Harvard Business School will announce a $12.5 million donation Monday, its largest ever for scholarships, aimed specifically at helping students who are the first in their family to attend college.
Although undergraduate schools have increasingly focused their recruitment and financial aid efforts to attract more first-generation college students, graduate programs have lagged behind.
But money from Jonathan Lavine, co-managing partner of Bain Capital, and his wife, Jeannie, will be used to increase access for students who may struggle to afford the nearly $107,000 annual cost of attending Harvard Business School.
“There are students who wouldn’t think of applying,” said Jeannie Lavine, who along with her husband graduated from the business school. “This makes the opportunity available for students who think they couldn’t even try.”
Students who are first in their family to attend college may be reluctant to take on more debt to get a master’s degree, be dissuaded by the high price tag of graduate school, and feel more pressure to immediately start working.
But earning an advanced degree can give workers an edge in the job market. According to the US Bureau of Labor Statistics, the unemployment rate last year for workers with an advanced degree was 2.2 percent, compared to 2.7 percent for those with just a bachelor’s degree.
“For many students, being admitted to Harvard Business School becomes a reality only when they know there is financial support available,” said Nitin Nohria, the dean of the school.
The business school is more reliant on student tuition payments to fund its programs than federal grants and aid. Still, it offers about half of its students some level of financial help. The business school distributes about $35 million of financial aid annually with students receiving on average $37,000 a year.
But only about 9 percent of the 930 incoming HBS students are the first in their family to have attended college. That compares to about 16 percent of incoming undergraduate freshmen who identified as first-generation, according to an annual survey by the school’s newspaper, The Harvard Crimson.
Financial barriers are part of the problem of increasing enrollment of first-generation students, Nohria said.
But he acknowledged that the business school faces other challenges.
These students first need to complete their undergraduate degrees, Nohria said.
Graduate schools still rely on the efforts of undergraduate institutions to ensure that more first-generation students go to college, complete their bachelor’s degrees, and are prepared to earn a master’s, Nohria said.
A study by the Pell Institute in 2011 found that low-income, first-generation students still struggled in undergraduate programs. After six years, only 11 percent of low-income, first-generation students had earned bachelor’s degrees, compared to 54 percent of their more advantaged peers, due in part to less academic preparation, less financial support from their parents, and a greater likelihood of having jobs and other obligations outside of college, according to the report.
‘For many, being admitted to Harvard Business School becomes a reality only when they know there is financial support available.’Nitin Nohria, Harvard Business School dean
Still, the business school has been trying to increase the pipeline of underrepresented and minority students through summer training programs for rising college seniors, Nohria said.
Nohria said he hopes the scholarships increase access to HBS to students, but also encourage them to take less lucrative jobs in the nonprofit sector after graduation, because they won’t have to worry about paying off their loans.
Under the terms of the Lavine’s donation, $2 million of the $12.5 million will go directly to two scholarships, including one named for Jeannie Lavine’s father, Herbert J. Bachelor. About $10 million will go toward matching gifts from other donors to increase the number of scholarships that the business school offers.
Bachelor, 73, came from a Navy family and his father discouraged him from going to college, preferring that he enlist, Jeannie Lavine said.
He attended Harvard as an undergraduate, while working full-time to defray the costs. Although he loved science, at graduate school he opted to study finance, in part to ensure he would make enough money to pay off his loans, she said.
“He had a successful career in investment banking. But he talks about what could have been, if he had the choice,” Jonathan Lavine said. “Going to college should increase your opportunities, not narrow them.”Deirdre Fernandes can be reached at email@example.com. Follow her on Twitter @fernandesglobe.