Disparities in the American Dream

Affording college is more attainable for some immigrant families than others, according to a new analysis by the Institute for Higher Education Policy, released Friday.

The report found that descendants of immigrants are better able to afford college with each successive generation in the United States. But even so, the data showed that immigrant families of color continue to have higher shares of unmet need—the gaps between their college costs and what they can afford after financial aid—even generations later.

“We need to think about who is able to access the American dream based on race and ethnicity,” said Marián Vargas, senior research analyst at IHEP and author of the report. “And it is so incredibly important to disaggregate data by immigrant generational status and by race and ethnicity, because it helps answer that question.”

Her analysis draws on undergraduate data from the U.S. Department of Education’s 2019–20 National Postsecondary Student Aid Survey. It found that, broadly, smaller shares of second- and third-generation students have trouble affording college: 82 percent of all first-generation immigrant students, those born outside the U.S., couldn’t fully cover college costs, compared to 79 percent of second-generation students with two immigrant parents, 75 percent of second-generation students with one immigrant parent and 72 percent of students whose families immigrated three generations ago or more.

That’s the good news. But trends for immigrants of color and their descendants proved more complicated and troubling.

Asian, Black and Hispanic or Latino immigrant students had higher shares of unmet need—83 percent, 86 percent and 85 percent, respectively—compared to 74 percent of white immigrant students.

The data also found disparities among immigrant groups in the extent to which their ability to afford college improved over multiple generations.

White and Asian immigrant families saw significant declines in shares of unmet need between the first and third generations. The shares of third and subsequent generations of white students and Asian students with unmet need were 67 percent and 71 percent, respectively. But Hispanic or Latino immigrant families had less meaningful gains in their ability to afford college over time. Among Latino students third generation or higher, 81 percent still couldn’t fully cover the costs of college.

Meanwhile, for Black immigrant families, the share of students able to cover college costs fell over generations. In the third generation or beyond, 88 percent of Black students faced unmet need, two percentage points higher than first-generation Black immigrant students.

Vargas said it was a “shock” to her that paying for college became even less attainable for Black students in later generations.

“The total picture says one story—affordability will increase through generations—but the disaggregated picture says something else, which is that immigrant affordability improves for some groups … and not for others,” Vargas said.

The report also found that the degree of unmet need among immigrant families followed similar patterns. Over all, the average size of the gaps between college costs and what students could pay shrank between the first and third generations, and that trend held true across racial and ethnic groups. But immigrant families of color faced more unmet need on average than their white counterparts.

White immigrant students had an average unmet need of $3,442 in the 2019–20 academic year, but students who were third generation and beyond could afford college with an average of about $805 leftover that year. While unmet need similarly fell for Asian, Latino and Black families over generations, third-generation students still typically fell short of covering college costs by at least several thousand dollars. Unmet need for third-generation Asian students was $3,549 on average, compared to $7,110 for first-generation Asian immigrants. Third-generation Latino students faced $5,375 in average unmet need, compared to $6,574 for first-generation Latino immigrant students.

Black immigrant students had the highest average amount of unmet need, $9,106; three generations or more later, their average unmet need had only declined to $8,893.

‘Driving Enrollment Growth’

Vargas said these disparities likely stem from some key challenges the various populations face. Immigrants to the U.S. are disproportionately low-income, she said, so compounded with racial wealth gaps, immigrant families of color often have less to pass on to their children and grandchildren. She also believes systemic racism in and outside the workforce plays a role, including wage gaps between employees of different backgrounds, discrimination in hiring and barriers to wealth-building through homeownership and other means. She added that immigrant families may also be less familiar with the American federal financial aid system, meaning they’re not always accessing their full financial aid benefits.

“I think a lot of the time, these types of studies focus just on immigrant students,” she said, when “it is not just the immigrant that is affected” by such factors. “If you come from a family of immigrants, you’re facing these financial struggles … that lack of financial resources gets transferred.”

Miriam Feldblum, executive director of the Presidents’ Alliance on Higher Education and Immigration, noted that immigrant students are a sizable population, and if immigrant families—particularly those of color—are struggling to afford college, it’s a major problem not just for them but also for higher ed. Recent research by her organization shows that students who are immigrants, or the children of immigrants, account for about one-third of all students enrolled in U.S. colleges and universities, up from one-fifth in 2000. The majority of those students—80 percent— identify as students of color.

These students “are driving enrollment growth in higher education,” Feldblum said. “This is not simply about ensuring college access and opportunity for students, but it has to do with the core viability and sustainability of our higher education system. This is also in the business interests of higher education institutions, of communities and states, because immigrant-origin students are also helping to drive workforce development.”

Vargas would like to see more grants targeted at immigrants, particularly immigrants of color, to help pay for college, as well as more states offering state aid for undocumented students, among other policy shifts. She said the stakes of failing to address these college affordability disparities are high.

“College completion gives you access to economic mobility,” she said. Higher ed risks “perpetuating the cycle of lack of access and lack of completion and lack of economic mobility for over a third of the college-going population.”