⨠Ten highlights from the past year
1ď¸âŁ Supporting students to and through college is crucial for economic mobility, and research identifies promising practices.
Attending and completing college remains one of the most reliable ways to secure economic mobility. However, many students struggle to make the transition to college and finish their degrees, especially students from disadvantaged backgrounds. A December report by Sarah Reber dug into the evidence on dozens of college access and completion programs that have been tested in the past two decades. This report details the most promising practices, questions for future research, and broader lessons for improvement.
2ď¸âŁ A significant shift in the safety net for low-income families has occurred since the 1996 welfare reform.
Since the 1996 welfare reform, the safety net for low-income families has become more robust, yet its nature has significantly transformed. A piece in the Journal of Economic Perspectives by Lucie Schmidt, Lara Shore-Sheppard, and Tara Watson showed that support largely moved from direct cash assistance to tax credits and in-kind benefits, which primarily benefitted working families and those with married parents while leaving those with no income with far less. This shift highlights ongoing debates about balancing work incentives with hardship prevention and the roles of federal versus state governments in providing support.
3ď¸âŁ Immigration policy changes under the second Trump administration will adversely affect the economy.
Wendy Edelberg, Stan Veuger, and Tara Watson worked together to understand the macroeconomic consequences of immigration policy during the second Trump administration. Based on evidence from the first six months of the year, they anticipate a significant drop in net migration for 2025, ranging from -525,000 to 115,000 people. This substantial decrease in immigration is expected to reduce gross domestic product (GDP) growth by 0.3 to 0.4 percentage points in 2025 and exert considerable downward pressure on labor force and employment growth, potentially leading to near-zero or negative monthly payroll employment growth in the coming years.
4ď¸âŁ As college tuition rises, families take different approaches to covering the cost.
In October, Phillip Levine discussed how families are covering the rising price of college. The trends vary by income level. With the gap between aid and college costs widening, middle and upper-income families tap into parental income, savings, and parental loans. Lower-income students are more likely to work throughout college. This difference in how families pay for college could be to the detriment of academic success for lower-income students.
5ď¸âŁ Increased deportations pose significant challenges for the U.S. child welfare system.
Analysis from Matthew Lisiecki, Kevin Velasco, and Tara Watson examined how increased deportations may impact the child welfare system. The system currently is ill-equipped to handle the potential influx of U.S.-born children with undocumented parentsâapproximately 5.62 million children live with at least one undocumented household member, and 2.66 million have only undocumented parents at home. The Trump administrationâs heightened interior enforcement has increased the likelihood of family separations. Such separations cause significant emotional harm and economic hardship. The authors advocate for federal and state actions to mitigate harm, reiterating the responsibility the U.S. government has for the well-being of these U.S. children.
6ď¸âŁ The future of income-driven repayment for federal student loans is uncertain.
Last October, Sarah Reber and Sarah Turner discussed the litigation against the Biden administrationâs new income-driven repayment plan, known as SAVE, and took a deep dive into student loan repayment policy. They explain how income-driven repayment (IDR) plans can be designed to balance protecting borrowers and limiting costs to taxpayers and unintended consequences like higher tuition and excessive borrowing. IDR policy became more generous to borrowers over time, now accounting for 60% of federal student loan balances. Their work highlights how legal battles have created considerable uncertainty for borrowers. Since this work was published, significant changes to the student loan repayment system were enacted as part of the One Big Beautiful Bill Act (OBBBA). Reber and Turner note that, considering both longstanding problems in the administration of the student loan program and the legal turmoil of the last few years, successful implementation of any reform will require a sustained and coordinated effort among the Department of Education, loan servicers, and borrowers.
7ď¸âŁ Disparities in academic preparation contribute to college enrollment gaps, highlighting the need to address educational inequities.
Sarah Reber, Simran Kalkat, and Gabriela Goodman's research published in May demonstrates that disparities in college enrollmentâparticularly those based on race and genderâare partially driven by differences in academic preparation. Addressing these disparities will require tackling educational inequities both within schools and in the broader social environment. College education remains one of the most reliable paths to economic mobility.
8ď¸âŁ Declining academic performance among American students underscores the potential of high-dose tutoring as a solution.
Kai Smith and Isabel Sawhill documented the decline in American studentsâ overall academic performance over the past decade. The scores of top-performing students have declined modestly, and the scores of lower-performing students have fallen substantially. They propose high-dose tutoring as one of the best ways to help struggling students become more successful. Leveraging service fellows, such as AmeriCorps volunteers, to tutor is one potential cost-effective strategy.
9ď¸âŁ A new blueprint offers bipartisan strategies to ensure the solvency of the Social Security program.
In February, Wendell Primus, Tara Watson, and Jack Smalligan released âFixing Social Security: Blueprint for a Bipartisan Solution,â which details strategies to restore and strengthen the Social Security program's solvency. Current projections indicate that the program's retirement benefits fund will be depleted by 2033. The proposal includes expanding the definition of taxable income, increasing the labor force by broadening legal immigration pathways, and reducing certain future benefits. The plan avoids reducing benefits for current recipients, extends coverage to grandparents raising grandchildren, and continues to rely on payroll taxes for financing.
đ The first 100 days of immigration policy under the second Trump administration reveal significant shifts.
Tara Watson and Jonathon Zarsâ April analysis of the second Trump Administration's first 100 days described significant shifts in immigration policy. Border encounters have plummeted as virtually all asylum pathways have closed, while interior enforcement has expanded into previously restricted spaces. Despite the erosion of due process, deportation numbers remained comparable to previous administrations. Overall, the current administration is striking a harsh anti-immigrant posture aimed at reducing immigrant numbers regardless of legal status or criminal history, while creating fear and uncertainty among those who remain.
