely on loans and other financial aid.

We can again look to your point about motivation for those who receive grants. When one has "both the initiative to apply, as well as the academic success that comes with actually applying oneself in their classes," it becomes harder to imagine them dropping classes due to a lack of interest.

By improving access, we are not simply making it easy for "the many students drifting through PSE without any sense of direction" to attend. We are creating a deeper pool of qualified and competitive applicants who will in turn create a higher-quality institution.

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