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Noah Black
noah.black@apscu.org


Weekly Research Digest, 8-28-13

A SNAPSHOT OF RECENT RESEARCH
RELATED TO POSTSECONDARY EDUCATION


Consequences of the 90/10 Rule
Edvisors, August 2013

This report addresses the 90/10 rule's underlying rationale to ensure that private for-profit institutions have "skin in the game"--namely, that their revenues do not totally depend on federal financial aid--by requiring that at least 10 percent of an institution's revenues come from other sources. Highlights are available in a one-page document.

Major findings include: 

  • Colleges that enroll significant numbers of low-income students risk violating the 90/10 rule, and those with high numbers of students with such characteristics as member of a minority group, Pell Grant recipient, part-time attendance, low high school GPA, and first-generation college student also may have difficulty complying with the rule. 
  • Counting military student aid increased the 90/10 percentage by only two points, whereas counting education tax benefits raised it by five points. Interestingly, if the rule was applied to all sectors of higher education, a higher percentage of public institutions, particularly community colleges, would fail.

Recommendations include:

  • Repeal the 90/10 rule and replace it with direct measures of educational quality, such as passage of licensing exams.
  • Exclude student loans if the college has a high repayment rate.
  • Exclude low-income students from the calculation.
  • Weight the measure by the student’s expected family contribution.


A Well-Educated Workforce is Key to State Prosperity
Economic Policy Institute, August 2013

This report found that “overwhelmingly, high-wage states are states with a well-educated workforce. There is a clear and strong correlation between the educational attainment of a state’s workforce and median wages in the state.”

Other major findings include:

  • States that invest in education not only will achieve enhanced economic opportunity but also will strengthen the overall state economy.
  • Cutting taxes to capture private investment undermines the ability to invest in education.
  • Investing in education results in higher numbers of well-educated individuals, which in turn results in attracting high-wage employers.
  • Higher paid workers contribute more through state taxes during their lifetimes. 

In the News
Washington Post – "Report: Long-term education investments lead to higher wages"


Looking Beyond Enrollment: The Causal Effect of Need-Based Grants on College Access, Persistence, and Graduation
National Bureau of Economic Research, August 2013

Gaps in average college success among students of differing backgrounds have persisted in the United States for decades. One of the primary ways governments have attempted to improve such gaps is by providing need-based grants, but little evidence exists on the impacts of such aid on long-term outcomes such as college persistence and degree completion. Looking at the effects of the Florida Student Access Grant (FSAG), this report shows that providing students with financial aid makes them more likely to complete college.

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PSCUs open doors to many of the 13 million unemployed and 90 million undereducated Americans by providing a skills-based education. To remain competitive over the next decade, we must identify between 8 and 23 million new workers with postsecondary skills. PSCUs are a necessary part of that solution, having produced over 800,000 degrees last year alone.