You are here

Professional Opinion

Smaller colleges fuel social mobility

An institution’s wealth does not necessarily translate to better outcomes for students
University Business, August 2016
Jeffrey R. Docking is the president of Adrian College in Michigan and the author of "Crisis in Higher Education: A Plan To Save Small Liberal Arts Colleges in America."
Jeffrey R. Docking is the president of Adrian College in Michigan and the author of "Crisis in Higher Education: A Plan To Save Small Liberal Arts Colleges in America."

Sometimes, well-known propositions lead to predictable conclusions. But not always. Occasionally, they lead to surprises—and even busted myths.

Here’s one: Wealthy, private institutions willing to invest large endowments in financial aid for poorer students do the best job of expanding access to higher education and reversing the trend toward greater income inequality.

That statement turns out to be half true. Yes, lower-income and first-generation students seem to have better outcomes when they attend private institutions, and particularly smaller colleges where support systems and faculty engagement combine to create institutional cultures strongly centered on student success.

But here’s the paradox: It’s not the wealthier institutions doing the best job of accomplishing this objective. It’s less-affluent institutions far down the endowment pecking order. The surprising conclusion? There are some things—some very important things—that elite institutions are not, in fact, better at doing.

Wealth doesn’t ensure success

Let’s go back to the uncontroversial proposition. Here are things I think I can probably stipulate without fear of great controversy:

  • Our society confronts a growing disparity in income between the very wealthy and the least well-off.
  • The uniquely American project of social mobility is no longer the easy or expected pathway it once was. The prospects for social and economic advancement are becoming narrower and more difficult for lower-income youth.
  • A related problem is a potential decline in our economic competitiveness in a globalizing world over the decades ahead. Our ability to remain at the forefront of innovation, technological prowess and income generation rises and falls as a function of our ability to compete in economic sectors increasingly driven by nimbleness of thought—not by natural resources or large-scale industrial production.
  • Education, and particularly higher education, is the best way to revitalize social mobility; restore our competitive preeminence in the world, and reverse the trend toward inequality in income and opportunity.

So far, none of this is extraordinary. But from this point forward the picture becomes more complicated.

It would be reasonable to think that better student outcomes are associated with greater institutional resources. And it is surely the case that the widening separation between the richest and the poorest in our society can be seen in the spread of wealth and poverty in our institutions of higher education.

Most readers will be familiar with the series of recent analyses published by Moody’s showing the increasing concentration of endowment funds in a smaller and smaller percentage of institutions.

At last count, of the top 500 best-endowed public and private institutions, the top 8 percent hold 66 percent of all invested funds.

This isn’t just a snapshot, it’s a movie. Between 2009 and 2014, the resources of the wealthiest schools grew at a rate much faster than those of middle- and lower-tier schools.

Despite the growing inequality, data shows the wealthiest schools by no means perform better at some key tasks that drive social mobility, including: promoting access to college for low-income and first-generation students; making higher education available at a manageable cost; and reducing debt loads to improve post-graduation economic prospects.

What does quality cost?

Let’s get specific about this. Eligibility for federal Pell Grants is a generally accepted measure of the percentage of a student body coming from the lower tier of family income.

Yet, IPEDS data shows Pell Grant students account for only 15 percent of all students at the institutions with the largest endowments; and 35 percent of all students at a cross-section of institutions that, like mine, have endowments in the tens, rather than the thousands, of millions.

The same disparity shows up in the overall cost of the undergraduate experience. Like many readers of these pages, I spend a great deal my time defending the very real costs of providing a high-quality undergraduate education. But I also know that the average cost at small private colleges—just speaking of the tuition and fees—stands at $29,173, while for the 10 wealthiest institutions that figure is quite a bit larger, at $40,713.

Yes, these institutions have more resources to offset those costs through financial aid packages. But it is simply not the case that this tremendous differential in cost reflects an equal differential in the quality of the educational or the social experience.

Results not seen

If those larger endowments are being used to help students make up for the differential in cost, it’s sure not showing up in the debt loads students carry out of college.

In fact, despite the vast (and growing) difference in the endowments of the wealthiest institutions, the debt loads of our graduating students look practically the same.

The median debt for a Pell Grant recipient at one of the 10 largest-endowment schools stands at $19,940, while at my cohort of small private colleges it’s $21,076. (At my own institution it’s substantially lower.) And I haven’t seen any of those wealthier institutions sharing the risk with their students by providing access to less punitive loan repayment programs in case their job search runs into trouble. But we are, and we’re sharing that model with others.

Okay, so:

  • Not all institutions do equally well in assuring access, manageable cost and smaller debt loads; and
  • The gap between rich and poor institutions is wide, and growing, at an accelerating rate.
  • Therefore the best bet for addressing the problem of social mobility, and restoring the possibility of an upward path on the socioeconomic slope, would be to expand the chances for these students to attend the wealthiest institutions. Right?

Well, no. You’d think so. But on the evidence, you’d be wrong. That turns out to be the surprising conclusion from the boring premise.

We need to revitalize our nation’s historic capacity to provide more than the hope—but the real possibility—of upward mobility. And we have a robust variety of institutional types in the higher education sector—public and private, undergraduate and doctoral, rich and poor.

But if we really are serious about addressing the dangers posed by the widening chasm of inequality to our future as a free, prosperous, and competitive nation, we might be well advised to focus resources with intention and purpose on the institutions demonstrating the best results at reversing that trend by revitalizing the real prospect of social mobility—and not just the best public relations strategies for talking about inequality.

It turns out that those institutions best accomplishing this task may not be the most elite, the wealthiest or the most influential in the corridors of power, but these less affluent schools are accomplishing a crucial social task, one at which they are often outperforming in significant ways, far wealthier ones.

Jeffrey R. Docking is the president of Adrian College in Michigan and the author of Crisis in Higher Education: A Plan To Save Small Liberal Arts Colleges in America (Michigan State University Press, 2015).

Register now for UBTech 2018, June 4-6 at the Mirage, Las Vegas. At UBTech 2018, you’ll network with a dynamic community of higher ed leaders who are shaping the future of campus technology and explore topics like cyber security, distance learning, campus learning space design, communications, personalized learning and more. Your UBTech registration also includes a free pass to the InfoComm exhibit hall.

Register now>>