Wednesday, April 24, 2024

College tuition has outpaced inflation by more than 3x over the last 40 years

By Scott Winstead

In the 1982-83 school year, college tuition was just $3,200. If the cost of going to college rose consistently with the U.S. inflation rate over the last 40 years, students would be paying an average of $9,705 for a full year of attending a public university or $21,623 for a year at a private college. Instead, data from the nonprofit group College Board reveals the average annual price for attending a public college (tuition, fees, room & board, books/supplies) is currently between $23,250 for in-state students to $40,550 for out-of-state students. For students at private universities, the yearly cost has reached a jaw-dropping $53,430. In 1982, this was $7,130 per year.

The cost of college has increased by as much as 649% in some cases — over three times the rate of inflation during the last 40 years.

The 80s were a significant turning point. Between 1980 and 1990, the cost of going to college basically doubled — rising 141% for private universities and 99% for public colleges. The 1980s decade saw some of the biggest year-over-year tuition increases of any decade.

In 1986, William Bennett, the Secretary of Education, sounded the alarm on the rising costs of college, accusing institutions of “defrauding students [and] ripping off the American public” and warning that the fast-rising default rate on student loans was unsustainable.

 

(Ishan Shah / Unsplash)

Unfortunately, the trajectory of increasing tuition and fees that started four decades ago has continued to this day. Tuition prices have risen so much during that same 10-year period that total annual revenue for US colleges from tuition and fees actually increased by at least $6.9 billion.

As the cost of going to college has soared, many young adults have simply started to opt out of attending. We recently reported that enrollment across all two and four-year universities dropped by 3.1 million student from 2012 to 2022.

Students have started to explore alternatives to the traditional college education, turning instead to online course websites like Coursera, Udermy, Udacity, Linked Learning, and Skillshare, where they can take online certification courses from schools like Harvard and Yale at home and at a fraction of the price (or even free in some cases). Many of these online course sites like Coursera have reported huge increases in enrollments over the last couple of years.

Unfortunately, the trend of rising tuition costs and student debt for traditional college education shows no signs of reversing. Today, the average college graduate leaves school with about $31,000 in student loan debt they’ll have to pay back. The latest data shows that U.S. student loan debt totals about $1.76 trillion.

During this prolonged time of astronomic spikes in tuition and fees, it’s no longer realistic for students to work their way through college unless wages increase significantly.
Eventually, something has to give. The future of higher education might depend on it.

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