Student Drop-Out Rate Could Reach Record High Amid Cost Of Living Crisis

Universities are bracing themselves for a record number of students dropping out as the cost of living crisis bites.

Students are being squeezed by rising prices and a lack of parental support as family incomes also take a hit, forcing many to reconsider their decision to go into higher education.

Universities have responded by increasing the levels of financial support available for students, but even this may not be enough to head off the looming exodus from higher education.

Almost a quarter (24%) of U.K. students fear they may not be able to finish their degree as a result of the cost of living crisis, according to a survey published today.

This is almost four times the rate seen in a typical year, which hovers around 6.5-7%, although it fell to 5.3% during the first year of the pandemic as alternatives to college became less appealing.

And even the high drop-out rate in the U.S. – where around 40% of students drop-out – could rise as the cost of living rises.

A surge in the number of students dropping out would put a squeeze on university finances, depriving them of much-needed fee income and potentially putting the sector into difficulties.

In the U.K., almost two thirds (63%) of students say they are cutting back on food and other essentials to try to save money and more than four in 10 (43%) are cutting back on heating costs, according to a survey of 1,050 students by the Sutton Trust.

Students from working class families have been particularly badly hit by the rise in costs, particularly in food and electricity.

A third of students from working class families say they have skipped meals to save on food costs. They are also less likely to be able to get financial help from their families than students from a middle class background (38% vs 48%).

One student who responded to the survey said their accommodation costs had risen and they were having to cut down on food, eating just two meals a day. “I come from a low-income household so I haven’t got the ability to ask my family for financial support,” they added.

The survey shows the serious impact of the cost of living crisis on students, according to Sir Peter Lampl, chairman of the trust, which aims to reduce inequality through education.

“It is scandalous that students are skipping meals and having to cut back on essentials, and that a staggering quarter of students say they are now less likely to finish their degree as a result of the crisis,” he said.

The government should urgently review the amount of funding and support available to students, he added.

Earlier this month, the U.K. government announced it would freeze tuition fees and increase funding for cost of living support for students, as well as increasing maintenance loans.

But critics argue the 2.8% rise in maintenance support falls well short of what is needed, with inflation running at over 10%.

In the absence of adequate government support, universities – with both their reputations and their finances to protect – are taking it upon themselves to offer financial help, increasing the amount available in hardship funds.

Warwick University, for example, has announced a £3.5m ($4.3m) package of help for low income students, as well as staff, bringing the overall level of financial support through bursaries, grants and scholarships to £45m ($55m).

And York St John University opened a larder for students just before Christmas, offering free food, toiletries and stationary to help students with the cost of living.