Study: Pell Grant Makes Difference for Students of Color

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by Charles Dervarics

African American and Hispanic students who receive a federal Pell Grant are more likely to finish college and pursue science, technology, engineering and mathematics (STEM) majors, says a new report that argues for a renewed commitment to the grant program.

Pell’s effect is dramatic on the college success of low- and middle-income students, said Dr. Lamont Flowers, executive director of the Charles H. Houston Center for the Study of the Black Experience in Education at Clemson University. Examining longitudinal data beginning in 2004, he found that 35 percent of low-income African-American students with a Pell Grant earned a degree compared with 23 percent of low-income African-Americans without such a grant.

Even among wealthier families with incomes above $89,000, African-American students who had ever received a Pell Grant posted a 53-percent graduation rate compared with 38 percent for African-American students who never received such federal help.

Based on such data, attempts to reduce Pell investments or make cost-saving reductions “should be avoided at all costs,” Flowers said in Attaining the American Dream: Racial Differences in the Effects of Pell Grants on Students’ Persistence and Educational Outcomes.

Similar trends were evident among Hispanic students, he concluded. Among low-income Hispanics, 45 percent of those with Pell Grants ultimately earned a degree, compared with 25 percent for those without a grant. Hispanics from middle- and higher-income families also were more likely to graduate if they had received Pell support at some point.

The findings “speak to the importance of the Pell grant program in terms of diversifying postsecondary education,” Flowers told Diverse.

For those seeking higher STEM enrollments, the study also provided important evidence. One-third of African-American Pell recipients majored in these disciplines, compared with 23 percent for African-Americans without a Pell Grant, the study noted.

The same trend occurred among Hispanics, as 27 percent of Pell recipients majored in STEM fields. The rate for Hispanics who did not have a federal grant was 17 percent.

Hispanic Pell Grant recipients also were more likely to earn A’s and B’s in college than non-recipients, the study noted. But there was little difference in grades among African-Americans based on Pell status.

Despite evidence of Pell’s importance, the program is facing increasing fiscal pressure, the study noted. Since 1975, the number of Pell-eligible students has increased from 2 million to nearly 12 million with a resulting increase in outlays, particularly in recent years. The program had $30 billion in expenditures in 2009-2010, or $10 billion above congressionally approved appropriations, the study said.

While such trends result in funding shortfalls, Flowers cautioned policymakers not to reduce the program’s scope. Instead, lawmakers should focus on “decreasing the administrative costs of the program as well as increasing the maximum Pell Grant award.”

Despite Pell’s importance, numerous studies note that many low-income students fail to take advantage of the program. The U.S. Government Accountability Office, for example, has said that hundreds of thousands of students eligible for aid do not apply.

While the federal government and others are doing more to publicize the program, Flowers said colleges and universities should provide a Pell Grant “calculator” that would provide estimates to families about potential aid. Such a resource could build on a college cost calculator that post-secondary institutions must provide following passage of federal legislation in 2008, he said.

The current maximum Pell Grant is $5,550.

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