Although it may sometimes seem ubiquitous, the federal work-study program actually doesn't reach many college students. And the money, which subsidizes part-time jobs, often flows to institutions that primarily educate wealthy and middle-class populations. That's a problem, because a recent study finds that work-study aid can be instrumental in helping help low-income students graduate.

Researchers at Teachers College, Columbia University analyzed federal survey data, and found that students were more likely to complete bachelor's degrees in six years when they received work-study aid. The effect was greater for low-income students and students with low SAT scores.

Work-study jobs don't pay much — on average, $1,670 per year — but they're designed to be convenient for students. They're usually on campus or close by, and offer flexible hours. "For a lot of students at big public institutions or community colleges that are getting very little of this money, they are working a lot anyway, and they're working at jobs that are not that complementary with their schoolwork," says Judith Scott-Clayton, the Columbia study's lead author.

Work-study aid currently reaches about 704,000 undergraduate and graduate students a year. Students' wages come both from the government and from the college they attend (or another eligible employer). The amount of money a college gets depends on the amount of money it received the year before and whether its student body can afford its tuition.

The funding formula, which has been in place for decades, leads to some odd outcomes. Many of the institutions that get lots of funding are elite private universities or selective public flagships. At 11 of the 20 institutions that received the most federal money in 2012-2013, less than 25 percent of undergraduates received need-based federal Pell Grants.

National Journal
National Journal

Thirty-eight percent of undergraduates who are dependent on their parents and get work-study money hail from middle-class families. Middle-class families need help paying for college, too, especially at expensive institutions like Columbia. But if the program served more low-income students, who may experience a greater academic benefit from it, the money would arguably be distributed more efficiently.

It's also worth noting that three of the 20 institutions that received the most funding in 2012-13 were run by publically traded companies: DeVry, ITT Technical Institute, and Argosy. While for-profit institutions like these serve large numbers of low-income students, they often don't serve them well. The Consumer Financial Protection Bureau is currently suing ITT Technical Institute for predatory lending practices.

Young Invincibles, a nonprofit, recently proposed some tweaks to the program's funding formula, including aligning work-study money with the share of Pell-eligible students an institution enrolls and graduates, and making work-study jobs more like internships. If that kind of reform was in place, the report authors said in a statement announcing the report, every dollar spent on the program would count.

This article is part of our Next America: Higher Education project, which is supported by grants from the Bill & Melinda Gates Foundation and Lumina Foundation.

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