Financial Aid for Future Educators: Assessing a Federal Grant’s Impact on Student’s Postsecondary Decisions

• In Event: Mitigating Financial Barriers for Teaching Candidates: Federal, State, and Local Approaches to Service Scholarships

Abstract

In 2007, Congress created the Teacher Education Assistance for College and Higher Education (TEACH) Grant program, one of the largest federal aid efforts aimed specifically at strengthening the teacher workforce. Through this program, students can get up to $4,000 per year if they agree to teach in high-need subjects and low-income schools after graduating. In this paper, I use longitudinal administrative data to look at how the TEACH Grant has been put into practice across a large system of public four-year universities, paying particular attention to its effects on student borrowing, financial aid packages, and whether students finish their teacher preparation programs.

Although the majority of preservice teachers qualify to receive a TEACH Grant, I find that only a small proportion of these eligible students actually participate in the program. However, there is significant variation in the number of participants across both institution and program, suggesting both that more universities and programs might consider participating in the program and that even at participating institutions there is an opportunity for colleges and program leaders to do more to get the word out and make sure eligible students know about the program. This matters especially considering that data shows that students who participate in TEACH tend to have stronger academic backgrounds and are more racially diverse than other students who do not participate.

To understand how the grant affects student borrowing, I utilized a number of fixed-effect approaches, some of which compare students to themselves in years when they did and did not receive a TEACH Grant and others that compare grant recipients to similar classmates in the same major and at the same institution who didn’t receive a grant. In short, I find that on average TEACH Grant recipients do not take on less loan debt in years when they participate in TEACH compared to years when they do not. However, these grants do help lower the out of pocket cost students face to participate in teacher preparation programs, if they have unmet need after receiving their financial aid packages. Finally, I estimate that students who get a TEACH Grant are around 7 percentage points more likely to stay in and complete their teaching degree compared to similar peers who didn’t participate. This points to the potential important role TEACH grants may play in supporting students to complete their teaching degree programs.

Overall, this study points towards several important considerations for policymakers. First, federal policymakers might consider ways to ensure TEACH grant awards aren’t offset by the reallocation of other aid awards, such that postsecondary students see more benefit from participating in TEACH. Additionally, policy makers at all areas might consider ways to increase messaging around TEACH participating and couple TEACH grants with other state programs to both increase program participation, strengthen the production of new teachers, and increase benefits to students.

Author

• Wesley Morris, University of North Carolina - Chapel Hill