Tuition Rates & Access

Tuition rates are increasing.

In MO, tuition rates at public universities have increased steadily when adjusted for inflation over the past 10 years (DHEWD 2023, DHEWD 2007). Four-year public universities are increasingly reliant on tuition as a funding source as state education funding decreases (State Higher Education Finance 2024). In 2023, tuition at public 4-year universities in MO accounted for 56% of institutional budgets, compared to 22% in 1980. For more information on tuition changes in MO, see the MO University Funding & Tuition Science Note.

Higher tuition costs disproportionately impact low-income students.

MO does not collect income demographic data for higher education students attending college in MO (Reda, DHEWD, personal communication). Nationally, higher tuition rates widen the achievement gap between low-income and other students (Brint 2022). These include degree completion gaps, income gaps, and in more expensive institutions for low-income students (Brint 2022, Calahan et al. 2022).

College participation rates for low-income students have been increasing from 28% of high school graduates in 1970 to 48% in 2020 (Calahan et al. 2022). This rate is lower than other income groups, between lowest and highest income students (Figure 1).

Despite higher participation rates, college completion rates are low, particularly for low-income students (Calahan et al 2022). Of a random sample of more than enrolled in postsecondary education, roughly 40% of students did not complete a degree or certificate (Cohen et al. 2024). In contrast, 10% obtained an associate’s degree, 35% obtained a bachelor’s, and 7% obtained a graduate degree. Non-completion risk factors include working > 35 hours per week, delayed enrollment, no regular high school diploma, part-time enrollment, having children, and being a single parent (Calahan et al. 2022).

The federal Pell Grant program is designed to mitigate some of these risk factors by providing funding for low-income students to attend college (U.S. DoE 2024). Low-income students receiving federal Pell Grants are able to enroll in more units and work fewer hours (Denning 2017, Park & Scott-Clayton 2017). This leads to higher completion rates and faster graduation times than students with similar incomes without Pell Grants. For each $1,000 of additional student aid, low-income students are 6% more likely to complete their degree (Franke 2016).

Pell Grant recipients and low-income students are increasingly attending for-profit colleges, rather than traditional public or private not-for-profit universities, where they have worse outcomes than their peers attending not-for-profits (Calahan et al. 2022, Riegg Cellini 2021). For-profit students because students are eligible for external financial aid (Cottom 2017). These colleges have an easy application process, and open admission policies. They have lower completion rates, higher default rates, and worse labor market outcomes for students than traditional not-for-profit institutions (Deming et al. 2013, Woo et al. 2017).

Solutions exist to combat the rising costs of higher education, but not housing.

Possible remedies for the rising costs of higher education include cost containment strategies, encouraging universities to pursue alternative revenue sources, performance funding policies, increased state investment in institutional support, and financial aid reforms (Brint 2022). Financial aid reforms include increasing the size of grants to low-income students and expansion of income-contingent loan repayment or forgiveness programs.

The number of students receiving MO state level scholarships is decreasing, however, the amount of money received by each student is increasing (DHEWD 2023, DHEWD 2012). Nationally, the number of students receiving Pell Grants and other federal support for attending college is increasing, from 32% of undergraduates in 2001 to 52% in 2020 (Calahan et al. 2022). In MO, the percentage of undergraduate students at degree granting institutions receiving Pell Grants has remained constant since 2008 (29%) (NCES 2022). Pell Grants have kept pace with inflation but not tuition increases and living expenses (CBO 2013, College Board 2024). Pell Grant recipients were 65% more likely to have to borrow than non-Pell recipients and had borrowed an average of $19,000 more than non-Pell recipients upon degree completion (Calahan et al. 2022).

MO currently has four state administered loan forgiveness programs for health professionals and large animal veterinarians (DHSS 2024, DoAg 2009). However, with few exceptions, these programs are for advanced degrees only (MS, MD, VMD).

Figure 1. Dependent 18-to-24-year-olds Cohort College Participation Rates by family income quartile: 1970 to 2020. Figure obtained from Calahan et al. 2022, Equity Indicator 1a. Income ranges include lowest: less than $46,697 per year, second: $46,698 - $84,530 per year, third: $84,531 - $141,886 per year, highest: $141,887 and above per year.

References

Brint, S. (2022). Challenges for higher education in the United States: The cost problem and a comparison of remedies. European Journal of Education. 57 (2): 181-198. https://doi.org/10.1111/ejed.12496

Calahan MW, Addison M, Brunt N, Patel PR, Vaughan T, III, Genao A, Perna LW. (2022). Indicators of Higher Education Equity in the United States: 2022 Historical Trend Report. The Pell Institute. University of Pennsylvania. https://eric.ed.gov/?id=ED620557

Cohen ED, Huo H, Guyot K, Gaffney C, Christopher EM. (2024). High School Longitudinal Study of 2009 (HSLS:09) A First Look at the 2021 Postsecondary Enrollment, Completion, and Financial Aid Outcomes of Fall 2009 Ninth-Graders. National Center for Education Statistics, U.S. Department of Education. https://nces.ed.gov/pubs2024/2024022.pdf

College Board. (2024). Trends in College Pricing and Student Aid 2024 Full Report. Trends in Higher Education: Trends in Student Aid. https://research.collegeboard.org/trends/student-aid

Congressional Budget Office (CBO). (2013). The Federal Pell Grant Program: Recent Growth and Policy Options. https://www.cbo.gov/sites/default/files/113th-congress-2013-2014/reports/44448_PellGrants_onecolumn.pdf

Cottom, TMM. (2017). Lower Ed: The Troubling Rise of For-Profit Colleges in the New Economy. link

Deming D, Goldin C, Katz L. (2013). For-profit colleges. Future Child. 23 (1): 137-163. https://doi.org/10.1353/foc.2013.0005

Denning, JT. (2017). Born Under a Lucky Star: Financial Aid, College Completion, Labor Supply, and Credit Constraints. W.E. Upjohn Institute for Employment Research. https://research.upjohn.org/cgi/viewcontent.cgi?referer=&httpsredir=1&article=1285&context=up_workingpapers

Franke R. (2016). Examining the Role of the State: Needs-Based Grants and Their Effect on Student Persistence and Degree Completion. AERA Online Paper Repository. Presented at the Annual Meeting of the American Educational Research Association, Washington DC, April 8-12. http://ccrc.tc.columbia.edu/media/k2/attachments/impact-pell-grant-eligibility-community-college-students.pdf

Missouri Department of Agriculture (DoAg). (2009). Large Animal Veterinary Student Loan Program. Division 30, Chapter 11. 2 CSR 30-11.010 https://s1.sos.mo.gov/cmsimages/adrules/csr/current/2csr/2c30-11.pdf

Missouri Department of Health & Senior Services (DHSS). (2024). Health Professional Loan and Loan Repayment Programs. https://health.mo.gov/living/families/primarycare/hpl-lr/index.php

Missouri Department of Higher Education & Workforce Development (DHEWD). (2023). 2023 Annual Report. https://dhewd.mo.gov/about/2023-annual-report

Missouri Department of Higher Education & Workforce Development (DHEWD). (2023). Comprehensive Fee Data for Missouri Public Institutions: FY 2024 PDF – Missouri Public Two and Four Year Colleges. https://dhewd.mo.gov/media/file/fy-2024-pdf-missouri-public-two-and-four-year-colleges

Missouri Department of Higher Education & Workforce Development (DHEWD). (2012). WBD 2012 Annual Report. https://dhewd.mo.gov/wbd-2012-annual-report

Missouri Department of Higher Education & Workforce Development (DHEWD). (2007). Table 14: Tuition and Required Fees for Typical Full-Time Students (30 Hrs. Annualized Credit) Enrolled in Public Institutions for the 2006-2007 Academic Year. https://dhewd.mo.gov/media/pdf/table-14-15-2006

National Center for Education Statistics (NCES). (2022). Financial Aid: What is the percentage of undergraduate students awarded Pell grants? https://nces.ed.gov/ipeds/TrendGenerator/app/build-table/8/35?rid=2&cid=6

Park, RSE & Scott-Clayton J. (2017). The Impact of Pell Grant Eligibility on Community College Students’ Financial Aid Packages, Labor Supply, and Academic Outcomes. Center for Analysis of Postsecondary Education and Employment (CAPSEE). Columbia University. http://ccrc.tc.columbia.edu/media/k2/attachments/impact-pell-grant-eligibility-community-college-students.pdf

Riegg Cellini, S. (2021). For-Profit Colleges in the United States: Insights from Two Decades of Research. Annenberg, Brown University. EdWorking Paper No. 21-398. https://edworkingpapers.com/sites/default/files/ai21-398.pdf

State Higher Education Finance (2024). State Profile: Missouri. https://shef.sheeo.org/state-profile/missouri/

State Higher Education Finance (2023). State Higher Education Finance (SHEF) Report: Net Tuition and Total Education Revenue. https://shef.sheeo.org/report-2/?report_page=net-tuition-and-total-education-revenue

U.S. Department of Education (U.S. DoE). (2024). Federal Pell Grant program. Federal Student Aid. https://studentaid.gov/help-center/answers/article/federal-pell-grant-program

Woo JH, Bentz AH, Lew S, Dunlop Velez E, Smith N, Simone SA. (2017). Repayment of Student Loans as of 2015 Among 1995-96 and 2003-05 First-Time Beginning Students. National Center for Education Statistics, U.S. Department of Education. 2018-410. https://nces.ed.gov/pubs2018/2018410.pdf