Federal Work Study as an Ever Decreasing Percentage of Tuition

It’s rarer than ever to hear someone say “I worked my way through college.” With  tuition rates rising at nearly double the rate of general inflation, a student working under the Federal Work Study Program cannot realistically make a substantial dent in the tuition bill, let alone have money left over to pay the sum of room and board, books, a laptop, and minimal spending cash.

The federal minimum wage is $7.25/hour effective July 24,2009. Let’s assume the student gets paid the relatively generous amount of $11/hour for a library job, and works 20 hours a week term-time (a difficult amount to guarantee, given the student’s need to, well, study during the term). That’s $187 a week given a tax rate of 15% (yes, work study is subject to federal and state income taxes). There are roughly 40 school weeks in a year. The student can make up to $7480 a year, and that’s by working 20 hours a week in addition to being a full-time student. The student can cover 28% of  tuition, room and board at an average private four year university (averaging $26,273 in 2009) or 15.3% of the tuition, room and board at Harvard ($48868 in 2009).

In 1980, the average annual cost of tuition, room and board at an average private 4-year institution was $3499 and $11000 at Harvard. The federal minimum wage was $3.10.hour, and lets again assume the student gets paid a proportionally generous amount of $4.55/hour for the library job. That’s $77.35 a week given a tax rate of 15%, and after 40 school weeks of 20 hours a week of library work, the student could have made a total of $3094. The student could have covered 88% of the annual  private 4-year college bill or 28% of the Harvard bill.

The proportion of college tuition, room and board that a student can pay by working is not what it used to be and it will only get worse at the current rate of tuition inflation. For this reason, I have personally never bothered taking on a work-study job to help with tuition bills. It’s mathematically impossible to make an real impact by doing so.

http://www.flickr.com/photos/foreversouls/ / CC BY-SA 2.0

John Prendergast John Prendergast is the co-founder and CEO of Blueleaf. He serves on the board of WiredTiger, a developer cloud optimized databases. He is also the founder and organizer of the Lean Startup Circle Boston. In addition to his decade and a half as an entrepreneur, John spent nearly a decade as an investment banker and financial advisor.
  • Avanti3258

    Who guaranteed anyone room, board or Harvard? Who ever said you must finish your degree in 4 years?  Many of us lived at home. Drove a scooter or beater. Took 7 years to get through school? A local school.