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A historical Examination of Financial Aid Trends in american boarding Schools: 1935-2010

1914

Porter Sargent Handbooks A Division of Carnegie Communications A Historical Examination of Financial Aid Trends in American boarding Schools: 1935-2010

Copyright © 2012 by Carnegie Communications

Daniel P. McKeever Senior Editor Porter Sargent Handbooks A Division of Carnegie Communications Table of Contents

Introduction 1

1935 Trends 3

1953 Trends 5

1965 Trends 7

1980 Trends 9

1995 Trends 11

2010 Trends 13

Conclusion 15 Financial Aid Trends | Page 

Introduction

Public elementary and secondary public schools have always been part of the fabric of American society, but the United States has an equally long tradition of private education. Despite the availability of free schooling for their children, many parents— since the 1800s—have sought out nonpublic schools in an effort to better prepare their children for college and the workforce. For these parents, finances play an important role in their ability and willingness to choose private education for their families. With this in mind, it is interesting to consider the historical affordability—both in terms of tuition costs and financial assistance granted—in the private school realm.

With access to a wealth of private school information that dates back to 1914, Porter Sargent Handbooks is in a unique position to analyze data and assess trends in American elementary and secondary independent education. The Handbook of Private Schools, the nation’s original private school resource, debuted in 1915 and has been an authoritative annual reference ever since.

The Handbook lists and describes approximately 1700 of the nation’s top boarding and day elementary and secondary private schools. For the examination that follows, we will focus on seven-day boarding schools as we examine trends in financial aid disbursement over a period spanning 1935 to 2010. Our cross-section of schools comprises 30 institutions from throughout the country and reflects boarding schools of varying levels of affordability. Although not all institutions supplied data for each edition of the Handbook, our overall data set is substantial. The schools to be examined during this project are as follows:

• CFS: The School at Church Farm (Exton, PA) • (Cheshire, CT) • (Wallingford, CT) • Cranbrook Schools (Bloomfield Hills, MI) • (Culver, IN) • (Deerfield, MA) • Emma Willard School (Troy, NY) • Flintridge Sacred Heart Academy (La Canada Flintridge, CA) • (Groton, MA) • (Hoosick, NY) • The (Lakeville, CT) • (Lakeville, CT) • (Lawrenceville, NJ) • Linsly School (Wheeling, WV) • McCallie School (Chattanooga, TN) • (Milton, MA) • New York Military Academy (Cornwall-on-Hudson, NY) • (Hightstown, NJ) • (Andover, MA) • (Exeter, NH) • Rabun Gap-Nacoochee School (Rabun Gap, GA) Financial Aid Trends | Page 

• Randolph-Macon Academy (Front Royal, VA) • St. Andrew’s-Sewanee School (Sewanee, TN) • Saint James School (St. James, MD) • St. Paul’s School (Concord, NH) • Shattuck-St. Mary’s School (Faribault, MN) • (Watertown, CT) • The Thacher School (Ojai, CA) • The Webb Schools (Claremont, CA) • Western Reserve Academy (Hudson, OH) Financial Aid Trends | Page 

1935

The United States economy was in dire straights in the mid-1930s. In the wake of the Great Depression, which hit the country hardest between 1930 and 1932, the US was still experiencing a high unemployment rate of about 20% (down from a Depression- era high of approximately 25%). Despite signs of hope and turnaround during these early years of the Franklin Delano Roosevelt administration, economic progress was slow.

How did private schools respond to the financial needs and constraints of their student bodies? With tough economic conditions and a Gross Domestic Product (GDP) of merely $73.3 billion, it is not surprising that 1935 tuition and boarding fees for our selection of Handbook schools ranged from $100 (Rabun Gap-Nacoochee) to $1800 (Thacher), quaint by current-day standards. The schools in our survey certainly approached student aid differently during this time. On average, 22.6% of students received financial aid, but the institutions that supplied aid data that year tended to fall significantly higher or lower than that level. On the conservative side, Shattuck- St. Mary’s awarded aid to 6.8% of the student body and Cheshire Academy 9.9%. Hoosac and The School at Church Farm followed a different path, opting to grant assistance to 55.3% and 58.8% of their students, respectively.

It is also interesting to consider the degree of assistance offered to those receiving aid. For the most part, 1935 awards were significant: On average, 60.4% of tuition was covered by financial aid grants. Data was more consistent in this area, with St. Paul’s (45.6% on average), Choate (50%) and Shattuck-St. Mary’s (64.2%) at a similar level, for instance. Notably, two schools, Hotchkiss and The School at Church Farm, gave 100% aid to all recipients. Financial Aid Trends | Page  Financial Aid Trends | Page 

1953

Economic conditions in the US were far more robust in 1953, less than a decade removed from World War II. The GDP of $379.3 billion illustrates the tremendous growth that the economy had experienced since the 1930s. The national unemployment rate that year was an impressive 2.9%.

With job prospects, home ownership and optimism on the rise, how did America’s private schools respond to the financial needs of their students? Tuition rates had increased only modestly over this 18-year period. At $350 per annum, Rabun Gap- Nacoochee continued to charge the lowest tuition and room and board, while most rates fell in the $1500-2000 range. Thacher and Choate were slightly higher, at $2100 a year.

Perhaps due to the combination of newfound prosperity and fairly stable tuition rates, our sample of Handbook schools showed more restraint in financial giving. An average of 14.2% of students received aid in 1953, down from the 1935 rate of 22.6%. In addition, a full one-third of the schools in this sample who supplied data provided aid to fewer than 8% of their pupils. Unfortunately, total aid amounts were not detailed in the 1953 Handbook, but it is probably safe to say that families were expected to assume a greater share of private education expenses during the 1950s. Financial Aid Trends | Page  Financial Aid Trends | Page 

1965

After a period of slow economic growth in the early 1960s, a boom period commenced at mid-decade. Unemployment was only 4.5% in 1965, and it fell below 4% as the decade concluded. A GDP of $719.1 billion reflects the growth of the US economy.

Modest tuition increases continued at the nation’s private boarding schools, with Rabun Gap now up to $800 annually and three schools—Choate, Lawrenceville and Emma Willard—topping the list at $3000. Thanks perhaps to increasingly healthy endowments, financial aid rebounded a bit from 1953 levels: On average, schools awarded aid to 19.1% of their students.

St. Paul’s led the way with a 49.1% rate, followed closely by St. Andrew’s-Sewanee, at 45.5%. A healthy average award of 46.9% certainly increased private school affordability during this time. Particularly impressive were Cranbrook and Phillips Exeter, whose aid covered an average of 86.8% and 78% of total tuition, respectively. Coupled with reasonable private school tuition increases, these well-funded financial aid programs made it possible for many more families to consider boarding schools for their children. Financial Aid Trends | Page  Financial Aid Trends | Page 

1980

The United States was in the grip of a quite severe recession in 1980, with a national unemployment rate of 7.1%. While it was up to nearly $2.8 trillion at this point, the GDP would fluctuate up and down in the early part of the decade.

Private school tuition and boarding fees continued to rise, but at a reasonable rate. In our 30-school sample, the gap between lowest and highest tuition had closed markedly by 1980. Most tuition rates landed in the $5000-6000 range. Randolph-Macon and Linsly charged only $3995 annually, while Culver topped the list at $6550.

The percentage of students receiving financial aid had changed only slightly from 1965: up from 19.1% to 20.7%. Cheshire granted aid to 8.4% of its student body, Cranbrook 10.1% and Saint James 11.9%. On the high end, four schools cracked the 30% barrier: Phillips Academy (31%), Emma Willard (32.4%), St. Andrew’s-Sewanee (34.2%) and Shattuck-St. Mary’s (36.4%).

Schools responded to the country’s tough economic conditions by continuing to provide substantial awards to their financial aid recipients. At 49.8%, aid at our cross-section of schools typically covered half of tuition and board. The percentages at most schools climbed well into the 30s and beyond, with only one school—Flintridge Sacred Heart at 13.7%—falling below 20%. On the high end, eight schools exceeded the 60% level, including two—St. Paul’s at 78.1% and Western Reserve at 71%—that topped 70%. Financial Aid Trends | Page 10 Financial Aid Trends | Page 11

1995

Driven by a surge in productivity (aided in large part by the increasing computerization of the workforce), the US economy was growing at a fast clip in the mid-1990s. By 1995, the country’s GDP had escalated to $7.4 trillion. Unemployment that year averaged 5.6%.

Inflation was declining in the general economy at this time, but tuition rates had certainly experienced a spike since 1980. Tuition and board charges typically reached at least the middle to upper teens in 1995, with only one school, Randolph-Macon ($9445) coming in under $10,000. One-third of the schools in the sample exceeded $20,000, led by Groton at $21,850 and Choate at $21,075.

In 1995, the schools in our sample awarded aid in a significantly more liberal manner, with an average of 31.3% of pupils receiving awards, up more than a third from 1980 levels. It is perhaps not coincidental that independent schools were making a concerted effort during this time to further diversify their student bodies, an effort that continues to the present day. Attainment of a more socioeconomically diverse student body necessitates heightened sensitivity to family finances and tuition affordability; this may well be a factor in the escalation of awards.

While no school provided assistance to half of its student body, several came close— led by Emma Willard (49.8%), Shattuck-St. Mary’s (47.4%) and Peddie (46.1%). Two schools—Cranbrook at 15.9% and Milton at 16.8%—came in below the 20% mark. Most other schools in the sample provided aid to well over one-quarter of their students, thereby lessening the impact of escalating costs on many families. Financial Aid Trends | Page 12

Tuition increases during this period were also mitigated to some degree by increasingly generous financial aid awards. The average percentage of tuition charges covered by financial aid rose from 49.8% in 1980 to 57.2% in 1995. Of the schools supplying data, only one—Linsly (28.2%)—gave an average award of less than 30% of boarding tuition. On the other hand, six schools exceeded the 70% mark; in fact, Groton even slightly surpassed 80%.

While boarding school attendance seemingly became less feasible financially for less affluent families due to escalating tuition costs, generous school aid programs—in terms of both the number of students receiving aid and the average size of aid packages—served to soften the monetary blow for families of more limited means. Modest unemployment levels during this time also resulted in more families having the resources to finance an American boarding school education. Financial Aid Trends | Page 13

2010

On the heels of the banking and real estate crises of late 2008, the US economy was still staggering in 2010 (despite a GDP of $14.5 trillion). Historically high unemployment rates hovered near 10% nationally in January and February before averaging out at 9.6% for the year.

Despite the poor economy, boarding school tuition rates continued to escalate, much like those at our nation’s colleges. Only two schools in our sample—Randolph-Macon at $23,640 and Linsly at $27,750—came in below the $30,000 mark. While no board- ing tuition reached $50,000, just about half of the school rates exceeded $40,000, led by Groton at $48,495.

No doubt aware of the financial commitment associated with an American boarding school education, our cross section of schools offered financial aid to a substantial portion of their student bodies. In fact, the average percentage of recipients rose slightly from an already impressive 31.3% in 1995 to 34.8% in 2010. Three schools—St. Andrew’s-Sewanee (55.5%), Emma Willard (51.6%) and Shattuck-St. Mary’s (50%)— provided assistance to at least one in two students, a noteworthy accomplishment in any age. Indian Mountain was the only school providing assistance to fewer than one student in five, but they came quite close at 19%. More than half of the respondents in our sample (17) exceeded the 30% level, indicating a great willingness on the part of these schools to make private school education more affordable. Financial Aid Trends | Page 14

The average size of school awards continued to be quite generous, although the percentage of tuition covered by the schools in our sample dropped slightly from 57.2% in 1995 to 54.1% in 2010. Flintridge Sacred Heart (15.2%) and Randolph- Macon (18.3%) were the only schools coming in under 20% on average. Especially lavish in their awards were St. Paul’s (87.7%) and Lawrenceville (85%). Roughly half of the sampled schools exceeded the 50% plateau. Financial Aid Trends | Page 15

This data provides a mixed view of boarding school affordability in 2010. The combination of extremely poor economic conditions and expensive tuition rates certainly provided financial hurdles for families seeking to send their children to boarding school. On the other hand, need-based giving on the part of the schools was substantial enough to make boarding school attendance financially possible for the less affluent.

Conclusion

Thanks to nearly a century of data collection and reportage in The Handbook of Private Schools, we have been able to examine financial giving at American boarding schools from 1915 through 2010. Over the decades, costs associated with private education have certainly escalated. There is no question, however, that boarding schools have consistently responded to the financial limitations of many families by not only assisting a substantial percentage of their students, but also by making sure that their awards are ample enough to make boarding school attendance possible for lower- and middle-class households.

While costs associated with a boarding school education have become increasingly burdensome in recent decades, the schools in our sample have acknowledged the financial commitment required and have responded by actively maintaining high levels of aid. As a result, no family should feel that a boarding school education is out of reach before at least discussing financial considerations with admissions and financial aid officers.

Sources

Unemployment Data from United States Department of Labor—Bureau of Labor Statistics: www.bls.gov

GDP Data from United States Department of Commerce—Bureau of Economic Analysis: www.bea.gov