In today’s economy, a college education is essential for getting a good job and entering the middle class.  Yet, despite this reality, college costs are rising beyond the reach of many Minnesotans. State policy decisions have played a significant role in this rise by shifting costs onto students and families though declining state support. Minnesota’s investment in higher education has decreased considerably over the past two decades, and its financial aid programs, though still some of the country’s most expansive, fail to reach many students with financial need. Students and their families now pay—or borrow—much more than they can afford to get a higher education, a trend which will have grave consequences for Minnesota’s  future economy. 

The Great Cost Shift: How Higher Education Cuts Undermine The Future Middle Class. 

This brief is based on the Demos report “The Great Cost Shift”, which examines how nationwide disinvestment in public higher education over the past two decades has shifted costs to students and their families. The report outlines how such disinvestment is magnified by rapidly rising enrollments, and its effects are felt particularly acutely as student bodies become more economically, racially, and ethnically diverse. This fact sheet focuses on Minnesota, highlighting the trends in the state’s higher education funding over the last twenty years. 

State Higher Education Funding Is Dramatically Declining

Minnesota’s overall funding for higher education has declined precipitously since its pre-Great Recession peak in 2008.1  Funding per student in the state, once consistently above the national average, has fallen even more dramatically, since enrollments have risen significantly even as total funding fell.  Though state funding for higher education has historically risen and fallen in tune with the business cycle, the post-Great Recession decline appears to be a worrisome departure from the historical pattern.

  • Overall, Minnesota’s higher education funding fell from its peak of $1.73 billion in 2008 to $1.29 billion in 2013, a 26 percent decline.2
  • Funding per full-time equivalent (FTE) student has fallen 29 percent since 2008, and 45 percent since 2001. 
  • Because of this decline, Minnesota’s funding per FTE student—$6,533 in 2013—now ranks 26th in the nation, below the national average.

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  • 1All years in this brief have been shortened to represent the fiscal year; thus, 2008 represents fiscal 2008, which covers the period between mid 2007 and mid 2008.
  • 2All dollar figures in this brief have been adjusted for inflation to allow a more accurate comparison between different years.