Another wave of students may opt out of college this fall

• The pandemic's economic impact is far from over.
• As another class of undergraduates gets set to start college in the fall, families are once again struggling with their ability to pay.

As the delta variant drives new Covid cases across country, the pandemic's economic impact continues to weigh heavily on college enrollment.

Now, with another class of undergraduates set to start classes in the fall, families are once again struggling with the cost.

Nearly two-thirds of parents, or 63%, said their child's post-high school plans have returned to what they were before the global pandemic, according to a report by Discover Student Loans.

But of those who have changed their college plans, most said they will now go to a school closer to home, attend an online university or go to a less-expensive alternative.

More from Personal Finance:
College plans rebound although cost is a top concern
Hundreds of colleges say Covid vaccines will be mandatory
Colleges and unvaccinated students are set for a standoff

Research shows these students are primarily from low-income backgrounds, students of color and first-generation students — also hardest hit by Covid.

Half of the students who are not attending college or enrolling in a career and technical education program would have attended if they had received adequate financial aid, according to another recent report by the Horatio Alger Association.

Four in 10 students need more financial aid than they did before the pandemic, and 1 in 7 students who did not previously require aid need it now, the nonprofit organization found.

Of the students who are pursuing further education and received a scholarship, 70% said it was a deciding factor in their ability to enroll.

"Cost was the No. 1 problem I had, because I knew my family wouldn't be able to help," said Mariah Jimenez, 18, a recent high school graduate from Albuquerque, New Mexico.

"All of senior year, I was scared I wouldn't have enough to pay for college," she said.  

When Jimenez found out she was a recipient of a $25,000 scholarship through Horatio Alger, "I cried," she said.

In September, Jimenez will begin her freshman year at Southern Utah University and plans to study nursing. "I am extremely excited," she said.

When Covid brought the economy to a standstill, one-quarter of last year's high school graduates delayed their college plans, according to a separate survey from Junior Achievement and Citizens, largely because their parents or guardians were less able to provide financial support.

Although about 40% of parents said their ability to help pay has improved since this time last year, 63% remain concerned about having enough money for higher education, Discover also found.

The vast majority of students and their families still say college is well worth it, despite the rising cost. And yet, it is increasingly out of reach.

Tuition and fees plus room and board for a four-year private college averaged $50,770 in the 2020-21 school year; at four-year, in-state public colleges, it was $22,180, according to the College Board, which tracks trends in college pricing and student aid. 

When adding in other expenses, the total tab can be more than $70,000 a year for undergraduates at some private colleges or even out-of-state students attending four-year public schools.

"If we want more students from diverse backgrounds to consider furthering their education, we must ensure that they have access to the necessary resources to help pay for it," said Terrence Giroux, executive director of the Horatio Alger Association.

On Thursday, the U.S. Department of Education said it will provide an additional $3.2 billion in emergency grants to help under-resourced institutions develop programs to engage disconnected students, expand mental health services and improve retention rates.

The current model is unsustainable, according to Lynn Pasquerella, president of the Association of American Colleges and Universities.

"I hope this provides the impetus for reimagining higher education and addresses the racial and economic segregation," she added. "I don't think the answer is to deny access to those at the lowest economic rungs."

Subscribe to CNBC on YouTube.

Source: Read Full Article