The rising cost of college threatens to put higher education out of reach for most Americans. College tuition and fees have increased 439% from 1982 to 2007 while the median family income rose by about 140% during the same period and these figures have not been adjusted for inflation. Student borrowing has more than doubled in the last decade. If the trend continues, it will not be long before we won’t have an affordable system of higher education. Since the early 1980’s, college prices have been rising steadily at two to three times the Consumer Price Index (CPI).
While tuition has risen at public universities, it is usually the result of declining State appropriations. State appropriations to public colleges declined nearly $4 billion dollars in 2008-2009 from the previous year, even as enrollments grew. Private colleges were forced to offer more financial aid even as their endowments fell by record amounts as the stock market melted down and philanthropy dried up.
In 1971, tuition, in constant dollars in the United States, was about $2,500. By 1981, that same tuition was just under $8,500. By 1991, the tuition had risen to around $11,000 and by the year 2001, the cost again went up to $13,000. To do a reality check, I went on line on found that for the 2011-2012 academic year, the cost at the University of Michigan for tuition & fees alone (in-State residents) was $11,837. If you add to this, $1,048 for books and supplies + $9,192 for room and board + $2,090 for personal & miscellaneous expenses, the total annual cost came out to $24,167!
Room and board is becoming a deciding factor in the choice of colleges for many students. Using Michigan as an example, Oakland University came in at $9,717 for the 2010-2011 academic year. Community colleges, home to about 40% of college students, have also been raising prices but appear to be the better overall bargain, at least for the first two years of college. Macomb Community College priced out about $2,500 for in-State tuition and fees and $4,870 for Out-of-State tuition and fees. Oakland Community College came in a little higher at $3,156 for In-State tuition & fees and $4,386 for Out-of-State students.
Borrowing for college is an option but one that has to be controlled or the average student graduating in the years to come will carry a significant financial burden during his or her working years. On average now, about two-thirds of the bachelor’s degree recipients borrow money and their median debt in about $20,000 by graduation. As one educator pointed out, “Any liberal arts degree – political science, history, English, teaching, you are heading into an already depressed job market at base salaries that just don’t pay enough.”
Every sector of the American economy is under stress right now and higher education is no exception. Many universities may have to explore a variety of approaches to lower costs – additional online courses, better use of the senior year in high school, perhaps even shortening college from four years. We know one thing for sure. We cannot go on raising tuition 7 to 10% each year and expect college to be affordable down the road.