Running head: UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 1

The Impacts of University Budget Allocation on Student Retention

Final Mini Research Proposal

Joshua Jarvi

Loyola University Chicago

UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 2

The Impacts of University Budget Allocation on Student Retention

Introduction

Institutions of higher education are constantly considering how to improve their practices,

procedures, and efforts to best serve their students and run smoothly at all levels of the

organization (Ackerman & Schibrowsky, 2007). Some aspects that universities and colleges look

into are institutional structure, student success, student retention, campus environments, and

budgeting and financial affairs. The purpose of this study is to research two of these areas,

university budgets and student retention, and analyze the current literature existing around these

two issues and extrapolate any potential overlap. Overall, the hope is to find that a more student-

centered budgetary model would assist in the increase in student retention rates on college

campuses. So, the research question that is looking to be answered through this study is, what

areas of a university budget should receive a higher percentage of funding to increase student

retention rates.

Overview of Research Design

There are three different areas of research that will assist in answering this question. The

first area of research will focus on current student retention efforts. Most institutions focus on

post-enrollment retention strategies such as student support services and involvement

opportunities. This area of research will assist in analyzing the constructs that are currently in

place for students and how they can be improved in the future. The second area of research will

focus on current financial affairs and budget practices that institutions implement. This area of

research will help better explain the processes that are in place to formulate university budgets

and what steps are needed in order to create change within institutional structures. The third part

of research will focus on the loose ties and synthesis between university budgets and how it
UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 3

affects student success and retention. There is not a lot of research that focuses on this area,

which this research study will hopefully pave the way to enhance the breadth and depth of data

that focuses on this correlation.

Student retention is the rate at which students are completing their degree from start to

finish at an institution without transferring to a different institution, being academically

dismissed, or simply leaving an institution (McLaughlin, Brozovsky, & McLaughlin, 1998). The

qualitative research design that will be utilized for this proposal is an intrinsic case study. The

goal and purpose of an intrinsic case study is to holistically understand and analyze a certain

entity and all of its components (Johnson & Christensen, 2014). Applying this method to a

university setting, it is important to understand the organizational structures that exist within a

college or university, how those components work together, and how does one go about creating

institutional change. So, it would be important to start by implementing this case study at one

select institution to analyze effectiveness through a longitudinal study. If it proves to be

effective, it can be applied to many different institutions which will then prove generalizability.

It is also crucial to understand the impacts that change to a certain component will have on the

entire institution. Another reason that an intrinsic case study is to be applied to this study is

because there is little known published research on budget shifts and their impact on student

retention. Inferences can be made to inform this topic, but it is not explicitly stated in much of

the research found.

Significance of Study

The significance of this study lies deep within higher education and the current emphasis

on institutional effectiveness and conservative university budgets. Currently, many colleges and

universities across the country, including Loyola University Chicago, are analyzing areas of the
UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 4

university where spending can be cut. This research study is aiming to shed a light on the

importance of student support services and that budgets in this area should not be cut, but be

increased to show the significance and impact they have on student retention. This study can also

highlight the potential opportunity to facilitate collaboration between academic affairs and

student affairs within institutions of higher education. It is too often that faculty and university

administration do not interact or collaborate to best support the students, but see themselves as

separate entities within the institutional structure. It is also proven that it is more cost effective

for an institution to retain a student that it is to recruit a new student. Therefore, funding

collaborative efforts between faculty and student affairs professionals to assist in retention can

lead to being the most cost effective approach to increasing student retention rates.

Limitations of Study

One limitation of this study that exists at the forefront is that through the initial intrinsic

case study of one institution, it does not take into consideration any other institutional formats or

structures that are in place, such as public or private institutions, rural or urban, two-year or four-

year, as well as many other factors. The different types of institutions that exist may not be able

to adapt to this model, and may require certain pre-existing resources to be effective. Another

limitation of this study is the financial capital that institutions have, and if they have the ability to

be flexible with their budget. Many institutions are currently in a budget crisis or deficit, which

will not allow them to allocate funding to areas such as student support services. Finally, the last

limitation to be brought up initially is the willingness to change. Many institutions have a long-

lasting history of being stuck in the way that they operate. If upper-level administrators are not

willing to adapt new principles and practices to test effectiveness, then they will never

acknowledge what practices may best service their students, and institutional effectiveness as a
UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 5

whole. The overarching limitation of this study is the overall generalizability of the results due to

the fact that this study is only being implemented at one institution initially. However, upon any

positive research findings, application at other institutions can prove generalizability.

Literature Review

Impacts on Student Retention

The goal of many non-profit institutions of higher education is to recruit students who

show a high level of college readiness and can remain at that institution throughout the entire

time they are pursuing a degree, and graduating from there as well. In order to do this, there are

several components that factor into a student’s ability to fulfill this goal. A student needs to feel

that their academic goals can be met at the institution, they are feeling supported along the way,

and they have a sense of belonging and see themselves fitting into the institution (Padilla, 1999;

Roberts & Styron, 2010). If a student is not feeling a sense of connectedness within the

institution, they are likely to not be passionate about their work, and will often seek out

opportunities elsewhere and transfer to a different institution.

Student support services are put in place to offer the knowledge, resources, and skills

necessary to students to succeed throughout the years they are in college. However, it is

important to understand that student retention does not only take place once the student is on

campus. The four different practices that can enrich the student experience and improve college

student retention are school-level motivation at a younger age, recruitment of capable students at

the appropriate caliber, holistic overview of the academic experience prior to enrollment, and

ongoing student support (Tomkinson, Warner, & Renfrew, 2002). The idea of motivation can

stem from many different places, but this study shows that it cannot be found throughout the

college years. Students who perform well in the university setting often have been committed to
UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 6

their academics throughout their life. So, if the students that are entering college already have a

strong commitment for academic achievement, it is likely that they will perform well in the

college setting and follow through with graduation. The university also needs to recruit students

who are prepared for the heightened level of education. If the admissions standards for an

institution are too low, or are non-existent, these students will often struggle even with the

ongoing support systems that exist on campus. The last factor that students need to be

accustomed to before they begin their college career is to fully understand the academic

curriculum before enrollment. Students need to know if that institution offers the degree that they

want to pursue, that they are pursuing a degree that will benefit them later in life, and they feel

capable to commit to the requirements that are set in place (Tomkinson, Warner, & Renfrew,

2002). The final component to increase the student experience and retention is the idea of

ongoing support once they get to campus. Without the ongoing support, students may never feel

fully acclimated, understand how to succeed at the college level, and ultimately leave the

institution due to the lack of success they are met with (Lang, 2001; Padilla 1999; Tomkinson,

Warner, & Renfrew, 2002).

Another reason why students are leaving is because they do not feel that the institution

they are attending is meant for them. A lot of times, students who hold marginalized identities

often do not see themselves aligning with many institutional practices, representation in the

classroom, on university media publications, or within the rest of the student body (Lang, 2001).

When students who hold marginalized identities feel oppressed on a college campus, it can lead

to feelings of self-doubt, low self-esteem and confidence, and lack of motivation to strive for

success. This can be detrimental for students’ mental and emotional health, and can often lead to

a decrease in student retention rates on a college campus, especially for marginalized students.
UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 7

This dates back to the idea that institutions of higher education are only intended for privileged

individuals who have the social and cultural capital to succeed in education.

How Budget Allocation Can Affect Student Retention

Without financial capital, institutions of higher education are unable to prove to be

effective (Smith & Smith, 1985). Colleges and universities rely on funds from the state,

donations, tuition dollars, and other identifiable means to gain the appropriate amount of money

to run as an institution. Common expenses that are not typically thought of are payment of all

employees on campus, utilities and maintenance to uphold building operations, landscaping,

transportation, and scholarship funds. Throughout these areas, it is too often that student support

services get a significantly lower section of the budget allocated to them compared to academic

affairs (Henry, Fortner, & Thompson, 2010). In order to increase student retention by looking at

a university budget, sections of the budget need to be strategically allocated in order to ensure

student success throughout the entirety of their college career.

The areas that have proven to be the most effective in college student retention are

student programming, wellness tactics, student leadership development, and a holistic focus on

students from enrollment to graduation (Fike & Fike, 2008). The idea of student programming

can foster connections between students, as well as feeling connected to the university. They

may also discover areas of growth within themselves, which can then motivate them to focus on

being academically successful to reach their goals (Lang, 2001). Wellness tactics an allow

students the opportunity to discuss hardships that they are facing, and can pave the way for

higher levels of student mental health and increased motivation inside and outside of the

classroom. This can also pave the way for students to seek out challenge in other areas knowing

that they have the support system to back them up. These areas of challenge can be getting
UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 8

involved in student organizations, taking on leadership roles within different areas of the

university, and seeking out additional opportunities to get involved in their career field as well

(Fike & Fike, 2008). If universities allocated higher levels of the budget to these areas, it would

allow students to have top notch services in place to ensure their success throughout their college

career.

Implementing Institutional Change

Often times, university administration acts in a way that does not include all levels of the

institution in decision that affect multiple groups within the organization. Many university

officials operate in the sense that they are running a business and need to profit, but do not

understand that they are in place to serve the needs of the students (Ackerman & Schibrowsky,

2007). Upper-level administrators in higher education often forget what it is like to be a college

student and do not understand that society has shifted since they completed their degrees. When

individuals at higher levels of the organization make decisions for everyone involved,

individuals often feel left out and underappreciated. This idea leads to lower levels of motivation,

low self-esteem, and a desire to leave the situation (Lang, 2001).

In order for institutional change to go over smoothly for all levels, they need to feel as

though they are included in the organizations decision-making process (Jones & Braxton, 2009).

Since institutions of higher educations were initially built for the students to attend them, it is

only right to include students in the decision-making process on efforts that would directly or

indirectly affect them. If students see themselves as active stakeholders and a strong level of

consideration from upper-level administration, they will feel that more is up for loss if they fail

academically (Yorke & Longden, 2004). So, including students on institutional change factors

can have a positive increase on student retention due to students feeling as though their voice is
UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 9

heard at all levels of the institution, the feeling of a stronger connection to the inner workings of

the institution, and the desire to see their decisions come into action while still attending the

institution (Hillman, Tandberg, & Fryer, 2015; Jones & Braxton, 2009).

Implications for International Higher Education

A lot of this literature on student retention, budgeting, and institutional change all focus

on American higher education. International higher education is also facing a lot of struggles

with student retention. In England, students are often seeking opportunities to get educated in

their native country, but looking to be employed in other areas of Europe or the world. The issue

that these students are facing is the realization that they may not be able to achieve their

professional goals that they set for themselves once they are at university (Thomas, 2002). These

students are finding that finances play a larger role in their education, and need to fund

themselves to partake in immersion programs in other countries during their time in college in

order to set themselves up for success. Once they learn of this, they often times cannot afford to

do so, and either change their intended career field or lose the passion to pursue higher education

at all. In Australia, there are seeing an overall decline in individuals enrolling in college. This is

due to the focus on entrepreneurial and independent studies, and the lack of perceived need of a

formal education (Gale & Parker, 2017). This demonstrates the need to adapt to the needs of

student in order to see an increased number of students enrolling in higher education, and

finding value in graduating and obtaining a college degree.

Methodology

Participants

For this study, it will focus on one institution for a four year period. This will provide the

opportunity to analyze trends over multiple years and see an entire class of students through from
UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 10

enrollment to graduation, provided they graduate in four years. As for the individuals

participating in this study, it is important to focus on future and current students at institutions of

higher education, as they are the sole factors in contributing to the data of student retention

statistics. When selecting participants for this study, it is important to keep in mind the different

identities that students may hold who are attending college. Non-traditionally aged students,

outside of the age ranges of 18-24, may have different reasons for leaving an institution and

traditionally aged college students. Students who hold marginalized identities in the areas of

race, ethnicity, sexual orientation, gender identity, and religious affiliation all factor into who

these students are as individuals. If these factors are not taken into consideration, the data can be

skewed to only be applicable to students who hold a certain number identities. Therefore, it is

important to be intentional to have a diverse array of participants to gather data that can elicit

different findings than individuals who only hold a certain set of identities.

Research Instruments

The research design that is most applicable to this higher education environment is an

intrinsic case study. This method will allow for a holistic and detailed approach to understanding

how the educational system operates, what change looks like for the organization, and it offers

the opportunity for a longitudinal study to track trends, variances, and extrapolating cause and

effect data. The focus of this research will be on qualitative data, and the research instruments to

develop qualitative data will be surveys and interviews. These surveys and interviews will be

administered before enrollment and after leaving the institution, and they must be given to

students who are able to provide expectations of the college experience, and why they decided to

leave the institution. These qualitative research methods will be applied to the student

demographic data to analyze trends of student retention to see where they can be applied.
UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 11

Procedure

The first method of data collection that will be implemented in this case study are

interviews. Prior to enrollment at campus visits and at their orientation session, students will

have the opportunity to partake in an interview where they will be asked questions on their

expectations of the college experience. These questions will include topics such as support

services offered, programs available to attend, academic rigor, academic curriculum offered,

goals throughout the college experience, and goals once they complete their degree. This will

give students the opportunity to ask questions as well, in order to get a better understanding of

the college experience prior to enrollment. These interviews will be an opt-in experience, and the

students who are likely to participate in this study are more extraverted students who are more

passionate about their educational experience and are able to easily articulate their expectations

prior to enrollment.

Students will also be required to partake in surveys prior to enrollment detailing this

information too. This requirement will be e-mailed out to students three weeks prior to their

orientation session and required to be completed before the first day of classes. This will provide

students to disclose some of the identities that they hold, as well as the opportunity to answer

questions outlining their expectations in the academic setting. Many of these questions will

mirror the ones asked in the interview, but offered the opportunity to outline the answers in a

way that is more fit for students who have the tendency to be less vocal, more introverted, and

would not seek out an opt-in interview when visiting campus.

If a student decides to leave the institution prior to fulfilling degree requirements and

graduating, they will be sent an exit survey asking the reasons for their departure. This will help

university administration understand the areas of the institution that require more attention,
UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 12

financial assistance, and overall improvement to be meet the needs of students. These exit

surveys will also be compared to the students’ entrance surveys to see if the expectations that

they had before they entered college were met, or if there were surprising expectations that

surfaced throughout the college years. These survey and interview methods hope to gather

participations from individuals who hold a multitude of identities, are traditional or non-

traditional students, and have an array of needs to succeed in college. The results of this study

will hope to identity areas that need financial assistance and support.

Conclusion

College student retention is an issue that all universities are currently facing. The

retention of students in 2017 is seeing an all-time low, at an approximate rate of 42% overall

Gale, T., & Parker, S. (2017). To increase this number, institutions of higher education need to

think of new ways to focus on meeting the needs of students. It is easy to understand what areas

colleges and universities see as a major priority by looking where most their budget is allocated.

This research study is hoping to solve the question of where an institution’s budget should

reallocate funds to increase their college student retention rates. Through qualitative research

methods of surveys and interviews, it is hopeful that students will disclose the areas where they

felt their needs were not met, and that university administration can focus more on those certain

areas of student support services. Moving forward, this area of study is crucial to the overall

success of college students and effectiveness of institutions of higher education.

UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 13

References

Ackerman, R., & Schibrowsky, J. (2007). A business marketing strategy applied to student

retention: A higher education initiative. Journal of College Student Retention:

Research, Theory, and Practice, 9, 307-336.

Fike, D. S., & Fike, R. (2008). Predictors of first-year student retention in the community

college. Community College Review, 36, 68-88.

Gale, T., & Parker, S. (2017). Retaining students in Australian higher education: Cultural

capital, field distinction. European Educational Research Journal, 16, 80-96.

Henry, G. T., Fortner, C. K., & Thompson, C. L. (2010). Targeted funding for educationally

disadvantaged students: A regression discontinuity estimate of the impact on high

school student achievement. Educational Evaluation and Policy Analysis, 32, 183-

204.

Hillman, N. W., Tandberg, D. A., & Fryar, A. H. (2015). Evaluating the impacts of “new”

performance funding higher education. Educational Evaluation and Policy Analysis,

37, 501-519.

Johnson, R., B., & Christensen, L., (2014). Educational Research: Quantitative, Qualitative,

and Mixed Approaches (5th ed), Thousand Oaks, CA: Sage Publications.

Jones, W. A., & Braxton, J. M. (2009). Cataloging and comparing institutional efforts to

increase student retention rates. Journal of College Student Retention: Research,

Theory, and Practice, 11, 123-129.

Lang, M. (2001). Student retention in higher education: Some conceptual and

programmatic perspectives. Journal of College Student Retention: Research, Theory,

and Practice, 3, 217-229.

UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 14

McLaughlin, G. W., Brozovsky, P. V., & McLaughlin, J. S. (1998). Changing perspectives on

student retention: A role for institutional research. Research in Higher Education, 39,

1-17.

Padilla, R. (1999). College student retention. Journal of College Student Retention: Research,

Theory, and Practice, 1, 131-145.

Roberts, J., & Styron, Jr., R. (2010). Student satisfaction and persistence: Factors vital to

student retention. Research in Higher Education Journal, 6, 1-18.

Smith, J. K., & Smith, N. L. (1985). Budget allocation patterns in educational evaluations.

Evaluation Review, 9, 681-699.

Thomas, L. (2002). Student retention in higher education: The role of institutional habitus.

Journal of Educational Policy, 17, 423-442.

Tomkinson, B., Warner, R., & Renfrew, A. (2002). Developing a strategy for college student

retention. Journal of Electrical Engineering Education, 39, 210-218.

Yorke, M., & Longden, B. (2004). Retention and student success in higher education.

Berkshire, England: McGraw-Hill

UNIVERSITY BUDGET ALLOCATION AND STUDENT RETENTION 15

Items Possible points Score

Clearly state the background and purpose of the study 3
Clearly define key terms/important variables 2
Able to identify the gap in the literature/show the 3
importance of the research)
Good connection between previous studies and the 3
proposed research question
Design of the study (Method) is workable/practical 3
Well-organized proposal 2
Use of proper grammar; free of typos 2
Clear attempt to use APA style fully in headings and 2
citations
TOTAL 20 points