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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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4

MSI Investment and Returns on Investment

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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The Minority Serving Institutions (MSIs) described throughout this report have committed leaders, dedicated faculty, enthusiastic students, and proud alumni. But like all successful institutions of higher education, the more than 700 MSIs nationwide cannot operate on these strengths alone. Capital resources are critical to establish, support, and scale up the most effective programs and practices to promote the education, sociocultural development, and workforce training of MSI students. (See Chapter 5 for illustrative examples of the most effective programs and practices to promote MSI student success.) Throughout this chapter, we often refer to these resources as “investments” for a reason—adequately supporting MSIs is an investment, from which benefits accrue to the nation.

As described in Chapter 3, MSIs serve a large proportion of nontraditional and low-income students, many of whom self-finance their education and attend school part time while also working and supporting families. Given the profile of their student bodies, many MSIs are constrained by fewer sources of revenue (e.g., tuition and fees, private investments, and endowments) and rely on public funding more than non-MSIs (Nellum and Valle 2015; Nelson and Frye 2016). As part of the committee’s charge to review the challenges and obstacles facing MSIs as they execute their missions to prepare students for success, we explored the impact and outcomes of public investments that seek to support MSIs and student success.

This chapter provides an overview of public investments in MSIs, presents a side-by-side comparison of the multiple sources of revenue for MSIs versus non-MSIs, and describes select examples of returns on investment for MSI students, MSI communities, and the science, technology, engineering, and mathematics (STEM) workforce. The chapter concludes with a discussion on the need for new and expanded efforts to invest in MSIs to promote national progress in developing a larger and more diverse STEM-capable workforce.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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FEDERAL AND STATE INVESTMENT

Based on 2013 data, federal investment in higher education totaled $75.6 billion, or approximately 2 percent of the federal budget (Pew Charitable Trusts 2015).1 States collectively provided $72.7 billion, and localities provided $9.2 billion to higher education in 2013, primarily to support institutional operating expenses (Pew Charitable Trusts 2015). In the late 1980s, states provided the greatest amount of funding for postsecondary institutions but have steadily reduced this amount over time, especially during the recession that began in 2008 (Baum 2017; Pew Charitable Trusts 2015). This disinvestment has had serious implications for all institutions of higher education, including MSIs.

Beyond other forms of funding provided to the whole of higher education, MSIs receive targeted federal support by way of direct legislative appropriations. Federal funding to Historically Black Colleges and Universities (HBCUs) and Tribal Colleges and Universities (TCUs) is channeled through formula-based funding from the U.S. Department of Education under Title III of the Higher Education Act (HEA).2,3 Under formula-based funding, any institution that meets the federal definition of HBCU or TCU may receive a grant rather than go through a competitive process (Hegji 2017). Other institutions, including enrollment-defined MSIs, are eligible for application-based, competitive grant programs from the U.S. Department of Education, many of which are authorized under the amended HEA of 1965.4 Federal agencies with STEM activities provide additional, targeted funding to MSIs, with an emphasis on institutional capacity building.

U.S. Department of Education

Approximately one-half of the U.S. Department of Education’s budget is allotted for investments in higher education (Pew Charitable Trusts 2015). A major source of Department of Education funding for MSIs comes through capacity-building grants under Title III and Title V of the HEA. In 2016, MSI programs

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1 Portion of the total federal budget of $3.5 trillion. Calculation is from across all agencies and for all types of institutions, including institutional grants and contracts but excluding student loan programs.

2 Unlike the enrollment-based MSIs in Title III, HBCUs are not required to meet the low educational and general expenditures nor the specified threshold of needy students to be eligible to receive funding. For additional information, see http://congressionalresearch.com/RL31647/document.php?study=Title+III+and+Title+V+of+the+Higher+Education+Act+Background+and+Reauthorization +Issues. Accessed October 2018.

3 Predominantly Black Institutions (PBIs) are unique in that federal funding under Title III, Part A is formula-based funding, similar to that of TCUs and HBCUs. PBIs are also eligible for competitive grant funding under Title III, Part F.

4 Higher Education Act of 1965, Pub. L. No. 89-329 (1965). As of the drafting of this report, Congress was considering the Promoting Real Opportunity, Success and Prosperity through Education Reform (PROSPER) Act. If passed as submitted, this bill would substantially modify the Higher Education Act and negatively impact funding designated for MSIs.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×

were appropriated approximately $817 million to help fund more than 900 grants to institutions (Hegji 2017). The grants seek to improve and strengthen institutions’ academic quality and provide expanded educational opportunities for low-income students through a specified list of allowable activities that include faculty development, facility construction, and academic programs. As summarized by Espinosa, Turk, and Taylor (2017), funding streams are intended as follows:

  • Title III, Part A—Strengthening Institutions Program. Helps eligible institutions to expand their capacity to serve low-income students by “providing funds to improve and strengthen the academic quality, institutional management, and fiscal stability of eligible institutions.” MSIs that receive funding through Title III, Part A include all MSI types except HBCUs and Hispanic-Serving Institutions (HSIs).5
  • Title III, Part B—Strengthening Historically Black Colleges and Universities Program. Focuses on HBCUs and “provides financial assistance to Historically Black Colleges and Universities to establish or strengthen their physical plants, financial management, academic resources, and endowment-building capacity.”6
  • Title III, Part F—Hispanic-Serving Institutions – Science, Technology, Engineering, or Mathematics and Articulation Programs. Aims to increase the number of Hispanic and low-income graduates in STEM fields and to build the quality and quantity of model transfer and articulation agreement programs between two-year HSIs and four-year institutions in STEM fields.7
  • Title V, Part A—Developing Hispanic-Serving Institutions Program. Provides funding to HSIs “to expand educational opportunities for, and improve the attainment of, Hispanic students. These grants also enable HSIs to expand and enhance their academic offerings, program quality, and institutional stability.”8

To receive Title III or V funding, in addition to meeting predetermined enrollment thresholds (and for Predominantly Black Institutions, size and income thresholds), institutions also must have low educational and general expenditures; that is, in order to receive support, they must demonstrate that they have fewer

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5 For more information, see U.S. Department of Education, https://www2.ed.gov/programs/iduestitle3a/legislation.html, accessed October 2018, and Cornell Law School, 20 U.S. Code § 1058: https://www.law.cornell.edu/uscode/text/20/1058#b_1, accessed October 2018.

6 For more information, see U.S. Department of Education, https://www2.ed.gov/programs/iduestitle3b/legislation.html, accessed October 2018.

7 For more information, see U.S. Department of Education, https://www2.ed.gov/programs/hsistem/legislation.html, accessed October 2018.

8 For more information, see U.S. Department of Education, https://www2.ed.gov/programs/idueshsi/legislation.html, accessed October 2018.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×

resources with which to serve their students.9 The definition of “low expenditures” is set by the U.S Department of Education annually and is not made publicly available from year to year, although some waivers to these thresholds are accepted,10 which may impact long-term budgetary projections. In addition, regardless of need, institutions cannot apply for funding under more than one MSI type, even if they qualify as such. For example, if an institution meets the criteria for both an HSI and an HBCU (as does St. Phillips College in San Antonio, Texas), or both an HSI and an Asian American and Native American Pacific Islander Serving Institution (AANAPISI) (as do several institutions in California), it must choose one or the other when applying for federal funding.

While these federal grant programs (with the exception of Title III, Part F) are not specific to STEM, the Title III and V grant programs can be, and are, utilized by MSIs to strengthen their STEM infrastructure and provide specialized programming for STEM students that facilitate retention and graduation in these disciplines. In 2018, the federal omnibus spending bill provided increased support for these programs.11 The U.S. Department of Education’s fiscal year (FY) 2018 budget appropriated $681 million for Title III programs, including those listed above, and $227 million for aid for Hispanic-Serving Institutions.12 Both programs received a 14 percent increase in discretionary funding, and resulted in an estimated $82 million of new funds for FY 2018. At the time of this report, however, the 2019 White House Administration’s budget request proposed a 25 percent decrease in aid for Title III programs and a 56 percent decrease in Aid for Hispanic-Serving Institutions, compared to 2018 appropriations.13

STEM-Focused Investments by Other Federal Agencies

Other federal agencies have established funding streams that specifically support STEM programming and capacity at institutions of higher education, including but not limited to MSIs. The top six sources are the Department of Health and Human Services (DHHS; including the National Institutes of Health), which provides the largest amount, followed by the National Science Foundation, Department of Defense (DoD), Department of Agriculture, Department of Energy, and the National Aeronautics and Space Administration. The total amount awarded across these agencies (including much smaller amounts in about a dozen

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9 For more information, see Cornell Law School, reprinted 20 U.S. Code § 1068, https://www.law.cornell.edu/uscode/text/20/1058#b_1, accessed October 2018.

10 For more information, see Cornell Law School, reprinted 20 U.S. Code § 1068a, https://www.law.cornell.edu/uscode/text/20/1068a#b, accessed October 2018.

11 The Consolidated Appropriations Act, 2018 (Pub. L. No. 115-141) was enacted by the 115th United States Congress and signed into law by President Donald Trump on March 23, 2018.

12 U.S. Department of Education, https://www2.ed.gov/about/overview/budget/budget18/18action.pdf.

13 U.S. Department of Education, https://www2.ed.gov/about/overview/budget/budget19/19action.pdf.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×

others) for science and engineering activities, including research, education, and infrastructure support, in 2015 was $30.5 billion. Of this total, HBCUs, HSIs, and TCUs (AANAPISIs and other MSI types were not separated out) received $783 million. More than one-half that amount ($539 million) went to only 20 out of the more than 700 MSIs (NSF 2017a). The funding principally supports research and development (R&D), but some programs support fellowships, facilities, and other activities.14Box 4-1 provides a few of many examples. Although greater investment is needed, understanding which of these publicly funded programs most effectively serves the national goal of preparing young Americans, including young people of color, to pursue and acquire high-quality STEM degrees, also remains a compelling need.

OVERVIEW OF INVESTMENTS BY MSI TYPE

Another prism through which to look at investment support is by type of MSI. This lens illustrates how decreased or inconsistent public funding can hamper institutions, and how actual funding allocations often do not align with the amounts that Congress has authorized.

HBCUs

As is the case for other MSIs, the stability of HBCUs depends on allocations of public investments (Gasman 2010). Although HBCUs are funded through a variety of revenue sources, federal, state, and local allocations provide most of their funding. As shown in Figure 4-1, public four-year HBCUs rely more heavily on federal, state, and local appropriations, grants, and contracts as a source of total revenue than do public four-year non-HBCUs (54 versus 38 percent, respectively). Private four-year HBCUs rely more on net tuition revenue as a source of total revenue than do private four-year non-HBCUs (45 percent versus 37 percent, respectively). Private gifts, grants, and contracts represent a lower proportion of total revenue at HBCUs than at non-HBCUs.

Although federal funding to HBCUs has increased over the past decade, it is not sufficient to meet institutional need (Gasman 2010). Looking across federal agencies during fiscal year 2013 (Table 4-1), HBCUs receive 3 percent or less of each agency’s total investment in institutions of higher education, except in the Department of Agriculture. Two important points can be garnered from this table. First, these funds ($172 million), although seemingly substantial, are shared across roughly 100 different HBCUs and are unevenly distributed to only a small subset (Gasman 2010). This suggests that recent allotments of federal investments are not sufficient to meet the needs of the majority of HBCUs. Second, Table 4-1

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14 See Chapter 5’s section on Public-Private Partnerships for additional discussion on MSI-focused STEM investments.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×
Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×
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FIGURE 4-1 Percentage of investments by source, public and private (nonprofit) four-year HBCUs and non-HBCUs.
NOTE: Private gifts, grants, and contracts include investment income such as interest on endowments. Percentages were rounded to the nearest whole number (based on source data).
SOURCE: Williams and Davis (2018). ©2018 American Council on Education. Adapted and reprinted with permission.

TABLE 4-1 Federal Investments in Institutions of Higher Education (IHE) and the Percentage of IHE funds Awarded to HBCUs, by Federal Agency, 2013

Federal Agency IHE HBCU Percent HBCU Share
TOTAL Investment $172,369,578,639 $4,758,941,493 2.8
Department of Education $139,649,172,390 $4,225,388,454 3.0
Department of Health and Human Services $17,163,165,640 $156,400,000 0.9
Department of Agriculture $1,213,525,235 $145,508,729 12.0
National Science Foundation $5,116,335,618 $92,128,863 1.8
Department of Defense $3,619,871,702 $25,681,122 0.7
National Aeronautics and Space Administration $889,110,653 $23,379,116 2.6
Department of Energy $1,241,285,216 $19,478,488 1.6

NOTE: Table is incomplete. The top six agencies, in terms of IHE investments, are included. Additional agencies provided smaller investments to reach the total investment in the first row.

SOURCE: Adapted from U.S. Department of Education (2015, page 5).

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×

demonstrates that the Department of Health and Human Services (DHHS) and the Department of Defense (DoD) contribute a markedly lower investment in HBCUs compared to other institutions of higher education. These findings shed light on opportunities for HBCUs to explore new, underutilized revenue streams, and for DHHS and DoD to consider new partnership opportunities with HBCUs. Of note, at the time of this report, the White House submitted an overall budget request of $686 billion for DoD ($108 billion more than its authorized budget in FY 2013).15 This substantial increase in funding suggests HBCUs, particularly the most resource challenged, may find additional investment opportunities in DoD R&D grants and contracts. (See also Chapter 5’s discussion on partnerships with government agencies and the committee’s recommendations to Congress on expanding federal investments in MSIs.)

In addition to federal funding disparities, the United States has a long history of inequities in state-level support for HBCUs (Gasman 2007). Minor (2008) used North Carolina as a recent case in point: in 2007 the University of North Carolina at Chapel Hill and North Carolina State University (both Predominantly White Institutions, PWIs) received approximately $15,700 in state funding per-student, as compared to the approximately $7,800 per student state investment in North Carolina A&T and Fayetteville State University (both HBCUs). The author urged state higher education leaders to be more cognizant of irregular state funding patterns and their potential to worsen inequities in public education.

In addition to fighting for equitable state support, HBCUs are challenged with ensuring that their unique institutional programming and/or educational ventures are not being duplicated at nearby Predominantly White Institutions (Pluviose 2006). Issues with program duplication are said to create unnecessary competition between state institutions and threaten the visibility and potential profitability of HBCUs (Palmer and Griffin 2009; Pluviose 2006). At least one such state case has advanced to the federal court system (Box 4-2).

TCUs

TCUs rely on federal funding as their main source of revenue to a greater extent than other types of MSIs, with greater than 70 percent of revenues coming from federal appropriations (Figure 4-2; see also Nelson and Frye, 2016). Because of the relationship between Native American tribes and the federal government, states are not required to provide funding to TCUs, and many do not. The Tribally Controlled College or University Assistance Act of 1978 (TCCUAA) contains several titles that provide funding to TCUs, although different TCUs have different authorizations and, thus, different types of federal funding (Nelson

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15 For more information on the proposed budget for the Department of Defense, see https://dod.defense.gov/News/SpecialReports/Budget2019.aspx, accessed October 2018.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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and Frye 2016).16 The Bureau of Indian Affairs, within the U.S. Department of the Interior, manages and distributes these funding streams (AIHEC 1999).

TCU federal funding, although tightly regulated, is not without its challenges. Research has suggested that TCU funds are not being appropriated to full TCCUAA-authorization levels (Figure 4-3; see also Nelson and Frye (2016) for additional discussion). Additionally, the mathematical formula used to determine federal funding only allocates funds for Native students (Nelson and Frye 2016).

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16 For the language of the Act, see 25 U.S.C. Ch. 20: Tribally Controlled Colleges and Universities Assistance, http://uscode.house.gov/view.xhtml?path=/prelim@title25/chapter20&edition=prelim, accessed October 2018.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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FIGURE 4-2 Percentage of investments by source at TCUs and public non-TCUs.
NOTE: Percentages below 3 percent were not labeled.
SOURCE: Adapted from Nelson and Frye (2016).
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FIGURE 4-3 Federal appropriations per Native student at TCUs, authorized versus allocated.
SOURCE: Adapted from Nelson and Frye (2016); data from Integrated Postsecondary Education Data System.
Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×

This is an important concern because, on average, 16 percent of the student population at TCUs is non-Native (Nelson and Frye 2016). This lack of coverage for non-Native students puts additional pressure on TCUs’ budgets to fill the revenue gap and support the full student body.

Like most public higher education institutions, TCUs historically have not and currently do not derive a substantial amount of their revenue from private gifts or endowments. Furthermore, as with other MSIs, TCUs are constrained in their ability to raise tuition because of the specific profile of their student population. The majority of students served by TCUs face significant economic barriers such as extremely high rates of poverty and unemployment. More than 75 percent of students attending TCUs are Pell grant recipients, and few participate in the federal student loan programs (AIHEC 2012). (See Chapter 3 for additional discussion on TCU students.)

HSIs

Similar to HBCUs, HSIs are funded through a variety of revenue sources, mostly from federal, state, and local allocations (Figure 4-4). At two-year HSIs, greater than 70 percent of the total external support comes from federal, state, and local sources compared to about 57 percent at non-HSIs. Looking at 4-year institutions, the difference is smaller—46.7 percent for HSIs compared to 42.0 percent for non-HSIs. These data indicate that changes in public budgets would greatly affect HSIs’ capacity to prosper, especially for two-year institutions.

With the reauthorization of the Higher Education Act’s Title V, Part A in 1998, the federal government increased its commitment to support student success at HSIs. However, since then, the demographics of the United States have changed, and correspondingly, so have the demographics of higher education (Hale 2004; Pew Research Center 2014; U.S. Census Bureau 2017). Not only has there been a dramatic increase in the number of Hispanic students enrolled at all institutions of higher education, but also the total number of HSIs and emerging HSIs have increased as well.17The growth in the number of Hispanic students and the number of HSIs now challenge the ability of federal appropriations, established 20 years ago, to remain aligned with a rapidly growing need. As potential evidence of this impact, Figure 4-5 demonstrates that per-student state and local investments in two- and four-year HSIs have dropped significantly since 2008. In light of this evidence, there is an urgent need to reexamine

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17 In 2000, there were 229 federally eligible HSIs, and by 2016 there were 492 (Excelencia in Education 2018; HACU 2018). Using data from 2016 to 2017, Excelencia in Education has identified 333 colleges and universities with between 15 and 24.99 percent Hispanic enrollment that may soon become HSIs, due to their increasing enrollments of Hispanics—calling them “Emerging HSIs” (Santiago and Andrade 2010).

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×
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FIGURE 4-4 Percentage of investments by source at public two- and four-year HSIs and non-HSIs.
NOTE: Percentages below 3 percent were not labeled.
SOURCE: Adapted from Nellum and Valle (2015).

and readjust current funding methods to better support these institutions and their students.

AANAPISIs

AANAPISIs are a relatively recent, but growing sector within the MSI landscape. There are approximately 133 two- and four-year institutions that, based on enrollment and income, are eligible to receive AANAPISI-designated funding (Museus et al. 2018); however, in FY 2016, only 25 AANAPISIs received funding through the U.S. Department of Education, for a total of about $8,044,000 (U.S. Department of Education 2018). Many more could be eligible for Title III funding but are not taking the steps to access it, in particular two-year institutions (CARE 2013). In addition, similar to HSIs, a large number of AANAPISIs are two-year institutions and are ineligible for many of the federal R&D programs that serve four-year research institutions. Overall, AANAPISIs rely more on state and local appropriations and less on federal funding than non-AANAPISIs (48.9 percent) (Figure 4-6).

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×
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FIGURE 4-5 Per-student investments in public two- and four-year HSIs and non-HSIs, 1999-2012.
SOURCE: Adapted from Nellum and Valle (2015); data from National Forum on Higher Education for the Public Good analysis of Delta Cost Project Database, 1999-2012.

SUMMING IT UP: WHY PUBLIC INVESTMENTS IN MSIS MATTER

As described in the sections above, MSIs are supported by multiple sources of revenue, including federal, state, and local appropriations; tuition and fees; and, to a lesser extent, endowments and private investments. Given their complex needs, these institutions face substantial resource challenges. Here we highlight two aspects of these challenges: (1) the disparities in how much is invested in MSIs versus non-MSIs, and, as a result, how much MSIs can invest back into

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×
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FIGURE 4-6 Percentage of investments by source, AANAPISI and non-AANAPISI public institutions, 2011.
NOTE: See the Annex at the end of this chapter for notes.
SOURCE: Adapted from CARE (2013). National Center for Education Statistics (NCES) and Integrated Postsecondary Education Data System (IPEDS) data.

their institutions versus non-MSIs, and (2) the disparities in endowment assets between MSIs and non-MSIs.

Comparison of Revenue Sources and Allocations for Two- and Four-Year MSIs and Non-MSIs

Four-year MSIs receive less revenue per full-time-equivalent (FTE) student than do four-year non-MSIs; moreover, two-year institutions, both MSIs and non-MSIs, receive far less revenue per FTE student than do four-year institutions (Table 4-2). And expectedly, MSIs in general spend less per FTE student than non-MSIs, whether for instruction, academic and social supports, or other aspects that contribute to student success (Table 4-3). The notable disparities in total revenue show that MSIs are working with fewer resources than are non-MSIs, despite enrolling a high percentage of nontraditional and low-income students. Moreover, MSIs have fewer options to raise tuition and fees to offset expenses.

This context challenges MSIs to provide sufficient resources to ensure that they are equipped to meet the standards and expectations for high-quality edu-

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×

TABLE 4-2 Investments in MSIs and Non-MSIs per Full-Time-Equivalent (FTE) Student

FOUR-YEAR INSTITUTIONS
Non-MSI (means) MSI (means) Difference in Funding for MSIs
Total revenue (including tuition, excluding auxiliaries and other) per FTE studenta $29,833 $16,648 –$13,185
State and local appropriations per FTE student $4,989 $5,446 +$457
State and local grants and contracts $1,896 $1,107 –$789
Federal appropriations, grants, and contracts per FTE student (net Pell)b $4,971 $2,249 –$2,722
Private gifts and investment return $6,586 $863 –$5,723
TWO-YEAR INSTITUTIONS
Non-MSI (means) MSI (means) Difference in Funding for MSIs
Total revenue (including tuition, excluding auxiliaries and other) per FTE studenta $10,341 $10,192 –$149
State and local appropriations per FTE student $5,077 $6,142 +$1,065
State and local grants and contracts $747 $732 negligible
Federal appropriations, grants, and contracts per FTE student (net Pell)b $802 $899 negligible
Private gifts and investment return $154 $171 negligible

NOTE: See the Annex at the end of this chapter for notes.

SOURCE: Adapted from Cunningham et al. (2014).

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×

TABLE 4-3 MSI and Non-MSI Spending per Full-Time-Equivalent (FTE) Student

FOUR-YEAR INSTITUTIONS
Non-MSI (means) MSI (means) Difference in MSI Spending
Total educational and general expendituresa per FTE student $28,806 $16,743 –$12,063
Student services, academic support, and institutional support per FTE student $8,399 $5,750 –$2,649
Research and public service per FTE student $6,202 $1,638 –$4,564
Operations and maintenance per FTE student $2,024 $1,482 –$542
Scholarships and fellowships per FTE student $959 $1,599 +$640
TWO-YEAR INSTITUTIONS
Non-MSI (means) MSI (means) Difference in MSI Spending
Total educational and general expendituresa per FTE student $10,667 $10,592 negligible
Student services, academic support, and institutional support per FTE student $3,528 $3,629 +$101
Research and public service per FTE student $210 $153 negligible
Operations and maintenance per FTE student $960 $963 negligible
Scholarships and fellowships per FTE student $1,323 $1,696 negligible

NOTE: See the Annex at the end of this chapter for notes.

SOURCE: Adapted from Cunningham et al. (2014).

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×

cation (particularly STEM education), sociocultural development, and relevant research and training experiences for the students. Research has further shown that institutional expenditures have an impact on graduation rates. For example, Webber and Ehrenberg (2010) developed a model to examine the overall effect of four categories of institutional expenditures (instructional, academic support, student service, and research) on graduation rates at HBCUs. The researchers found that higher spending, especially related to instruction and student services, positively influences student outcomes related to persistence and graduation and that institutions with lower numbers of Pell recipients (i.e., wealthier institutions) spend more per student FTE in these categories.

Comparison of Endowment Assets between Four-Year MSIs and Non-MSIs

In addition to federal and state resources, many institutions maintain endowment funds, defined by the American Council on Education (ACE 2014) as an “aggregation of assets invested by a college or university to support its educational mission in perpetuity.” Endowments can provide institutional stability; serve as a source for student financial aid; leverage other sources of revenue; encourage innovation, flexibility, and risk taking; and allow for a longer-term time horizon for improvements to be realized. Much media attention has been given to Ivy League and other institutions with very large endowments, often with the assumption that all institutions of higher education have this resource. However, this is not the case for most public and even many private institutions.

In examining median and mean endowment assets per FTE18 for four-year MSIs, the data show that MSIs have far lower endowments than non-MSIs.19 For example, as shown in Table 4-4, the median endowments per FTE in 2015 for four-year public AANAPISIs and especially HBCUs and HSIs were markedly low, as compared to the median endowment per FTE for public four-year non-MSIs. The mean values further unmask the funding extremes between non-MSIs and MSIs. The mean endowment per FTE for public four-year non-MSIs is $16,709, more than twice the mean values per FTE at HBCUs, AANAPISIs, and HSIs. Even the highest endowed MSI would be viewed as poorly endowed when compared to a non-MSI.

Very few funding mechanisms exist to facilitate the creation or enhancement of endowment funds. The HEA presents a few funding opportunities that can be

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18 Calculation using IPEDS FY 2015 Finance survey; Examining median endowments per FTE show 50th percentile of endowments for each MSI type. In other words, it shows the median value of endowments for each institutional category, with half of institutions above that value and the other half below that value. Analysis by the American Council on Education.

19 Only select four-year MSIs are presented due to missing data and low sample sizes for other MSI categories. Non-MSI includes all institutions that were not designated as one of the seven MSI types in the College Scorecard for 2015-2016. College Scorecard was used to determine all institutions that were eligible to apply for federal MSI funding under Titles III and V.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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TABLE 4-4 Endowment Assets per Full-Time-Equivalent (FTE) Enrollment by MSI Type (Four-Year Institutions)

Non-MSI HBCU AANAPISI HSI
Public Private Public Private Public Private Public Private
Endowment Assets per FTE (Mean) $16,709 $79,934 $5,584 $25,855 $7,715 $24,884 $7,505 $11,691
Endowment Assets per FTE (Median) $6,707 $22,338 $3,744 $16,389 $5,636 $16,079 $3,844 $6,218
N 416 954 39 38 36 18 68 68

NOTE: See the Annex at the end of this chapter for notes.

SOURCE: IPEDS FY 2015 Finance Survey; Analysis by the American Council on Education for this report.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×

used to establish or increase institutional endowments. For example, the HEA’s Title III-C authorizes the Endowment Challenge Grant program. While not targeted specifically to MSIs, the funds are to be made available to most institutions of higher education with a high concentration of minority students.20

In principle, this grant program sounds like an ideal mechanism by which MSIs could realize long-term financial health. However, it has not been funded since fiscal year 1995 and there do not appear to be plans for its reestablishment. Furthermore, if the Endowment Challenge Grant program were active, it would require institutions, even the most financially challenged institutions, to provide nonfederal matching funds equal to the amount of the federal funds provided.21

HEA has a few other MSI-focused Title III and V program grants. While these programs can be used to establish or enhance an institution’s endowment fund, an institution may not use more than 20 percent of grant monies to do so. In addition, if an institution utilizes the program funds for endowment development, it must provide matching funds from nonfederal sources in an amount equal to or greater than the federal funds provided. The ability of MSIs (and indeed other institutions) to take advantage of such opportunities is limited and, in some cases, impossible, given other pressing, short-term financial priorities. (See Chapter 6 for the committee’s recommendation to Congress to support endowment-building programs.)

Public Investments Matter

Given MSIs’ historical inequities in funding and the clear projections for continued growth of this sector, there exists a critical need for the nation to reexamine current funding methods and explore new, innovative models of support.

As discussed in Chapters 2 and 3, as the nation’s demographic profile evolves, it is in the national interest to proportionally expand investments to the institutions where the majority of the diverse future workforce is being educated and trained—chiefly MSIs. As the number of MSIs continues to grow, public and private resources and attention must keep pace. (See Chapter 6 for the committee’s recommendation to funding agencies to reconsider current funding methods and to develop new and innovative funding models to better address the needs of MSIs and their students.)

RETURN ON INVESTMENT

A key concern for the committee was the extent to which it is possible to measure MSIs’ returns on investment (ROIs) for funders, students, local and regional communities, and the STEM workforce, and, where possible, make ROI comparisons with non-MSIs. Given the overall dearth of research on other

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20 For more information on the Endowment Challenge Grants, see Hegji (2017).

21 For more information on the Endowment Challenge Grants, see Hegji (2017).

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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aspects of MSIs, the committee was not surprised to find a deficit of economic research (e.g., cost-benefit analyses) on MSIs and their ROIs.

In traditional financial terms, ROI measures the gain or loss generated on an investment relative to the money invested.22 In recent years, attempts to employ ROI measurements have been made when analyzing the overall benefits of higher education to individuals and to society (Carnevale et al. 2015). Certain efforts focus on ROI by institution, others by major; not surprisingly, different methods of calculations result in different results.23 Additional studies have presented alternate measures of ROI, including noneconomic ROI for the student such as development of quality mentorships, improved self-esteem, leadership, community engagement, life satisfaction, and intellectual growth (Gallup-Perdue University 2015; Gasman et al. 2017; Nettles 2017; Pew Research Center 2011).

Clearly, measuring ROI when the “product” is a student, the institution itself, the surrounding community, or the nation is a complex endeavor. Certainly, students and families must consider costs and returns when deciding on postsecondary options—to say nothing of the choices for state and federal governments when weighing investments in colleges and universities versus, for example, investments in roads, K-12 education, and health care. But we would argue, and the research highlighted below supports the assertion, that a range of ROI indicators need to be taken into account when looking at institutions of higher education in general, and MSIs in particular, and that additional research is needed to measure and better understand the economic and social ROIs in higher education.

The committee examined the research on ROI in terms of the pathways toward education and work in STEM fields, upward mobility and earnings potential, and local and regional impact. It should again be noted that the dearth of overall research for all MSI types has necessitated a less-than-comprehensive look at this topic, despite the high level of interest in higher education ROI by a multitude of stakeholders (Gasman 2017).

Educating the Future Workforce

Given the need to widen pathways of access and opportunity to STEM and STEM-related careers, measuring the extent to which MSIs contribute to the number (and diversity) of STEM graduates prepared to enter the workforce represents one way to examine ROI. Many policy makers and other observers view

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22 Return on Investment. BusinessDictionary.com WebFinance, Inc., http://www.businessdictionary.com/definition/return-on-investment-ROI.html, accessed October 2018.

23 See, for example, Payscale 2018: College ROI Report, https://www.payscale.com/college-roi, and “10 College Majors with Best Starting Salaries,” September 25, 2017, U.S. News and World Report, https://www.usnews.com/education/best-colleges/slideshows/10-college-majors-with-the-highest-starting-salaries, accessed February 2018.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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the federal graduation rate (as derived from the U.S. Department of Education’s IPEDS) as an ROI in terms of student outcomes, with the implication that the higher the graduation rate of an institution, the better its ROI. However, if graduation rates are indeed to be considered a component of ROI, then it is important to more accurately reflect degree and credential completions among MSI students. As noted in Chapter 3, standard institutional metrics such as the federal graduation rate are not sufficiently defined and structured to consider the influence of important contextual factors (such as students’ financial circumstances, life stage, commitments to work and family, and academic preparation) and inadequately assess the success of MSIs and their students.

In an effort to look beyond the federal graduation rate, Espinosa, Turk, and Taylor (2017) examined MSI credential completion via another national data source: the National Student Clearinghouse (NSC). The NSC data offer a more complete picture of student enrollment and degree completion at MSIs than seen in IPEDS, in large part given its ability to track student enrollment patterns and movement beyond students’ starting institution, and over a longer period of time.24 As discussed in Chapter 3 (where the NSC analysis is presented), many MSI students attend college through mixed enrollment, meaning they move between part-time and full-time status. In addition, today’s MSI students are mobile and often attend more than one college; this is especially true for students seeking a bachelor’s degree who start at a community college.

The flexibility to attend part-time and over an extended period is one of the value-added experiences that many MSIs provide to students. That is, they are able to offer postsecondary education to those who, for various economic and family circumstances, cannot attend college as continuous, full-time students—including those who are returning to higher education many years after high school graduation. In short, MSIs face the challenge of addressing students’ complex sociocultural needs while still meeting the nation’s increased demand to educate a diverse citizenry, including those who will enter the STEM workforce as teachers, engineers, researchers, and in other capacities.

In addition to providing flexible completion pathways, MSIs are producing a substantial number of STEM-capable professionals, in part because of the educational, cultural, and environmental support factors described throughout this report. For example, taken together, HBCUs, HSIs, and AANAPISIs produced one-fifth of all STEM bachelor’s degrees in 2016. Moreover, their individual contributions to STEM degree completions (measured as a proportion of all completions) are on par with non-MSIs, and in the case of HBCUs and AANAPISIs, exceed non-MSIs in STEM degree production. See Figure 4-7.

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24 National Center for Education Statistics and Institute of Education Sciences (U.S.). 2016. Digest of education statistics. Washington, DC: U.S. Department of Education. Table 326.10. Graduation rate from first institution attended for first-time, full-time bachelor’s degree-seeking students at 4-year postsecondary institutions, by race/ethnicity, time to completion, sex, control of institution, and acceptance rate: Selected cohort entry years, 1996 through 2009. Available at: https://nces.ed.gov/programs/digest/d16/tables/dt16_326.10.asp, accessed October 2018.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×
Image
FIGURE 4-7 Total completions in STEM versus non-STEM fields, at MSIs compared to non-MSIs, 2016 data.
NOTE: There are limited IPEDS data for TCUs; hence, these data are not included. See the Annex at the end of this chapter for additional notes. See Appendix F, Table F-3 for the raw data used in calculations.
SOURCE: IPEDS 2016 Completions and Institutional Characteristics data. Analysis by the American Institutes for Research for this report.

When looking at individual racial and ethnic groups (see Figure 4-8), IPEDS 2016 completion data show that HBCUs awarded 15.6 percent of all STEM bachelor’s degrees earned by Black students, AANAPISIs awarded 18.8 percent of all STEM bachelor’s degrees earned by Asian American students, and HSIs awarded 40.5 percent of all STEM bachelor’s degrees earned by Hispanic students. Indeed, many MSIs are listed within the “top 20” rankings of institutions that graduate students of color in STEM disciplines.25

Based on 2011-2014 data, 10 HSIs and 10 HBCUs are among the top 20 institutions that award science and engineering degrees to Latinos and African Americans, respectively, and 18 AANAPISIs are among the top 20 institutions that award these degrees to Asian Americans (NSF 2017b).26 North Carolina A&T State University (a public HBCU) is the top source of African American graduates with engineering bachelor’s and master’s degrees in the country (Sharpe 2018), and Howard University, Xavier University of Louisiana, and Spelman College (private HBCUs) are the nation’s leading suppliers of African American students to U.S. medical schools (AAMC 2018a). The University of Puerto Rico Rio Piedras Campus, Florida International University, University of Puerto Rico Mayaguez Campus, and University of Texas Rio Grande Val-

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25 See https://www.nsf.gov/statistics/2017/nsf17310/static/data/tab5-12.pdf, accessed October 2018.

26 From the same dataset, 14 AANAPISIs were among the top 20 institutions that award science and engineering degrees to Pacific Islanders.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×
Image
FIGURE 4-8 Percentage total of STEM bachelor’s degrees earned by Black students at HBCUs compared to non-HBCUs, Asian American students at AANAPISIs compared to non-AANAPISIs, and Hispanic students at HSIs compared to non-HSIs, 2016 data.
NOTE: There are limited IPEDS data for TCUs; hence, these data are not included. See the Annex at the end of this chapter for additional notes. See Appendix F, Table F-4 for the raw data used in calculations.
SOURCE: IPEDS 2016 Completions and Institutional Characteristics data. Analysis by the American Institutes for Research for the current report.

ley (all HSIs) are among the top suppliers of Hispanic medical students to U.S. medical schools (AAMC 2018b). In short, the data suggest that MSIs contribute significantly to the STEM talent pool, and that with greater resources, support, and attention, it could be argued that the success of MSIs and their students would only increase.

There is sufficient evidence to suggest that MSIs are a valued resource for producing the next generation of students of color who are prepared to enroll in STEM graduate education. Because few MSIs are research-intensive, doctoral degree-granting institutions, it is not surprising that in total, MSIs award far fewer STEM doctorates than do non-MSIs. However, a significant number of the Hispanic and African American students who go on to STEM doctoral studies begin their postsecondary education at HSIs and HBCUs, according to 2011-2014 data compiled by the National Science Foundation (NSF 2017c).

For example, between 2011 and 2014, Howard University (a private HBCU) was the nation’s second leading producer of African American doctorate holders in science and engineering, and with 175 degrees awarded, was more than twice the University of Michigan-Ann Arbor (a PWI), which produced 82 African American doctorates. Clark-Atlanta University and Jackson State University

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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(both public HBCUs) ranked 14th and 18th among the 20 leading producers of doctorates for African Americans in this same period. In terms of HSIs, Pontifical Catholic University in Puerto Rico ranked third in awarding doctorates to Hispanics in science and engineering, with the University of Puerto Rico, University of Texas-El Paso, Florida International University, and University of California-Irvine also within the top 20 in this same time period (NSF 2017c).

Other research shows that between 2008 and 2012, of the top 50 baccalaureate-origin institutions that produce Hispanic STEM doctorate recipients, nearly one-third (16) were HSIs.27 Similarly, among the top 40 baccalaureate-origin institutions that produce Hispanic doctorate recipients in engineering, nine were HSIs.27 Eight of the top 10 baccalaureate-origin institutions that produce African American science and engineering doctoral recipients are HBCUs (Richards and Awokoya 2012), and HBCUs, throughout history, have been a significant source of African American students who go on to earn STEM doctoral degrees (Burrelli and Rapoport 2008; Sibulkin and Butler 2011; Solórzano 1995). This is a particularly salient finding, given that there are far greater numbers of undergraduate students of color enrolled at non-MSIs (see Appendix F, Figure F-1).

These examples support the rationale that MSIs are a significant national resource for producing talent to fulfill the needs of the nation’s current and future STEM workforce. Moreover, many are in a position to produce more graduates at all levels.

Income Mobility and Earnings Potential

Most students expect that their college degrees will result in earnings higher than those they would make if they did not earn a degree. While the research confirms this value proposition, especially for STEM graduates (Carnevale et al. 2015), a growing body of literature shows that students who matriculated at MSIs do as well as or better than those who attended non-MSIs when it comes to individual income mobility (Chetty et al. 2017).

Newly available data from the Equality of Opportunity Project—a joint research endeavor of researchers at Stanford, Brown, and Harvard Universities28—shed important light on the value of MSIs (and indeed all of higher education) in terms of their role in income mobility for low-income Americans. The researchers define mobility, calculated via a “mobility rate,” as a product of a given institution’s access for low-income students, or “the fraction of its students who come from families in the bottom quintile,” and an institution’s success rate, or “the fraction of students in the bottom income quintile who reach the top quintile” (emphasis in original, Chetty et al. 2017, p. 23).

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27 For more detailed information, see HSI STEM Degree Production. (n.d.) Hispanic Association of Colleges & Universities, https://www.hacu.net/hacu/HSIs_and_STEM.asp, accessed February 2018.

28 See www.equality-of-opportunity.org, accessed October 2018.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×

Espinosa, Kelchen, and Taylor (2018) examined the mobility rate of HBCUs, HSIs, AANAPISIs, and PBIs29,30 compared to non-MSIs using Equality of Opportunity Project data. The findings show that across MSI types by higher education sector (i.e., two- and four-year institutions), MSIs do as well as or better than non-MSIs in moving students from the lowest income quintile to the highest income quintile by age 30. The authors found this mobility also holds true when taking into account students who start in the bottom two income quintiles and move to the fourth or fifth income quintiles as adults. As these findings suggest, MSIs contribute to the upward income mobility of the students they enroll, reinforcing the ROI proposition of MSIs within their communities and for the nation.

As shown in Table 4-5, MSIs have similar or higher mobility rates than those of non-MSIs. For example, the mobility rate of all four-year MSI types is nearly double (and in some cases triple) that of non-MSIs. In particular, HSIs’ mobility rate is 4.3 percent, meaning they move three times as many students from the lowest income quintile to the highest quintile than non-MSIs at 1.5 percent. When looking at the extended mobility rate,31 which takes into account students who start in the bottom two income quintiles and end up in the top two income quintiles as adults, MSIs continue to have higher mobility rates than those of non-MSIs. As with four-year MSIs, two-year MSIs also have higher mobility and extended mobility rates than those of non-MSIs. As such, it is important to note that MSIs contribute to the upward income mobility of their students while operating with fewer financial resources than non-MSIs.

Federal MSI designation and grant funding require enrollment-based MSIs to have low educational and general expenditures (as noted above and in Chapter 3). To examine differences among four-year enrollment-based MSIs32 and non-MSIs with low resources, the mobility study includes a restricted sample of four-year institutions with expenditures per FTE of $25,000 or less. As shown in Table 4-5,

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29 This study analyzes data from the Equality of Opportunity Project to focus on a cohort of students who were born between 1983 and 1985, and who began college in approximately the 2002-2003 academic year. The authors used IPEDS 2002-2003 institutional characteristics data to identify HBCUs and fall enrollment data to identify institutions as HSIs, AANAPISIs, and PBIs if they met the respective student enrollment thresholds in that academic year.

30 The mobility rate is calculated as the product of admitting a student whose parents are from the bottom 20 percent of the income distribution (bottom income quintile) for all college students’ parents and having the student earn in the top 20 percent (top income quintile) for all students who entered college that same year. If a college admitted 20 percent of its students from the bottom 20 percent of the income distribution, and 20 percent of those students went on to earn in the top income quintile (top 20 percent), the college mobility rate would be 4 percent (20 percent multiplied by 20 percent equals 4 percent).

31 An extended mobility rate is the product of the percentage of students who come from families in the bottom 40 percent (two bottom income quintiles) and end up in the top 40 percent (top two income quintiles) as adults.

32 As previously mentioned, HBCUs are among MSIs that were recognized with the mission to serve a specific demographic group, namely, African American students. Therefore, HBCUs are not required by the federal government to have low educational and general expenditures for federal designation or participation in federal grant programs. As a result, HBCUs were not included in the analysis of this restricted sample.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×

TABLE 4-5 Student Mobility Rates, by MSI Type and Sector

Non-MSI HSI AANAPISI PBI HBCU
Four-Year Institutions
Mobility Rate 1.5 4.3 3.3 3.5 2.8
Extended Mobility Rate 9.4 20.8 12.1 20.8 19.3
N 948 47 112 11 69
Four-Year Institutions with Low Expenditures
($25,000 per Full-Time Equivalent (enrollment) Student or Less)
Mobility Rate 1.5 4.4 4.1 3.5 NAa
Extended Mobility Rate 9.9 21.5 16.4 20.8 NAa
N 714 39 44 11 NAa
Two-Year Institutions
Mobility Rate 1.5 3.2 2.4 1.8 2
Extended Mobility Rate 10.9 17.2 13.4 13.2 13.3
N 604 53 44 40 6

NOTE: See the Annex at the end of this chapter for notes.

SOURCE: Adapted from Espinosa et al. (2018).

even among the lowest-resourced institutions, MSIs still have higher mobility rates than those of non-MSIs.

Analyses by other researchers look at economic mobility and success of MSI students, although not all findings show a clear or always positive picture of mobility by MSI graduates. For example, a comparison of a cohort of students in Texas shows no difference in mobility, as defined above, 10 years out, between Hispanic graduates from comparable HSIs and non-HSIs (Park et al. 2018).33 In this case, however, it is the lack of differential outcomes that the authors deemed noteworthy: “This finding is important, as HSIs are often criticized for having lower graduation rates and, by extension, lower returns on investment for those attending these institutions…” (Park et al. 2018, p. 47). According to research by Chetty et al. (2017), of the top 10 colleges and universities most successful at promoting upward intergenerational mobility, half are HSIs: California State University—Los Angeles (first), University of Texas, Pan American (fifth), Glendale Community College (seventh), South Texas College (eighth), and the University of Texas, El Paso (tenth). The schools that succeed in intergenerational mobility graduate a larger share of students in science and engineering majors,

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33 This study analyzed data from restricted-use administrative records from the Texas Education Agency, the Texas Higher Education Coordinating Board, and the Texas Workforce Commission.
Source: University of Texas Rio Grande Valley. History of The University of Texas Rio Grande Valley, http://www.utrgv.edu/en-us/about-utrgv/history/index.htm, accessed July 2018.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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not surprising given the salary premium placed on STEM jobs in today’s workforce (Chetty et al. 2017).

In addition, research on African American graduates of HBCUs versus comparable non-HBCUs shows occupational status and earnings differences, concluding that labor market outcomes are greater for African American graduates from HBCUs (Price et al. 2011; Strayhorn 2015). The economic success of HBCU graduates was also reviewed in a 2017 United Negro College Fund (UNCF) report that analyzed the economic impact of these institutions. Using 2014 data, the researchers determined that the 50,000-plus HBCU graduates will have an estimated $130 billion in total lifetime earnings—56 percent more than they would earn without a college credential (UNCF 2017).34,35 In sum, increased investments to help bolster the success of MSIs holds great promise for advancing the income mobility of millions of citizens of color.

The Local and Regional Impact of MSIs

Many MSIs have as a stated or implicit part of their mission to strengthen the local and regional communities in which they are located. From a historical perspective, as described in Chapter 3, HBCUs, TCUs, and some HSIs were established with the express purpose of educating students who had little or no access to mainstream higher education. The goal was to provide postsecondary access to individuals and strengthen communities and/or tribal nations through increased educational access and attainment. The 2017 UNCF report discussed above provides an example of how investments in HBCUs and their students generate a “ripple effect” that induces a positive impact on the schools’ local and regional communities. Based on 2014 data, HBCUs helped generate more than 134,000 jobs (both on and off campus) for their local and regional economies, and ultimately provided $14.8 billion in total local and regional economic impact.36 From these findings, the researchers concluded that “HBCUs are economic engines in their communities, generating substantial economic returns year after year” (UNCF 2017, p. 4).

When considering local and regional impact, it is important to remember that some MSIs operate within unique contexts, namely TCUs. These institutions fulfill a dual mission: educating students and addressing Native American tribal priorities, such as contributing to not only the economic growth of the reservation, but also community development, and social renewal (Stull et al. 2015). TCUs’

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34 The data sources used in this report include the data from the 2013-2014 IPEDS survey, and surveys conducted by the U.S. Bureau of Labor Statistics and The College Board. For more information on the methodology used in this report, see https://secure.uncf.org/page/-/pdfs/HBCU_TechnicalReport_517L.pdf?_ga=2.243899520.461513395.1539098147-851689931.1537544139, accessed October 2018.

35 The $130 billion estimate reflects incremental earnings averaged across degree and certificate programs.

36 This estimate includes direct spending by HBCUs, as well as the indirect effects of that spending.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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impacts explicitly include social and economic benefits beyond the benefits to students and faculty, to encompass collective interests of the surrounding community and tribal nations (Cunningham 2000; EMSI 2015). Most TCUs offer academic programming that has a direct connection to local workforce needs.37 Such efforts increase students’ applicable skill sets, boost their earning potential, and provide incentives for graduates to remain in the community (EMSI 2015; Rainie and Stull 2016). TCUs also offer academic courses that teach vocational skills to improve tribal infrastructure, health courses to improve community well-being, and cultural courses to help maintain long-standing tribal traditions (Rainie and Stull 2016). As a result, TCUs are able to provide economic and noneconomic ROI for their students, tribes, and local and national economies (EMSI 2015).

The same conclusions can be drawn when considering the impact of other MSIs on their local and regional communities, especially those located in places with few national industry partners. In these areas, local communities and local industries play an important role in providing career-related experiences to students. Service learning, community engagement projects, and senior-design projects at MSIs involve students in developing solutions to address challenges in the community. One such example is the UTRGV-Texas Manufacturing Assistance Center’s Lean Sigma Academy,38 where students work on projects from local industries and obtain an industry-recognized certification. Additionally, the UTRGV School of Medicine was created in an effort to teach and prepare medical students to provide health care to the Rio Grande Valley.39

Other university and local industry collaborations across the nation involve product design, improvement projects, and prototype design for local start-up companies. (See Chapter 5 for additional examples of MSI-industry partnerships.) More research needs to be done to measure the economic impact of these small-scale university-community partnerships. Indeed, additional evidence may incentivize mayors, governors, and other local and state leaders to evaluate the extent to which larger investments in MSIs can yield economic benefits for communities that extend far beyond the benefits to individual students, faculty, and institutions. (See Chapter 6 for the committee’s recommendations to funding agencies to support additional research on this issue.)

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37 This may result in TCUs with academic curricula that are less STEM focused, depending on the local and regional needs.

38 For additional information, see https://www.utrgv.edu/tmac/services/more-services/index.htm, accessed October 2018.

39 UTRGV School of Medicine, see http://www.utrgv.edu/school-of-medicine/our-story/about-us/index.htm, accessed October 2018.

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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TARGETED INVESTMENTS IN MSIS AND THE POTENTIAL FOR INCREASED RETURN ON INVESTMENT

Despite receiving a fraction of the appropriated federal and state funding for higher education and experiencing deep cuts in public education spending, MSIs have shown success in providing ROI for students, the STEM workforce, regional and national economies, and the local communities that surround and support these institutions.

As described in Chapters 2 and 3 of this report, the country’s demographics will continue to reflect increases among non-Whites, and more MSIs will emerge. To keep pace, changes in current funding policies and methods are needed to ensure that MSIs have sufficient resources to meet high standards and expectations for educational quality (particularly STEM education), sociocultural development, and research and training, to support the future workforce. Greater resources per FTE would mean an increased capacity to support evidence-based programs and practices that promote and sustain the success of STEM students at MSIs, leading in turn to substantial increases in the ROIs discussed above. (Chapter 5 presents strategies that could productively benefit from increases in such intentional and targeted investments to cultivate a diverse, highly skilled, domestic STEM workforce.)

Although the evidence described in the preceding sections supports the argument for increased funding for MSIs and their students, the committee remains acutely aware that to effectively address the funding deficits and disparities at MSIs, a more dynamic evidence-based approach is needed. One challenge for the argument to create new or expand current funding mechanisms is the lack of clear understanding of how appropriated funding is having an intentional, targeted impact on the outcomes of students of color, particularly those in STEM disciplines (Boland 2018). Over the past few decades, billions of federal dollars have been allocated to MSIs to focus on improving STEM degree production; however, few studies can effectively demonstrate which of these funded programs best serve the national goal of increasing the number of students of color with high-quality STEM degrees, or increasing their presence in the STEM workforce.

The absence of rigorous evidence on availability, use, and effectiveness invites questions about the value of current investments. In light of this, the committee argues that it is in the best national interest not only to establish new and expand current STEM-focused investments for MSIs, but also to increase the intentionality, clarity, transparency, and accountability of these funds. More evaluation, and more nuanced evaluation, is sorely needed. Evaluations that are adequately funded to determine who is investing, where they are investing, and the measurable impact of these investments (e.g., student academic achievement, workforce readiness, local and regional prosperity, and strengthening the STEM workforce) are critical. (See Chapter 6 for the committee’s recommendations to stakeholders on how to address this need.)

Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×

CHAPTER ANNEX

Figure 4-7

  1. IPEDS data, collection year 2015, were used to create the list of institutions throughout this report for analysis run by the American Council on Education. Data in this report reflect Title IV participating, degree-granting, public and private, nonprofit, two-year and four-year institutions that offered undergraduate degrees. College Scorecard 2015-2016 data were used to flag institutions that were eligible to apply for federal MSI funding in that given fiscal year through Title III and Title V of the Higher Education Opportunity Act of 2008. Out of 3,129 total institutions, 714 were eligible for MSI designation. Of these institutions, 76 were eligible for more than one MSI designation.
  2. Total completions includes the following credentials: prebaccalaureate certificates, associate degrees, bachelor’s degrees, postbaccalaureate certificates, master’s degrees, and doctoral degrees.
  3. Classification of Instructional Programs (CIP) codes were placed into Science and Engineering categories based on the fields of study classification found in the NSF’s “Science and Engineering Degrees: 1966–2012,” appendix B, with additions made to cover CIP codes found in the IPEDS completions data that were not included in the NSF taxonomy. For completions, the racial category “other” is defined as the combination of “nonresident,” “race unknown,” and “two or more races.” Race reporting varies across years in the IPEDS, so information pertaining to Pacific Islanders is not available for all years and would be combined with counts for Asian American students.
  4. For the completions data, all CIP codes were converted to current CIP codes using available crosswalks, before applying the classifications based on the NSF taxonomy. The following CIP code conversion required for some IPEDS data files prior to 2004 was added to the crosswalk to convert 1990s to 2000s CIP codes: 8.0199, 8.0299, 8.0899, 8.1299 to 52.19. For the completions data, counts were collapsed across majornum 1 and 2. Completion degree type codes changed slightly in 2010 and later versions of the data, so slightly different groupings were used. For completions data prior to 2010: “3”=Associate, “5”=Bachelor, “7”=Master, “9”=Doctor, “10”=Doctor, “1”=Pre-BA Certificate, “2”=Pre-BA Certificate, “4”=Pre-BA Certificate, “6”=Post-BA Certificate, “8”=Post-BA Certificate, and “11”=Post-BA Certificate. For completions data from 2010 and later: “3”=Associate, “5”=Bachelor, “7”=Master, “17”=Doctor, “18”=Doctor, “19”=Doctor, “1”=Pre-BA Certificate, “2”=Pre-BA Certificate, “4”=Pre-BA Certificate, “6”=Post-BA Certificate, and “8”=Post-BA Certificate.
  5. For all but a few runs, data were not filtered using the First Look Report criteria. The First Look Report uses provisional IPEDS data and therefore totals may be slightly different from those reported in other federal reports, though these differences will be minor.

Figure 4-8

  1. IPEDS data, collection year 2015, were used to create the list of institutions throughout this report for analysis run by the American Council on Education. Data in this report reflect Title IV participating, degree-granting, public and private, nonprofit, two-year and four-year institutions that offered undergraduate degrees. College Scorecard 2015-2016 data were used to flag institutions that were eligible to apply for federal MSI funding in that given fiscal year through Title III and Title V of the Higher Education Opportunity Act of 2008. Out of 3,129 total institutions, 714 were eligible for MSI designation. Of these institutions, 76 were eligible for more than one MSI designation.
Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×
  1. Total completions includes the following credentials: prebaccalaureate certificates, associate degrees, bachelor’s degrees, postbaccalaureate certificates, master’s degrees, and doctoral degrees.
  2. Classification of CIP codes into Science and Engineering categories was based on the fields of study classification found in the NSF’s “Science and Engineering Degrees: 1966–2012,” appendix B, with additions made to cover CIP codes found in the IPEDS completions data that were not included in the NSF taxonomy. For completions, the racial category “other” is defined as the combination of “nonresident,” “race unknown,” and “two or more races.” Race reporting varies across years in the IPEDS, so information pertaining to Pacific Islanders is not available for all years and would be combined with counts for Asian American students.
  3. For the completions data, all CIP codes were converted to current CIP codes using available crosswalks, before applying the classifications based on the NSF taxonomy. The following CIP code conversion required for some IPEDS data files prior to 2004 was added to the crosswalk to convert 1990s to 2000s CIP codes: 8.0199, 8.0299, 8.0899, 8.1299 to 52.19. For the completions data, counts were collapsed across majornum 1 and 2. Completion degree type codes changed slightly in 2010 and later versions of the data, so slightly different groupings were used. For completions data prior to 2010: “3”=Associate, “5”=Bachelor, “7”=Master, “9”=Doctor, “10”=Doctor, “1”=Pre-BA Certificate, “2”=Pre-BA Certificate, “4”=Pre-BA Certificate, “6”=Post-BA Certificate, “8”=Post-BA Certificate, and “11”=Post-BA Certificate. For completions data from 2010 and later: “3”=Associate, “5”=Bachelor, “7”=Master, “17”=Doctor, “18”=Doctor, “19”=Doctor, “1”=Pre-BA Certificate, “2”=Pre-BA Certificate, “4”=Pre-BA Certificate, “6”=Post-BA Certificate, and “8”=Post-BA Certificate.
  4. For all but a few runs, data were not filtered using the First Look Report criteria. The First Look Report uses provisional IPEDS data and therefore totals may be slightly different than those reported in other federal reports, though these differences will be minor.

Table 4-2

a Total revenue is defined as net tuition; state and local appropriations; state and local contracts; federal appropriations, grants, and contracts net of Pell grants; private gifts; grants and contracts; and investment return and revenue from affiliated entities. It excludes auxiliaries, hospital, independent operations, and other sources.

b The federal funding amounts are net of Pell grants, consistent with Delta Cost Project’s definition (Pell grants were excluded if they were reported as federal grants). This category includes revenue received through acts of a federal legislative body, such as direct funds to specific institutions. It also includes revenue from federal governmental agencies for training, research, or public service activities.

Table 4-3

a Education and general expenditures include instruction, research, public service, student services, academic support, institutional support, grants, and operations and maintenance. They exclude auxiliaries, hospital, independent operations, and other expenses.

Table 4-4

  1. IPEDS data, collection year 2015, were used to create the list of institutions throughout this report for analysis run by the American Council on Education. Data in this report
Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×
  1. reflect Title IV participating, degree-granting, public and private, nonprofit, two-year and four-year institutions that offered undergraduate degrees. College Scorecard 2015-2016 data were used to flag institutions that were eligible to apply for federal MSI funding in that given fiscal year through Title III and Title V of the Higher Education Opportunity Act of 2008. Out of 3,129 total institutions, 714 were eligible for MSI designation. Of these institutions, 76 were eligible for more than one MSI designation.
  2. Institutions were classified into a sector based on the institutional category variable and control variable in IPEDS. Within institutional category, all institutions categorized as degree-granting, primarily baccalaureate or above institutions were classified as four-year institutions, and all institutions categorized as degree-granting, not primarily baccalaureate or above and degree-granting, associate’s and certificates institutions were classified as two-year institutions. The control variable was used to classify institutions as public or private nonprofit.

Table 4-5

  1. There is a small amount of missing data for some measures.
  2. A few colleges have multiple MSI designations and thus appear in multiple MSI columns.
  3. Federal legislation does not require that HBCUs have low educational and general expenditures to receive federal designation and funding as it does for MSIs predicated on enrollment. Therefore, HBCUs were omitted from the analysis of this restricted sample.
  4. The mobility rate is calculated as the product of admitting a student whose parents are from the bottom 20 percent of the income distribution (bottom income quintile) for all college students’ parents and having the student earn in the top 20 percent (top income quintile) for all students who entered college that same year. An extended mobility rate is the product of the percentage of students who come from families in the bottom 40 percent (two bottom income quintiles) and end up in the top 40 percent (top two income quintiles) as adults.

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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×

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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
×

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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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Suggested Citation:"4 MSI Investment and Returns on Investment." National Academies of Sciences, Engineering, and Medicine. 2019. Minority Serving Institutions: America's Underutilized Resource for Strengthening the STEM Workforce. Washington, DC: The National Academies Press. doi: 10.17226/25257.
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There are over 20 million young people of color in the United States whose representation in STEM education pathways and in the STEM workforce is still far below their numbers in the general population. Their participation could help re-establish the United States’ preeminence in STEM innovation and productivity, while also increasing the number of well-educated STEM workers.

There are nearly 700 minority-serving institutions (MSIs) that provide pathways to STEM educational success and workforce readiness for millions of students of color—and do so in a mission-driven and intentional manner. They vary substantially in their origins, missions, student demographics, and levels of institutional selectivity. But in general, their service to the nation provides a gateway to higher education and the workforce, particularly for underrepresented students of color and those from low-income and first-generation to college backgrounds. The challenge for the nation is how to capitalize on the unique strengths and attributes of these institutions and to equip them with the resources, exceptional faculty talent, and vital infrastructure needed to educate and train an increasingly critical portion of current and future generations of scientists, engineers, and health professionals.

Minority Serving Institutions examines the nation’s MSIs and identifies promising programs and effective strategies that have the highest potential return on investment for the nation by increasing the quantity and quality MSI STEM graduates. This study also provides critical information and perspective about the importance of MSIs to other stakeholders in the nation’s system of higher education and the organizations that support them.

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