Unintended Consequences of State Merit-Based Aid

Study finds that Florida’s Bright Futures program impedes enrollments in scientific fields. In another study, Penn State, dissatisfied with 84 percent graduation rate, examines why low-income students finish (or don’t).
May 29, 2008

It is by now well-established that the high profile and expensive merit-based financial aid programs that numerous states have established to keep their best and brightest in college within state borders are far from the panacea their supporters envisioned. While the programs have often accomplished the goal of encouraging top-notch high school students to attend local colleges and making college more affordable for state residents, they have been criticized for disproportionately favoring higher-income students over those from low-income backgrounds and doing relatively little to encourage students who might not otherwise have gone to college to do so.

A study presented this week at the annual forum of the Association for Institutional Research suggests that, at least in one case, a state merit-based financial aid program may be working directly at odds with another priority that is near the top of concerns of most state and federal policy makers and educators: increasing the flow of Americans into scientific and technological fields.

The study, by Shouping Hu, associate professor of higher education at Florida State University, looks at his state’s “Bright Futures” program, which is one of numerous state programs designed in the image of Georgia’s Hope Scholarship Program, the first of its kind. Bright Futures, the second largest such program in the country, provides full-tuition scholarships at public colleges and comparably sized grants to private institutions to students who achieve certain minimum grade point averages in high school, and requires recipients to keep their college GPAs at certain minimum levels to sustain their awards.

Using Florida’s Education Data Warehouse, which is among the most inclusive data systems in the country for tracking the flow of students throughout a state’s educational system and into its work force, Hu examined the distribution of enrollments in various college disciplines before and after Bright Futures took effect in 1997.

What he found is that in 1995 and 1996, the two years before Bright Futures took effect, 47.5 percent of students who enrolled in degree programs at Florida’s public colleges did so in science, technology, engineering or mathematics (STEM) disciplines. In 1998 and 1999, the two years after Bright Futures took effect, 38.5 percent did, and the numbers appeared to be dropping, from 39.2 percent in 1998 to 37.7 percent in 1999.

Recipients of the Bright Futures scholarships were more likely than other students to enroll in STEM fields; in 1999, 29.3 percent of non-recipients of the merit-based scholarships enrolled in scientific and technological disciplines, compared to 34.2 and 45 percent of students who received the two types of Bright Futures grants, known as Florida Academic Scholars and Florida Medallion Scholars awards. But even the Bright Futures recipients were less likely to enter STEM fields than the average student was before the program began.

What explains the decrease in enrollment in science and math fields? “One plausible explanation,” Hu writes, is that students may have sought to “bump up” their college grades to try to qualify for, or increase the size of, their merit awards. “That is, merit-based financial aid using college GPA as a criterion for renewal could provide incentives for students not to choose degree programs in science and engineering” – which are generally seen as more difficult, Hu notes – “so that they have a better chance to qualify for the merit-based financial aid.”

Given the intense concern among state and federal policy makers about a perceived undersupply of American scientists and engineers, which has prompted significant new federal financial aid programs and many efforts at the state level, “some modifications of the current merit aid programs may be warranted,” Hu concludes.

When 84% Isn't Good Enough

Many a public university might rest on its laurels when 84 percent of its undergraduates earn degrees within six years. But while that graduation rate puts Pennsylvania State University in the upper tier of public universities, its institutional researchers have been immersed in a multiyear project aimed at figuring out why one group of students -- those from low-income backgrounds -- are so much less likely to graduate. Only 20 percent of the students who come from the bottom quintile of family income and have low grade point averages in their first semester at Penn State go on to graduate, while comparably performing students from high-income backgrounds graduate at a rate of 36 percent and high-performing, high-income students graduate at a rate of 89 percent.

"Even though we have a really high graduation rate, we realize there's a big disparity for lower-income kids," says Michael J. Dooris, director of planning research and assessment at Penn State and a co-author of the paper, with Marianne Guidos, a quality and planning research associate. "There's a tendency for some faculty to say, 'Geez, how much better can [our graduation rate] be?' But when you show them the data, they say, 'Yeah, there's a problem here for some of our students.' "

To try to get at that problem, Dooris and his colleagues sought to compare the 20 percent of low-income students go on to graduate after struggling in their first semester with the strong majority who don't, with the hope that the analysis might provide some clues for what Penn State might do to improve the odds for all of them. It's not that Penn State is abandoning its efforts to try to increase access to college for low-income students -- far from it, Dooris notes, it has been steadily increasing its financial aid budget -- but as many college officials are concluding, "we have to focus on what happens to the kids who come here."

The overall picture that emerges from the comparison of the survivors to those who don't get through is not terrifically heartening, Dooris acknowledges. There are some bright spots: There is "no statistical evidence" that the 20 percent of low-income students who go on to graduate have stronger academic skills than those who do not, which means that "skills deficiencies can be overcome." "The ones who graduate are probably going in and taking remedial English or math and it works for them," Dooris says. While "some faculty believe that some of these kids are hopeless, when you look carefully at it, there's no evidence of that."

Among other characteristics, students with single parents were half as likely as peers with married parents to graduate, and students at Penn State's main campus -- where admissions standards are higher -- were three times likelier than those at its many branch campuses to earn degrees. Family income was generally not a determining characteristic, suggesting that "while affordability is clearly an issue in general for students at this university, there is not much difference (other things being equal) in the chances of earning a degree between the relatively low-income and the lowest-income students."

In terms of characteristics that appeared in the data to point the way to success, students who participated in work study and the passed most of their first semester course work seemed were more likely to graduate than were their peers. "These are clues, at least, that summer orientation programs, good advising, first-year seminars and similar mechanisms for students to successfully transition to college might be especially valuable for students who are most at risk," the authors write -- consistent, they note, with prevailing wisdom in scholarly research on student success.

So far, at least, says Dorris, the research, while useful, has not produced any magic bullets. "We're not solving this problem by a longshot," he acknowledges. "There's a real problem, and to some extent, it's a social and a cultural problem. But this kind of study suggests that if we keep working at it, we can make a difference, and we have no alternative but to do that."


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