The Great Resignation’s wage hikes may be sending fewer students to college

Virtual CSR

Published in Fortune Magazine March 24th, 2022

For many years, the prevailing narrative about post–high school plans has presented college—and particularly a four-year degree—as the gold standard for all students and an absolute necessity in the current job market. Kids are listening, and many of them agree.

Education technology provider EverFi surveyed over 140,000 students who took an online course about college and career readiness, and 56% of them expected to attend a two- or four-year college after high school.

Parents are similarly invested in college as the best post–high school option for their children.

“There’s an expectation and goal of most families that their kids go to college,” said Jean Eddy, CEO of American Student Assistance, a nonprofit focused on career exploration and readiness. “We’ve surveyed parents of middle and high school students, and they say that they are open to [noncollege] paths for their son or daughter, but 60% of those same parents also say that if my child doesn’t go to college, I’ve failed.”

Though kids and parents may both initially buy into the college dream, these aspirations are at odds with reality for a subset of them: The overall college enrollment rate for 18- to 24-year-olds was just 41% in 2019, according to data from the National Center for Education Statistics, and the National Student Clearinghouse reports that undergraduate enrollment further declined about 2.5% per year in the past two years.

In particular, community college enrollment has suffered: Enrollment at these institutions has been declining steadily since 2010 and fell off sharply in the past two years, dropping more than 13% since 2019. 

Given that community colleges predominantly serve low-income students and those from marginalized backgrounds, it’s likely that these groups in particular are dropping out of the college pipeline despite aspirations to attend. Janice Jackson, the former CEO of Chicago Public Schools and the current CEO of Hope Chicago, a nonprofit that provides scholarships to Chicago students, is worried about the far-reaching implications of this decline.

“Yes, from an equity standpoint, I’m concerned about seeing more people of color going to college and finishing,” Jackson said. “But beyond equity, in order for America to maintain its position of power, we need to have an educated populus. If more people in this country will be people of color [based on predicted demographic shifts], but there’s a decline in people of color going to college, everyone should be concerned.”   

There are a number of factors driving the mismatch between kids’ initial college aspirations and their eventual matriculation. Perhaps unsurprisingly, the skyrocketing cost of a degree combined with the difficulty of obtaining financial aid tops the list. Despite a recent increase in funding for Pell Grants (need-based aid awarded to low-income students), these awards haven’t kept pace with the cost of college. And even when financial aid is available, millions of dollars are left unclaimed every year because the process to apply for it can feel arduous and confusing.

This affordability crisis in higher education isn’t new, but it’s playing out against a new backdrop: The pandemic and the Great Resignation are presenting students with both unique complications and opportunities that are changing the way they think about college. 

The current decrease in college enrollment runs counter to past trends—college enrollment typically spikes during recessions—and Riley Acton, an assistant professor of economics at Miami University, theorizes that this is at least partially due to the effects of the pandemic, in particular the psychological toll of constant uncertainty. 

“Maybe you thought you were going to college, but then the pandemic struck, and it’s really hard to plan one month to the next,” Acton said. “The uncertainty we’ve all faced gets amplified in a process that is already complex and uncertain for a lot of students, particularly those who are the first in their families to go to college.”

In the face of this amplified uncertainty, students might ideally turn to their school counselor for help. However, as is the case for other school support staff like social workers, there is a severe shortage of school counselors. 

Though the American School Counselor Association recommends a ratio of 250 students for every one school counselor, the national average is 415 to one, and Yarbrah Peeples, the chief program officer at College Advising Corps, has seen some schools where a single counselor serves upwards of 1,000 students. 

“When we think about the work of a school counselor, the time to sit down individually with every student isn’t there,” Peeples said. “It isn’t a fair request to make of counselors.”

Further complicating matters, school counselors are not always required to complete coursework in college advising as part of their degree programs. School counselors can have a number of roles in a school, from supporting students’ socioemotional needs to assisting with course registration and test administration, so college advising is not always a prominent focus of a school counselor’s training.

This means that students are often left to untangle the complicated web of post–high school decisions on their own, sometimes with guidance from friends and family members who don’t have the specialized knowledge students need to effectively navigate a complex and intimidating process.

“Students try to do their own research, but advising is a resource that schools need,” Peeples said. “A professional needs to be able to offer advice and connect students to resources.”

This is particularly true in the period between a student’s acceptance to college and their actual matriculation, a time that many in the college access field call the summer melt, so named because students—particularly low-income students or those who are the first in their families to go to college—face a confusing and often daunting array of tasks that can deter them from enrolling.

During this time, students are often required to complete lengthy paperwork, respond to requests for missing documentation, and pay deposits to hold their seat or guarantee housing, all of which can be made more complicated for kids who don’t have reliable internet or computer access at home. 

Peeples also points out that these deposit requests come at a time when families are facing other expenses related to high school graduation, such as senior-year events and graduation celebrations. Since deposits are often required in the spring, students are unable to use financial aid to pay them and must pay out-of-pocket instead. If they delay, they may miss out on more affordable housing options or face further complications down the line. 

“There’s a lot of fear with a lot of students, especially if nobody has made the transition to college in their families,” Peeples said. “It can feel like any bump in the road is something saying you shouldn’t go. It’s a sign that this isn’t for you.” 

In addition to exacerbating this fear, the pandemic has brought a host of other barriers that were bound to have ripple effects on college enrollment, particularly at community colleges. Students who may have enrolled in a normal year faced childcare disruptions, family members that required intense care, and programs and classes that were no longer available, given the shift to online instruction. 

Acton points to research out of the University of Virginia showing that the impact of the pandemic on college enrollment was particularly severe for men, perhaps because the programs they tend to gravitate toward, such as skilled trades, didn’t translate well to virtual instruction.

At the same time that the pandemic made college look like a less feasible option to many students, the Great Resignation brought a flood of attractive employment opportunities with higher-than-usual starting salaries. Peeples has seen an increase in different types of credentialing programs that don’t depend on traditional vocational schools, for example, companies offering on-the-job training and certifications directly to their employees. 

According to Eddy, this trend appeals to the temperament of many Gen Z students.

“Gen Z is very different from previous generations,” Eddy said. “All of our research suggests that these kids are looking for hands-on experiences. They want to be skilled. They want to try different things.”

Cartomu Kabba, 20, fits this description well. Kabba graduated high school in 2020 planning to pursue a course of self-study in data science. She envisioned herself working part-time while teaching herself data science fundamentals and building a portfolio of project-based work.

Shortly after graduating, she instead saw an opportunity to participate in a one-year professional apprenticeship program with education technology company Multiverse. The program would allow her to work full-time while learning data science through a mix of online modules and on-the-job training. 

Though the ability to earn a salary directly out of high school without taking on debt was a factor in her decision, she was primarily attracted by the promise of hands-on experience and the opportunity for self-study, both of which she believes are crucial to her career development.  

“I felt like it was better for me to learn multiple different skills that would pay off in the long run, like teaching myself to learn,” Kabba said. “For any path I want to take, like starting a business, the skill set of [teaching myself] will pay off.”

Kabba is currently working as a data analyst apprentice at the insurance company Chubb, and she is set to finish her yearlong apprenticeship this month. Upon completion, she’ll receive a certificate from the Department of Labor in data analytics, and she is hopeful that Chubb will keep her on as a full-time employee. She feels that her future job prospects are strong, thanks to the work experience she’s gained over the past year.

“I do have more experience than somebody in an entry-level position that has just graduated college,” Kabba said. “If we’re doing that comparison, I think I’d have a higher earning potential than them.”

It’s clear that noncollege pathways such as the one Kabba chose have much to offer, but Hope Chicago CEO Jackson notes that lifetime earnings are often still tied to college degree completion.

“It’s smart in some ways [that kids don’t take on huge college debt],” Jackson said. “But we know that without a degree, earning power is limited.”

Fortunately, colleges and other organizations in higher education access are taking steps they hope will reverse the decline in enrollment and bring more students to and through college. 

Jenny Rickard, the president and CEO of Common App, a nonprofit member organization of over 900 higher education institutions, has seen colleges take various steps to stem the enrollment decline, including making college entrance exams optional (over 95% of Common App member institutions are now test-optional, compared to just 45% two years ago), waiving application fees, and doing special outreach to applicants who identified as the first in their families to attend college.

Common App is also working with a number of institutions to pilot direct admissions programs, in which colleges reach out to potential applicants who meet a certain high school GPA threshold and guarantee them admission if they complete an application. Rickard sees direct admissions as a promising way to get more students into the college pipeline.

“When we think about first generation students who may not have someone they know who has gone to college, that pressure they feel to get into a particular school is big,” Rickard said. “Direct admissions eliminates the emotional barriers of stress, anxiety, and fear of rejection.”

Though these developments are positive, leaders in higher education access advocate for even greater change, including further increasing the maximum Pell Grant award, simplifying the application process for federal student aid, and standardizing financial aid award letters so that college costs are clearer to students and families upfront. 

Jackson emphasizes that while many organizations are working hard to expand college access and enrollment, broad systemic changes are needed to bring about lasting change.

“This is not something we will fundraise our way out of,” Jackson said. “The federal government has to fundamentally change how it thinks about higher education because our country’s future depends on it.”


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