State Higher Ed Funding Down Billions Since Great Recession

State funding for public higher education continues to be well below the level it was before the Great Recession, with states allocating nearly $9 billion less during the 2017 school year than they did in 2008 for public four- and two-year institutions, according to new data from the Center on Budget and Policy Priorities (CBPP).
According to CBPP, 44 states spent less per student in the 2017 school year than in 2008, and only five states – Indiana, Montana, Nebraska, North Dakota, and Wyoming – spent more than in 2008. Wisconsin was left out of the analysis due to changes in the funding model for its public higher education institutions. Following the recession, the average state spent 16 percent, or $1,448, less per student in 2017 than in 2008. Eight states – Alabama, Arizona, Illinois, Louisiana, New Mexico, Oklahoma, Pennsylvania, and South Carolina – saw a decline in per student funding of more than 30 percent since 2008.
Still, in the most recent year (between 2016 and 2017), 36 states saw increases in per-student funding, jumping 2.2 percent or $170 nationally, although 13 states continued to see declines in per-student funding. 
Cuts to state funding have had “major consequences” for public institutions, and states have been forced to compensate for those cuts through tuition increases or cuts to educational and other services, according to CBPP’s analysis. For example, annual published tuition at four-year public institutions increases by 35 percent—$2,484—since 2008. Some states have seen increases between 50 percent (Louisiana) and more than 60 percent (Alabama, Arizona, California, Colorado, Florida, Georgia, and Hawaii).
And despite a decline in state funding for students and institutions, the demand for a college education only increased during the Great Recession, growing by 8 percent between 2008 and 2016 and peaking in 2011 at nearly 11.7 million full-time equivalent students. Declines in state tax revenues and significant state budget cuts and spending reductions have resulted in the high cost of college being passed on to students and families, who rely more heavily on federal student aid programs like the Federal Pell Grant Program and student loans.
But shifting the cost to students and families also has “damaging” consequences, particularly for low-income students and students of color, including deterring students from enrolling in college altogether and ultimately impeding state efforts to boost local economies and workforces, according to CBPP. 
“Sufficient public investment in higher education to keep quality high and tuition affordable, and to provide financial aid to students who need it most, would help states develop the skilled and diverse workforce they will need to compete for these jobs,” CBPP states in its analysis. “To make college more affordable and increase access to higher education, many states need to consider new revenue to fully make up for years of cuts.”


Publication Date: 8/24/2017

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