Low Income Students in Canada: Low Income Students in Canada:

How They Access and Pay for PSEHow They Access and Pay for PSE

Ross FinnieRoss Finnie

Graduate School of Public Graduate School of Public and International Affairsand International Affairs

UniversityUniversity of Ottawa of Ottawa

rfinnie@uottawa.carfinnie@uottawa.ca

  

A) Overview of A) Overview of

the Canadian the Canadian

PSE SystemPSE System

Start with “K-12” SystemStart with “K-12” System

Almost entirely publicAlmost entirely public Generally good qualityGenerally good quality Most finish (90%+)Most finish (90%+) Gender issue begins to show…Gender issue begins to show…

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Kinds of PSEKinds of PSE

Almost all public – limited privatesAlmost all public – limited privates TypesTypes

–Trade/vocational schoolsTrade/vocational schools

– Community collegeCommunity college

– University (“college” in U.S.)University (“college” in U.S.)

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Direct Costs of PSE Direct Costs of PSE

Tuition/fees generally reasonableTuition/fees generally reasonable– 0-$3k for college0-$3k for college

–$2-6k for university$2-6k for university

Not related to instit. qualityNot related to instit. quality Rationing by “ability” (grades)Rationing by “ability” (grades)

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Student Aid – Front EndStudent Aid – Front End

Eligibility related to “need”Eligibility related to “need” Generous – up to $15k/yrGenerous – up to $15k/yr More loans than grantsMore loans than grants Generally enoughGenerally enough

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Student Aid – Back EndStudent Aid – Back End

Increasingly “income sensitive”Increasingly “income sensitive” ““ICR”/”ICL” banished from lexiconICR”/”ICL” banished from lexicon But not from policy developmentsBut not from policy developments

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Changes Over TimeChanges Over Time

Bank lending with guaranteesBank lending with guarantees Bank lending with default premiumBank lending with default premium Fully government systemFully government system They can all work…They can all work…

88

Does it Work?Does it Work?

Pretty wellPretty well Although too complicatedAlthough too complicated Are some put off by borrowing?Are some put off by borrowing? Or by paying?Or by paying? Not clearNot clear

99

  

B) ACCESS: B) ACCESS:

““Who Goes?”Who Goes?”

  

1. “Barriers to PSE”:1. “Barriers to PSE”:

The Wrong The Wrong TerminologyTerminology

““Barriers” suggests…barriers!Barriers” suggests…barriers! For those who For those who want want to go…to go… Not usually the issueNot usually the issue More More about about wanting to gowanting to go And preparing for itAnd preparing for it

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2. Overall Access 2. Overall Access RatesRates

No PSE College University(%) (%) (%)25.6 32.9 41.6

Access rates at age 21

Went to PSE

Nothing prevented PSE

Financial situation (needs to work / costs too much) Admissibility

Lack of interest

74.7 14.8 6.2 0.7 1.7

Did not go to PSE

Reasons for NO PSE at age 21

Reasons for no PSE by Family Income

TotalLess than $25,000

$25,000 to $50,000

$50,000 to $75,000

$75,000 to $100,000

$100,000 and more

All respondents who have never taken PSE (6747 obs.)Nothing 43.9 30.8 41.3 49.1 48.6 43.1

Financial situation 18.3 24.8 21.0 14.9 17.1 14.5

Admissibility 3.8 3.8 3.4 3.4 4.8 4.6

Lack of interest reasons /Undecided education expectation13.5 12.6 12.8 11.7 15.6 18.9

Expected HS or lower 14.3 18.8 15.1 15.7 9.9 10.2

Other/Unknown 6.1 9.2 6.3 5.2 4.0 8.8

Some First Main Results…Some First Main Results…

Access rates highAccess rates high Money not usually the “barrier”Money not usually the “barrier” Some variation by income levelSome variation by income level But “money” is not “affordability”But “money” is not “affordability”

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3. 3. Family Income Vs. Family Income Vs. Parental EducationParental Education

23-04-2123-04-21 2222

The Access Story LineThe Access Story Line

Income effects moderateIncome effects moderate Parental education dominatesParental education dominates A gender story on incomeA gender story on income

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4. What Do Income and 4. What Do Income and Education Capture?Education Capture?

Income Related to…Income Related to…

Not gradesNot grades Not other HS variablesNot other HS variables But reading scores, yesBut reading scores, yes Smallish but robust effectSmallish but robust effect

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Education Related to…Education Related to…

Grades (unlike income)Grades (unlike income) Not HS variables (again)Not HS variables (again) Reading Scores (again)Reading Scores (again) More related to backgroundMore related to background

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5. The Home 5. The Home EnvironmentEnvironment

The Family Matters!The Family Matters!

Family environment, habits, Family environment, habits, experiences matter!experiences matter!

Related to income, educationRelated to income, education ““Cultural capital”?Cultural capital”? Sociology as well as economicsSociology as well as economics

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6. Access: 6. Access:

A SummaryA Summary

Access: What MattersAccess: What Matters

Many factors matterMany factors matter Inter-related, family-basedInter-related, family-based Effects probably start earlyEffects probably start early ““Culture” more than moneyCulture” more than money

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Policy ImplicationsPolicy Implications

Aid, tuition policies limitedAid, tuition policies limited Given Given costs/aid system in placecosts/aid system in place Need to identify real “barriers”Need to identify real “barriers” Direct policy thereDirect policy there

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C) Pathways

Through PSE

Total Grad.

=Same Prog.

+Diff.

Prog.+

Diff. Inst.

+Diff. Level

+ D.K.

Univ. 69.4 = 52.1 + 6.0 + 4.4 + 4.6 + 2.3

Coll. 73.1 = 56.5 + 5.2 + 5.2 + 1.8 + 4.4

Five-Year Cumulative Total Graduation Rates (%)

Total Graduate

Still in PSE

Not in PSE

Univ. 69.4 20.4 10.2

Coll. 73.1 8.8 18.0

Five-Year Overall Persistence Rates (%)

Reasons for Leaving (%) - University

Switchers Leavers

Not enough money 4.6 15.2

Wanted to work 2.7 7.8

Marks too low 4.5 5.3

Didn't like it/Not for me 28.3 30.5

To change school, program 40.5 10.3

Other 19.4 30.9

New Picture of PathwaysNew Picture of Pathways

Different pathways to graduationDifferent pathways to graduation Overall persistence rates highOverall persistence rates high Money not a big factorMoney not a big factor

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D) Does Very Early Background

Matter?

University Participation Rates at Age 19 by Parental Income from Diff. Age Intervals

0

0.05

0.1

0.15

0.2

0.25

0.3

0.35

0.4

0.45

1st Quin 2nd Quin 3rd Quin 4th Quin 5th Quin

Age 0-4

Age 5-9

Age 10-14

Age 15-17

Effects Start Effects Start Very Very EarlyEarly

Effects vary by child’s ageEffects vary by child’s age Research just startedResearch just started Important policy implicationsImportant policy implications

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E) The L-SLIS: A New Resource

-Information Available

-Sample Frame

23-04-2123-04-21 4141

23-04-2123-04-21 4242

(%)

  

E) Student Borrowing: E) Student Borrowing: Repayment and Repayment and

BurdensBurdens

Proportion of Debt Repaid by Degree Level, Cohort and Sex

0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

0.80

Male Female Male Female Male Female Male Female

1986

1990

1995

College/CEGEP Bachelor's Master's Doctorate's

Incidence of Difficulties in Payback by Degree, Cohort and Sex

0

5

10

15

20

25

30

35

40

Male Female Male Female Male Female Male Female

(%)

1990

1995

College/CEGEP Bachelor's Master's Doctorate's

  

F) Conclusion: Who F) Conclusion: Who Goes, Who Stays, Goes, Who Stays,

What MattersWhat Matters

Access supported by allAccess supported by all Financial aid tooFinancial aid too ““Barriers” mostly socio-economicBarriers” mostly socio-economic The next policy challenge..The next policy challenge..

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