Investment in Higher Education for Growth and Opportunity

Posted by Keystone Research Center on November 10, 2014

A Must-Have for Pennsylvania Part II: Investment in Higher Education for Growth and Opportunity

Executive Summary

Pennsylvania’s deep cuts in funding to K-12 education since 2010-11 have drawn a great deal of attention in recent months. Less widely recognized is the fact that Pennsylvania enacted even deeper cuts, on a percentage basis, to funding for public higher education in the same period. Four-year colleges received the largest reductions in funding, including an 18% cut to state support for the Pennsylvania’s most affordable four-year options, the 14 state-owned Pennsylvania State System of Higher Education (PASSHE) universities. Even before these cuts, Pennsylvania ranked low among states in funding for higher education and in the affordability of public higher education. Given the importance of higher education to economic growth and to opportunity for individuals, underinvesting in higher education represents a clear case of shooting ourselves in the foot. Short-sighted decisions to manage the state’s recovery through cuts alone, rather than raise the revenue needed to invest adequately in higher education, sacrificed the longtime well-being of the Commonwealth and its citizens. These cuts have also held back the state’s economic recovery, especially in more rural areas that are home to the state-owned schools.

This report summarizes key insights from the economic research literature on the importance of higher education. It then presents basic information on Pennsylvania’s investment in higher education. We focus especially on the 14 public community colleges and 14 state-owned universities that are the most affordable and accessible to middle- and low-income Pennsylvania families. In many comparisons with other states we also include in our analysis Pennsylvania’s investment in state-related higher education institutions (Penn State University, Pitt, Temple, and Lincoln).State support for those institutions is included in the main national databases that compare public higher education funding and tuition, across the 50 states.

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