A dilemma: Post-secondary education is increasingly important for everyone, but it’s also becoming less affordable.
The Greenwood Promise, which provides financial support for Greenwood County students seeking higher education, is a local solution to one of our nation’s biggest economic challenges.
How much a challenge is college affordability? The College Board recently reported national averages in 2016-17 for in‐state tuition and fees at U. S. public, two- and four-year schools:
-- Two-year schools: up 2.3 percent.
-- Four-year schools, up 2.4 percent to $9,650 annually; add room and board, $20,090 annually.
In South Carolina, the College Board reports even worse tuition and fee trends.
South Carolina higher ed is the ninth most costly nationally, driven largely by significant decreases in state funding for post-secondary education.
State-supported, four-year schools are more than $10,000 annually and, while less expensive, tuition and fees have also risen at two-year schools as well.
Can families put money aside to help pay for college? Yes, but the math has changed.
By setting aside 8-10 percent of their annual earnings, previous South Carolinians making the median family income could finance one child’s four-year degree program. Today, it requires about 25 percent of the median family income, the highest rate of any state in the nation.
To have enough money to pay for four years of tuition and fees at a state-supported four-year university, you have to save $3,235 per year, per child, starting when each child enters kindergarten. For most South Carolinians, that is beyond reach.
Can students work their way through college, like many older folks did? Yes, but college costs are rising much faster than wages, more than 300 percent in 15 years.
The result? Student loans are now the single biggest debt in the United States. Total student loan debt has ballooned since 2003 from around $250 billion to $1.2 trillion in 2015, larger than all home mortgages combined. The largest default group is now parents and grandparents who co-signed loans for their children.
Some economists believe student loan debt is dragging down the U.S. economy. Just a decade ago, adults age 20-29 had 13 percent of their total debt tied to student loans and 63 percent to mortgages. By 2015, 37 percent of their total debt was student loans (three times higher) and only 43 percent tied to mortgages (one-third less.) The effect: the positive impact from property taxes, utilities, appliances and landscaping homeownership, all which directly stimulate the local economy, is lessened. Student loan debt, however, does nothing for the local economy so the local economy ultimately suffers.
So, what if higher education were more affordable? That’s where The Greenwood Promise comes in. Phase 1 of the program ensures all students can afford at least a professional certificate, diploma, or associate degree (to start a career or transfer to a four-year university to complete their bachelor’s degree.)
This program, open to all public, private and home-schooled students residing in Greenwood County, provides tuition assistance based on length of residency. These scholarships erase student loan debt for many, as well as encourage people to purchase homes and raise families within the county.
It is crucial for Greenwood County students to have access to affordable post-secondary education. The Greenwood Promise can help students achieve that education and launch a successful life as an adult.
That is why Eaton has chosen to support The Greenwood Promise. It will not only help Eaton be more successful in the future, but also help our colleagues and their families meet the challenges.
Brent Parris received a master’s in business administration from the University of Tennessee at Chattanooga and has held various positions within Eaton’s Electrical and Hydraulics Business Groups for more than 15 years.