Why Is College So Expensive?
A college degree allows workers in many fields to command more money — provided they’re able to get a job. In an economy where that’s still far from a sure thing, how can universities justify charging ever-higher amounts for tuition and fees? In part, it’s because they have to.
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“After more than a decade of robust growth, tuition revenue is expected to decline at 28 percent at public universities and 19 percent at private universities in 2014, according to a report released last month by credit rating agency Moody’s Investors Service,” reports Nin-Hai Tseng at CNNMoney. “In a survey of about 300 U.S. schools, nearly 30 percent of public university respondents said that they expect tuition revenue to decline in fiscal years 2013 and 2014. What’s more, 44 percent of public universities do not expect the growth of tuition revenue to keep up with inflation, or 2 percent, in fiscal year 2014.”
Why are tuition revenues declining? In part, it’s because fewer people are choosing to hide out from a bad economy by going to school. Tseng also mentions that going to school out of state is less appealing when the economy is still shaky and in-state tuition is so much cheaper.
Even adjusted for inflation, tuition and fees at private universities increased 14 percent from 2008 to 2013, according to The College Board, while expenses increased 27 percent at public schools. Those rates have slowed over the past two years, but it’s still enough of an increase to make potential students think twice before enrolling.
What’s the answer? Well, college could become cheaper, either through better management or government intervention, but we’re not holding our breath. Until then, students’ best bet is to do their research, and pick both their majors and their schools with financial considerations at least partly in mind.
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