Earning a college education benefits families and the economy for generations. Unfortunately, students from low-income homes are earning degrees at the lowest rate in three decades. Washington needs to cash in their economic potential by helping them save for college.
Two years into economic recovery from the Great Recession, over 46 million Americans live in poverty, including 16 million children, according to the latest data released by the US Census Bureau. But beyond these staggering numbers, the report also clearly identifies a key investment opportunity that could produce higher incomes, lower rates of poverty, a more resilient labor force, and even higher tax revenue.
To cash in on the investment, America needs to help poor children and their families save for college. A growing body of evidence demonstrates strong links between savings and educational outcomes, such as increased academic performance, college attendance, and degree completion, even after controlling for factors like income. Helping more poor students go to college generates benefits that compound throughout their lives, their children’s lives, the economy, and throughout local, state, and federal budgets.
It has long been true that a college education increases job security, earnings, and economic mobility. And this latest Census data shows that workers with more education have been better able to weather the recession’s storm. The unemployment rate, for example, for college graduates is half of that of high school graduates, and their poverty rate is less than a third of the national average.
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