At the same time that the number of degree earners in the U.S. was increasing—from about 1.24 million graduates at four-year institutions in 2001 to about 1.98 million graduates in 2018—students were also taking longer and longer to complete those “four year” degrees, driving up costs and raising the risk of non-completion for even the most able students. The reasons are myriad, but in the mid-2010s, universities across the country began adding a new support, called “completion grants,” to help speed up such students and get as many near-completers across the degree finish line as possible. A new study looks at the impacts of this intervention.
Completion grants are aimed at a specific subset of students who are near degree completion but experiencing a financial burden likely to either slow down their progress or force them to dropout altogether. Georgia State University’s Panther Retention Grants, started in 2011, are the genesis of the model. It has since spread to institutions across the country, with programs funded by private donors, state government, and philanthropic organizations.
The researchers conducted a randomized-controlled trial of the efficacy of completion grant programs at a group of eleven public institutions that are open- and broad-access. The schools are located in ten different states and average 25,000 undergraduates each. In 2019, the average four- and six-year graduation rates among them in 2018 were just 30 percent and 56 percent, respectively. And the average cost of attendance for in-state students was just over $25,000 a year, with half of all students using federal loans to pay for college.
The schools’ grant programs were independently operated but shared broad similarities. Students did not apply for the grants. Rather the money was awarded based on administrative records indicating that students were near completion (having earned at least 75 percent of the credits required for their degree) and had unmet financial need, as defined by a balance due to the institution or a shortfall of funding for living expenses. Other eligibility requirements included FAFSA completion, an Expected Family Contribution of $10,000 or less (that is, within 200 percent of Pell Grant eligibility), compliance with satisfactory academic progress requirements as defined by the institution, in-state residency, and a current course load of at least six credits.
Using these criteria, the institutions identified 14,226 eligible students in summer 2018. They conducted a random lottery with separate draws for Pell recipient and non-recipient students. Across universities, 2,231 students (16 percent of those identified as eligible) were selected to receive grants. The remainder formed a control group receiving no additional funds. The average grantee received approximately $1,200, with the highest award totaling $3,000. Funds were awarded for up to one academic year, with some institutions awarding the full grant in the fall and others splitting it up between fall and spring semesters. Grants were automatically distributed without any action required of students, and were received no later than two weeks following the start of term. Communications to students stressed that no repayment of funds would ever be required. More on that below.
The researchers measured degree progression for all 14,226 eligible students—recipients and non-recipients alike—for three years following distribution of the funds. On the retention side, 95 percent of all students identified as eligible for a grant graduated or remained enrolled within three years, with or without receiving a grant. As for completion—the intended goal of the program—two-thirds of all those who did not drop out went on to complete degrees. However, the vast majority of completers (89 percent) took two further academic years to do so. Not exactly a fast track. There was no statistically-significant difference between grant recipients and non-recipients in terms of completing a four-year degree or the time needed to earn such a degree. At best, grant recipients saw a 1 percentage point higher rate of retention in the first year than their non-recipient peers, a barely-significant boost that also quickly dissipated in the following years. Additionally, there were no differential impacts observed for low-income students or racial or ethnic minority students as compared to their higher-income and white peers.
The data are clear that completion grants as operationalized in these universities do not provide the intended benefits but offer no clarity on why that is case. The researchers point to student survey responses, which indicate a lack of understanding among grant recipients as to why they received the funds (and ignorance among a small number of respondents that they received any additional money at all), despite the detailed communication provided. The implication: If students don’t know that they are being incentivized to finish (and to do so expeditiously), they experience no additional motivation to do either. The researchers also suggest that the no-requirements, “free money” award process actually plays into the lack of understanding among recipients. They recommend a more active completion grant model, involving more and better communication, as well as engaging more directly with eligible students, such as via deans or counselors. It could also be that there is more than just financial concern standing between these near-completers and the degree finish line—changing majors, excess electives, family commitments, etc.—and that no amount of money would be enough to overcome them.
SOURCE: Sara Goldrick-Rab et al., “Affording Degree Completion: An Experimental Study of Completion Grants at Accessible Public Universities,” Board of Governors of the Federal Reserve System (July 2023).
