More blacks and Hispanics are going to college in the United States than in the past and their parents are more likely than white parents to believe a college degree is crucial for their children to succeed, according to a new Pew Research Center survey.
Eighty-six percent of Hispanics and 79 percent of blacks say a college degree really matters, compared to about two-thirds of whites. Ideas about college value appear to be linked to what each group believes is required to become a member of the middle class, said Renee Stepler, a Pew Research Center research assistant and the report's author. Nearly half of Hispanics believe a college education is key to gaining admittance to middle class America, compared to 43 percent of blacks and 22 percent of whites.
"However, white adults are more likely than black or Hispanic adults to already be in the middle class or higher," the report said.
Stepler told the Deseret News there could be an "aspirational" component because parents in those minority populations are less likely than whites to have earned a degree.
"They may want for their children what they do not have themselves," said Stepler, who added that earning a degree "can have tremendous implications for them financially."
Racial differences
The findings are based on a subset of data from a large "Parenting in America" survey that Pew released in December. That report said, among other things, that black and Hispanic parents are more likely than whites to see their children's successes and failures as a reflection of the job they've done as parents. Whites are more likely to say a child's success or failure reflects his own strengths or weaknesses.
That survey noted other differences by race, as well. "For example, while similar shares of black and white parents say it is extremely important to them for their children to grow up to be honest and ethical and caring and compassionate, black parents place more value than white parents on raising their kids to be hardworking, ambitious and financially independent," it said.
In its just-released close-up look at blacks and Hispanics, Pew researchers found that while high school dropout rates have declined overall over the past 20 years, the driver has largely been much better graduation rates for blacks and Hispanics than in earlier years.
And compared to the past, both groups are more likely to be enrolled in either two- or four-year colleges, though they still lag behind whites and Asians. They are also more likely to earn bachelor's degrees than in the past. In 1993, 8 percent of Hispanics age 25-29 had a degree; in 2014 that had nearly doubled to 15 percent, Stepler said. Among blacks in that age range, 13 percent had a bachelor's degree in 1993, compared to 22 percent in 2014.
Hispanics are more likely to be enrolled in two-year colleges, rather than four-year, she said, and many of them study part-time. She did not have data on that for blacks.
Major impact
Even when someone has a college degree, what it yields may vary from group to group. The Federal Reserve Bank of St. Louis last summer found a college degree gives blacks and Hispanics a mixed bag of benefits. The authors, economists William R. Emmons, the executive vice president, and Bryan J. Noeth, said earning a four-year degree does typically yield higher incomes and greater accumulated wealth. But there's a caveat.
"The income- and wealth-boosting effects of education apply within all racial and ethnic groups. Higher education may also help 'protect' wealth, buffering families against major economic and financial shocks and mitigating adverse long-term trends," they wrote. But, "based on two decades of detailed wealth data, we conclude that education does not, however, protect the wealth of all racial and ethnic groups equally."
They said college-educated blacks and Hispanics have more assets and wealth than those without degrees their median family income was more than twice as high and they had four times the assets as those in their racial groups who didn't have degrees.
But in economically stressful times, they were less likely than whites or Asians to be able to hang onto their wealth. While white and Asian families with four-year degrees made it through the recession much better than those of their race who lack degrees, the Hispanic and black families headed by someone with a degree fared worse than families of their race who lacked a degree. The researchers said that was true both in the recent recession and over the 20-year period ending in 2013.
One reason may be that blacks and Hispanics who had no degrees had less to lose, they noted, but the collapse of the housing market was also particularly devastating to them, particularly for those in minority neighborhoods, where housing values plunged.
The decline in wealth and assets was striking: Between 2007 and 2013, college-grad Hispanics saw net worth drop 72 percent, while African-American college graduates lost 60 percent of theirs, the reserve study said.
Emmons told the Washington Post that concentrations of Hispanic families in parts of the country like California and the Southwest that were "leveled by the housing bust likely contributed to the great loss of wealth." He also noted that blacks and Hispanics don't get the financial "transfer" boosts from inheritance or personal monetary gifts that sometimes help whites make down payments or cover the cost of college.
As a result, higher numbers of them leave college with debt, Emmons said.
Investing in the future
The Annie E. Casey Foundation recently released a policy brief that looks at the racial wealth gap and offers recommendations to close it, including improving savings rates and reducing personal debt loads.
"Investing in Tomorrow: Helping Families Build Savings and Assets" said that "the median net worth of white households was more than 10 times greater than that of African-American or Latino families in 2013. While white families net worth rose by 2 percent from 2010 to 2013, Latino and African-American families net worth fell markedly by 15 percent and 34 percent, respectively. "
It noted that white households have accumulated emergency funds equal to just over a month's income a sum many experts say is still far too little savings while Hispanic households have ready access to the equivalent of about 12 days income and blacks to about five days income.
"These dramatic differences are especially troubling given the critical importance of assets as an engine of the American Dream a dream that is, increasingly, unequally achieved," the Casey report said.
It also noted that financial stability matters on many levels, helping shape how children fare in fundamental ways. "Family assets strongly correlate with indicators of child well-being such as academic performance and self-esteem and help children avoid negative consequences such as behavioral problems and teenage pregnancy," the Casey report said.
The report places a premium on putting money away in savings not just for emergencies, but as an investment.
Starting to save in a childs name from birth can change how kids and their parents think about their future. "Indeed, research shows children with savings accounts in their name are substantially more likely to go to college. As young people become working adults, they should develop their own savings habits, including setting aside funds for emergencies, as well as long-term savings for larger purchases, such as a car or home," it said.
Eighty-six percent of Hispanics and 79 percent of blacks say a college degree really matters, compared to about two-thirds of whites. Ideas about college value appear to be linked to what each group believes is required to become a member of the middle class, said Renee Stepler, a Pew Research Center research assistant and the report's author. Nearly half of Hispanics believe a college education is key to gaining admittance to middle class America, compared to 43 percent of blacks and 22 percent of whites.
"However, white adults are more likely than black or Hispanic adults to already be in the middle class or higher," the report said.
Stepler told the Deseret News there could be an "aspirational" component because parents in those minority populations are less likely than whites to have earned a degree.
"They may want for their children what they do not have themselves," said Stepler, who added that earning a degree "can have tremendous implications for them financially."
Racial differences
The findings are based on a subset of data from a large "Parenting in America" survey that Pew released in December. That report said, among other things, that black and Hispanic parents are more likely than whites to see their children's successes and failures as a reflection of the job they've done as parents. Whites are more likely to say a child's success or failure reflects his own strengths or weaknesses.
That survey noted other differences by race, as well. "For example, while similar shares of black and white parents say it is extremely important to them for their children to grow up to be honest and ethical and caring and compassionate, black parents place more value than white parents on raising their kids to be hardworking, ambitious and financially independent," it said.
In its just-released close-up look at blacks and Hispanics, Pew researchers found that while high school dropout rates have declined overall over the past 20 years, the driver has largely been much better graduation rates for blacks and Hispanics than in earlier years.
And compared to the past, both groups are more likely to be enrolled in either two- or four-year colleges, though they still lag behind whites and Asians. They are also more likely to earn bachelor's degrees than in the past. In 1993, 8 percent of Hispanics age 25-29 had a degree; in 2014 that had nearly doubled to 15 percent, Stepler said. Among blacks in that age range, 13 percent had a bachelor's degree in 1993, compared to 22 percent in 2014.
Hispanics are more likely to be enrolled in two-year colleges, rather than four-year, she said, and many of them study part-time. She did not have data on that for blacks.
Major impact
Even when someone has a college degree, what it yields may vary from group to group. The Federal Reserve Bank of St. Louis last summer found a college degree gives blacks and Hispanics a mixed bag of benefits. The authors, economists William R. Emmons, the executive vice president, and Bryan J. Noeth, said earning a four-year degree does typically yield higher incomes and greater accumulated wealth. But there's a caveat.
"The income- and wealth-boosting effects of education apply within all racial and ethnic groups. Higher education may also help 'protect' wealth, buffering families against major economic and financial shocks and mitigating adverse long-term trends," they wrote. But, "based on two decades of detailed wealth data, we conclude that education does not, however, protect the wealth of all racial and ethnic groups equally."
They said college-educated blacks and Hispanics have more assets and wealth than those without degrees their median family income was more than twice as high and they had four times the assets as those in their racial groups who didn't have degrees.
But in economically stressful times, they were less likely than whites or Asians to be able to hang onto their wealth. While white and Asian families with four-year degrees made it through the recession much better than those of their race who lack degrees, the Hispanic and black families headed by someone with a degree fared worse than families of their race who lacked a degree. The researchers said that was true both in the recent recession and over the 20-year period ending in 2013.
One reason may be that blacks and Hispanics who had no degrees had less to lose, they noted, but the collapse of the housing market was also particularly devastating to them, particularly for those in minority neighborhoods, where housing values plunged.
The decline in wealth and assets was striking: Between 2007 and 2013, college-grad Hispanics saw net worth drop 72 percent, while African-American college graduates lost 60 percent of theirs, the reserve study said.
Emmons told the Washington Post that concentrations of Hispanic families in parts of the country like California and the Southwest that were "leveled by the housing bust likely contributed to the great loss of wealth." He also noted that blacks and Hispanics don't get the financial "transfer" boosts from inheritance or personal monetary gifts that sometimes help whites make down payments or cover the cost of college.
As a result, higher numbers of them leave college with debt, Emmons said.
Investing in the future
The Annie E. Casey Foundation recently released a policy brief that looks at the racial wealth gap and offers recommendations to close it, including improving savings rates and reducing personal debt loads.
"Investing in Tomorrow: Helping Families Build Savings and Assets" said that "the median net worth of white households was more than 10 times greater than that of African-American or Latino families in 2013. While white families net worth rose by 2 percent from 2010 to 2013, Latino and African-American families net worth fell markedly by 15 percent and 34 percent, respectively. "
It noted that white households have accumulated emergency funds equal to just over a month's income a sum many experts say is still far too little savings while Hispanic households have ready access to the equivalent of about 12 days income and blacks to about five days income.
"These dramatic differences are especially troubling given the critical importance of assets as an engine of the American Dream a dream that is, increasingly, unequally achieved," the Casey report said.
It also noted that financial stability matters on many levels, helping shape how children fare in fundamental ways. "Family assets strongly correlate with indicators of child well-being such as academic performance and self-esteem and help children avoid negative consequences such as behavioral problems and teenage pregnancy," the Casey report said.
The report places a premium on putting money away in savings not just for emergencies, but as an investment.
Starting to save in a childs name from birth can change how kids and their parents think about their future. "Indeed, research shows children with savings accounts in their name are substantially more likely to go to college. As young people become working adults, they should develop their own savings habits, including setting aside funds for emergencies, as well as long-term savings for larger purchases, such as a car or home," it said.