Students get financial aid at highest rate since WWII

Mary Beth Marklein | USA TODAY

More college students are receiving loans, grants and other financial aid than at any time since the debut of the GI bill after World War II, new data show.

Seventy-one percent of all undergraduate students received some type of financial aid in the 2011-12 academic year, up from 66% four years earlier (2007-08), data released Tuesday by the National Center for Education Statistics (NCES) show. The average amount was $10,800, up from $9,000 four years earlier.

Most of the increase in student aid is coming from federal sources. Last year, 57% of undergraduates received some form of federal aid, including grants, loans and work-study funds, up from 47% four years earlier. Over the same period, the percentage of undergraduates receiving state aid or help from their college remained relatively flat, at 15% and 21%, respectively.

"States definitely weren't able to provide as much as they have in the past," said Jack Buckley, commissioner of NCES.

The data are being released as President Obama prepares this week to discuss how to make college more affordable for middle-class families. While federal aid is important, the Obama administration also has been pressing colleges to rein in costs.

Noting that average tuition and fees at four-year public colleges have increased more than 250% over the past 30 years, Obama said Tuesday he has "made it a personal mission to make higher education more affordable" and intends to propose changes that "won't all be popular with everyone."

Paul Lingenfelter, president of the non-profit State Higher Education Executive Officers, says state support for student aid has increased, from $6.8 billion in 2007 to $8.3 billion last year, but so have student enrollments and college tuition. He says it would be wrong to interpret the new data as evidence that states are "pulling back" from student aid.

Neal McCluskey, associate director of the Cato Institute, a libertarian think tank, says several factors affect college prices but says the newly released data support his argument that colleges largely raise their prices because financial aid, especially federal, lets them.

"Basically, the aid ensures that students can pay almost anything they are charged," he says.

Other findings from the 2011-12 academic year: