Report: Levels of Educational Attainment on the Rise for All Racial and Ethnic Groups, but Financial Equity Gaps Remain

By Maria Carrasco, NASFAA Staff Reporter

A recent report from the American Council on Education (ACE) is looking to provide the higher education community with updated data to help address, and work to close, systemic equity gaps.

The latest iteration of their report "Race and Ethnicity in Higher Education" serves as a followup to ACE's respective 2019 and 2020 reports, covering several topics on race and ethnicity in higher education, including undergraduate and graduate student enrollment, completion rates, student debt, and financing.

Data for 2024’s report pulled information from eight principal sources, including the Department of Education (ED) and U.S. Census Bureau, and looks specifically at the 2019-20 academic year. 

A key takeaway from this report was that although the white population has continued to be the largest racial and ethnic group in the U.S., diversity in higher education participation has also increased. 

While the levels of educational attainment continued to rise for all racial and ethnic groups, the data still found equity gaps. One noteworthy example in the report of this financial disparity was that Black and African American students are more likely than those from other racial or ethnic groups to accumulate large amounts of educational debt. 

In evaluating how undergraduate students finance their education, ACE noted that between the 2010-11 and 2020-21 academic years, the average total cost of attendance went from $27,589 to $35,725 at four-year institutions, and from $13,777 to $16,503 at two-year institutions. 

“As the cost of attending college increases, students face larger financial barriers,” the report read. “Given the rise in prices, many students rely on grants and loans to help cover tuition, fees, books and supplies, and other expenses associated with college enrollment.”

When it comes to FAFSA completions for the 2019-20 academic year, 69.7% of all domestic undergraduate students and 73.6% of full-time students completed the FAFSA. Both Black or African American dependent and independent students had the highest filing rates across all racial and ethnic groups, with 90.5% and 81.2% respectively. Multiracial students had the lowest FAFSA completion rate among both full-time – at 70.8% – and dependent students – at 68.2%. 

The report also looked at Expected Family Contribution (EFC), which determines a family’s ability to make any financial contribution to their student’s post-secondary education. Black or African American students had the highest percentage of undergraduate students with an EFC of $0, at 55.1%, followed by American Indian or Alaska Native and Hispanic or Latino students. 

The data found that Black or African American students were more likely than others to receive grant aid to fund their undergraduate education, at about 80.6%. The report noted that sources of grant aid varied among racial or ethnic groups, with Black or African American full-time students receiving 36.5% of their grant aid from non-military federal programs and 37.2% from institutional grant aid. Meanwhile, among white full-time students, 17.7% of grants were federal and 54.5% were institutional.

Overall, 71.3% of full-time undergraduate students received grant aid in 2019-20, and about half of that grant aid came from institutional grant aid, ACE noted. 

The report also looked at student borrowing from federal loan programs and private loans. In the 2019-20 academic year, the average undergraduate student borrower took out $7,948 in student loans. White students borrowed an average of $8,151, Asian students borrowed an average of $7,620, Hispanic or Latino borrowers an average of $7,448, and Black or African American students borrowed an average of $7,373. These averages excluded the Parent PLUS Loans program. 

The report also examined the shares of students who borrowed to pay for educational costs. Overall, 36.1% of all undergraduate students borrowed loans, excluding Parent PLUS loans. However, Black or African American students made up the highest share of students who borrowed loans, at 49.7%, followed by white students at 38.6%, and multiracial and Native Hawaiian or other Pacific Islander students at 38.6%. 

Graduate education financing was another component of the report. ACE noted that between 2015 and 2021, graduate enrollment in the U.S. increased 10%, from approximately 2.9 million to 3.2 million students, and graduate enrollment is expected to grow another 6% by 2031, according to the National Center for Education Statistics. 

“With the increasing number of individuals who are pursuing graduate education, it is important to examine how these students afford their studies,” the report read. “The national conversation on college affordability often focuses on undergraduate education, but the ways that graduate students finance their education are quite different from how undergraduates pay for college.” 

Overall, graduate students received less grant aid and covered more expenses through earnings and loans than undergraduates. In the 2019-20 academic year, 44.7% of graduate students received some grant aid. More than half of research doctoral students received grant aid, at 51.5%, followed by professional and other doctoral students, at 46.1%, and master’s students, at 43%. 

As for the types of grant aid in 2019-20 that graduate students received, 29% received grant aid from their institutions, 13% from their employers, and 6.5% from other private sources. 

Looking specifically at institutional grant aid among master’s students, the percentages of students who received institutional grant aid were similar across racial and ethnic groups – ranging from 22.3% of white students to 27.8% of Asian students. However, the average grant amount per recipient differed by race and ethnicity, ACE noted, where Asian students received an average of $11,712, while Black or African American students received $5,149.

Additionally, ACE found that among professional and other doctoral students, 33.5% of Black or African American students received institutional grant aid, while over half of international students, 51.4%, received institutional grant aid. Among research doctoral students, Black or African American students had the lowest percentage of students who received institutional grant aid, 30.8%, and received the smallest average grant amount per recipient, $10,797, out of any racial and ethnic group. 

Looking at borrowing trends from graduate students in the 2019-20 academic year, 68.5% of professional and other doctoral students borrowed an average of $43,371, 45.5% of master’s students borrowed an average of $20,610, and 19.1% of research doctoral students borrowed an average of $19,595. 

ACE noted that the largest amount of loans were borrowed from federal loan programs, with about 40% of all graduate students in 2019-20 borrowing federal loans. Meanwhile only about 5% borrowed private loans.

Disparities were also found among racial or ethnic groups when it came to graduate borrowing. Specifically, the majority of Black or African American graduate students – 64.5% – borrowed some type of loan in the 2019-20 academic year, followed by Hispanic or Latino graduate students at 55.9%. Meanwhile, fewer than half of all other racial and ethnic groups borrowed funds. However, the report noted that Asian students had the highest average loan amount per borrower at $39,613. 

A full summary of the report is available, debriefing the entire findings of the 2024 report.


Publication Date: 5/28/2024

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