Economic Factors Influence College-making Decision

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Introduction Economic factors that influence the college-making decision Today, due to state budget cuts, federal changes in student loans, unemployment, and reduced college endowments, economic issues weigh heavily on the minds of students. Cost, financial aid, and employment opportunities are the top factors in influencing students’ enrollment decisions for all types of colleges (Noel-Levitz 4). State universities have now become, in many cases, prohibitively expensive for many families. Financial aid at formerly generous private schools has dwindled and merit scholarships have gotten smaller or disappeared completely. In fact, 31% of students who did not enroll in their first-choice school said that their main reason was that they could not afford it (Vadala and Falkowski). However, the current economic downturn and increasing unemployment rate have led to college enrollment gains of up to 27% (Lee and Chatfield 7). As a result of the current economy and the need for a college degree, students change their college plans by enrolling in a less expensive college, working while attending college, relying more on financial aid counseling, obtaining a larger loan, or attending a college closer to home (Longmire and Company 5). Impact of student loan interest rates changing While a bipartisan bill passed last August reversed the interest rate hike on federally subsidized Stafford student loans, reducing the rate from 6.8% to 3.4%, the rate change only affects future student loans and does not address the $1 trillion student debt that is currently weighing on college graduates throughout the country (Matthews). Additionally, government subsidies have the perverse effect of encouraging colleges to increase tuition to capture mor... ... middle of paper ... ...lients (Baum et al.). 8 of the top 10 growth areas, all which are computer related, require a post-secondary degree (Williams and Swail 11). The information age has replaced the industrial age as technology is the driving force behind the transformation of the American economy. This favors workers with more education because they have the expertise needed to handle more complex tasks and activities. Therefore, demand for workers with degrees grows extensively as technology spreads throughout society (Carnevale, Smith, and Strohl 16). Economic impact and who is affected An advanced degree provides individuals with a clear path to the middle class, a higher likelihood of meaningful and gainful employment, and lifelong financial and personal benefits. College education also provides for a skilled workforce that is crucial to rebuilding the entire American economy.
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