This article was originally published in August 2017.
Life Course Centre Research Fellow Professor Leslie Stratton has released a working paper on the link between housing prices, unemployment, disadvantage and progress towards a degree.
In her working paper summary, Professor Stratton explains that when young men and women contemplating college consider the costs of doing so (both the direct costs, and the indirect or opportunity costs) local economic conditions – such as the unemployment rate and housing prices – are likely to be a factor in these decisions.
In theory, higher unemployment rates make attending college more attractive, but higher unemployment may also hinder the student’s ability to pay for college. Likewise, rising housing prices can either: create attractive employment and investment opportunities that lure youth away from higher education; or, for home-owning households, give them the ability to finance their higher education. However, as Professor Stratton points out, enrolment does not guarantee completion
Overall, her results – based on the 1996-2001 Beginning Post-Secondary Survey, which follows students entering four-year institutions in the 1995-96 academic year – imply that the rising unemployment rates of the Great Recession may have caused youth from more advantaged households to drag out their undergraduate enrolment, while the falling housing prices may have increased progress toward a degree, particularly for youth from less advantaged households.
Professor Stratton says, ‘While household income and parental education have long been known to be closely associated with college enrolment and progress toward a degree, this paper demonstrates that these measures of household disadvantage play an important role as well in mediating the relation between college outcomes and economic conditions, as measured both by the unemployment rate and especially by housing prices.’
She summarises, ‘Colleges and policy makers should consider the sensitivity of less advantaged students to housing market conditions if they wish to increase college attainment rates for this population.’
Read the working paper ‘Housing Prices, Unemployment Rates, Disadvantage, and Progress toward a Degree’, here.