Cuts to Higher Education Will Have Long-Term Effects, Says Study
States that have cut higher education budgets rather than raise taxes face long-lasting repercussions on their own economy, says a new report by the the Center on Budget and Policy Priorities.
The report by the CBPP, which scrutinizes budgets on both the federal and state level, found that states allocated 28% less per student for their 2013 budgets than they had in 2008.
As a result of the lack of state funding, the report found that colleges have increasingly relied on shouldering costs of education onto students themselves. Tuition has spiked by an average of 27% in the same 2008-2013 time period, with some states seeing an even more drastic increase, such as the over 70% seen in both Arizona and California.
According to the CBPP’s report, cuts in funding and the subsequent transfer in financial burden on to the students could have been avoided if the states had instead chosen to raise taxes:
States have disproportionately relied on spending cuts to close the very large budget shortfalls they have faced over the last several years, rather than a more balanced mix of spending cuts and revenue increases. Between fiscal years 2008 and 2012, states closed 45 percent of their budget gaps through spending cuts and only 16 percent of their budget gaps through taxes and fees (they closed the remainder of their shortfalls with federal aid, reserves, and various other measures).
The effects of such a practice, says Olif, will have a ripple-effect for years to come by ensuring less students are able to attend college, and lowering the quality of courses and research programs offered at individual institutions as well.
“There are more students going to college but fewer resources spread across those students,” said Phil Oliff, CBPP policy analyst, in a call with reporters. “It’s very clear that rising costs dissuade students from attending college, particularly students from low-income families.”
Additionally, Olif stated that budget shortfalls have made it more difficult for higher education institutions to hire on new full-time or even part-time staff, leading to fewer courses and a decrease in graduation rates.
The report backs up the findings of the recent studies which warn of a “domino effect” on the economy on both a state and federal level by cheapening the quality of college education, and could irreparably damage our global standing.
Areas with highly educated residents tend to attract strong employers who pay their employees competitive wages. Those employees, in turn, buy goods and services from others in the community, broadly benefitting the area’s economy. Economist Enrico Moretti of the University of California at Berkeley finds that as a result, the wages of workers at all levels of education are higher in metropolitan areas with high concentrations of college-educated residents.