To meet future demand for educated workers, our state must increase college participation and completion among low-income students. Yet there are concerns that the state in not maintaining its investment in higher education. The last decade has seen the beginning of a downward trend in both appropriations to public institutions and spending on need-based aid per capita.

State appropriations per undergraduate student attending public institutions have decreased 33% and need-based grant aid to recipients has decreased 3% since 1980 (see chart). Even though the State Grant aid funding amount appears relatively level, increases in college costs have decreased the buying power of these funds each year.

As for the downward trend in state support for public institutions, state support has not kept pace with growth in postsecondary enrollment. While total combined (need-based and public appropriations) inflation-adjusted dollars dedicated to higher education in Minnesota has increased 23% since 1980, total undergraduate enrollment has increased 65%.

As public funding for higher education has decreased, the onus for paying for higher education has passed through institutions on to students and their families. Student borrowing has steadily increased — up 225% since 1987. In 2009, 73% of students graduated with debt, averaging more than $27,000. This level of debt will limit their ability to fully participate in the economy via the purchase of homes, cars and other goods for years. For many it will also delay or eliminate their ability to start saving for their childrens' education as they pay off their own educational debt.

Minnesota has decreased support for students even though the need for increased educational attainment is widely acknowledged. The state would benefit from a broader review of these topics and how they intersect, given the likely ramifications of inaction.

For more detail, see the Minnesota Private College Research Foundation Research Brief, "Minnesota Educational Needs and Higher Education Finance Policy." The brief includes analysis of demand for postsecondary-educated individuals, trends in socioeconomic change, college participation of low-income students and policy responses to financing postsecondary education.