Colleges across the United States are facing a looming crisis: The enrollment cliff, a projected decline in college-age students, threatens to shrink college programs and strain budgets.
At the same time, rising tuition and expenses, the resumption of student loan collections in May by the federal government, and return on investment concerns have made affordability a key issue for students and families.
In response, tuition-free models are becoming more common – not just as a financial aid solution but also as a strategic marketing tool to stay competitive and attract students.
Why We Wrote This
More states are going all in on offering free tuition. How far will the move go to help with the difficulties higher education has faced in recent years – and a predicted pending enrollment cliff?
It’s a strategy playing out in both liberal states like Massachusetts and Republican-led states like Texas. University systems in both states will be tuition-free this fall for households making $75,000 or less in Massachusetts, and $100,000 or less in Texas. In all, nine states now offer income-based free tuition options at four-year programs, with four coming online this year.
It’s not just state schools. Harvard University announced in March that tuition will soon be free for students whose families make up to $200,000 per year. Other elites, such as the Massachusetts Institute of Technology, the University of Pennsylvania, and the California Institute of Technology, have already implemented similar programs to keep their schools accessible to a diverse pool of potential applicants.
“Despite the harsh attacks on higher education, legislators still see the university as one of the most important economic engines the state has. That’s a pretty powerful statement,” says Douglas Harris, chair of the economics department at Tulane University and senior fellow at the Brown Center on Education Policy at Brookings. With more states promising to address the high sticker price of a college degree, he says, “the evidence of progress is reasonably positive.”
A way to reach a wider range of students
Tuition-free models have existed for over a century. California offered free college to residents until the 1970s, when then-Gov. Ronald Reagan declared it too expensive. The modern trend got its start in Tennessee in 2015. To attract more employers, the Volunteer State offered two years of free community college to both high school and homeschooled graduates. In the decade since, free community college has expanded to almost three dozen states, including Kentucky, Nevada, and Massachusetts.
Today, over 100 state schools and private universities have adopted similar programs. As colleges navigate a shifting landscape – including the end of affirmative action and the future of federal grants being tied to ending diversity, equity, and inclusion initiatives – income-based plans offer a way to reach out to lower-income and first-generation students.
Melanie Stetson Freeman/Staf/File
Emily Jin, a first-generation student whose parents immigrated from China, graduated from the University of Texas at Austin in May 2023. The Toward Excellence, Access, and Success Grant Program, known as the TEXAS Grant, which covered her tuition in her freshman year, enabled her to do so.
“If I would not have gotten the financial aid my first year, I would have gone to another university,” says Ms. Jin, now a law student. She says she would have stayed local if she didn’t get money to attend UT Austin, the flagship school of the Texas system.
In 2023, the University of Arkansas at Little Rock implemented its Trojan Guarantee scholarship, which ensures that federal Pell Grant recipients pay no tuition for a bachelor’s degree.
In the scholarship’s first year, UA Little Rock reversed a 15-year decline with a 3.7% jump in undergraduate enrollment, fueled by a nearly 29% surge in first-time freshmen. Transfer student enrollment also spiked 18.2%, the highest increase in the university’s history.
“We saw this as kind of our niche,” says Jonathan Coleman, interim assistant vice chancellor for enrollment management at UA Little Rock. He says he saw students shifting their decision-making priorities from program and career interests, to now a majority of students ranking costs as the paramount factor. “Where can I afford to go to school and I will figure out the degree,” he says.
That aligns with the view of Ms. Jin, the University of Texas graduate. She says if a university offered no financial aid at all, “that would deter me from applying.”
Often in tuition-free situations, families still need to cover housing, meals, and sometimes books. Schools should not make unrealistic promises about what they can provide, Mr. Coleman adds.
But the need to make a plan is staring down many schools. The number of high school graduates is expected to peak this year and decline through 2041, resulting in 13% fewer high school graduates, according to a report published in December by the Western Interstate Commission for Higher Education.
Colleges and universities have to alter their approach to attracting students to counter that cliff, says Carrie Phillips, UA Little Rock’s chief communications and marketing officer, who has studied what schools should do to prepare. In the case of her school, she says there are multiple factors driving interest in providing a financial incentive.
“We were the first people in Arkansas to have any kind of approach to affordability,” she adds. Before the Trojan Guarantee program, the university created a half-off tuition scholarship, which started because of pandemic-related issues that students were having. Both offerings are for in-state students.
In a competitive landscape, she says, strong branding – and leaders who understand it – is crucial for colleges to attract students. She suggests that schools should highlight affordability through scholarships, specialized programs, and community partnerships to stand out. They should also tailor outreach to transfer, military, and nontraditional students.
Trying to make enrollment easier
Some administrators see bright spots in the numbers.
“Even though there could be a demographic decrease related to high school graduates, we’re getting more of those graduates entering into higher education,” says University of Massachusetts Dartmouth Chancellor Mark Fuller.
Free tuition as an enrollment strategy already seems to be paying off elsewhere in higher education. In Massachusetts, enrollment at community colleges jumped 10% to 20% systemwide and even up to 40% at specific places after tuition became free, regardless of income eligibility.
In Texas, enrollment spiked at Austin Community College after free tuition to high school graduates was announced in 2024. Within a single month, registration for the fall semester increased more than 27% year over year and more than 78% from fall 2022.
In 1960, only 7% of Americans over age 25 had graduated from college. In 2022, nearly 40% of people over 25 had graduated from college. However, college enrollment rates still vary greatly depending on the income of a student’s family. Meanwhile, only 36% of Americans have significant confidence in higher education.
“There are a lot of families and their children who don’t think education is attainable,” says Dr. Fuller. “We’re trying to streamline the process so that people don’t run into barriers, because we benefit as a nation when we have a more educated population.”
As she takes out thousands of dollars in loans for law school, Ms. Jin says she feels even more strongly about financial incentives for students. “I think scholarships are incredibly important for retention and for attraction.”
