One of the biggest financial strains for American families today is the cost of higher education. According to US News, the average annual cost for private colleges in 2021-2022 was $38,185. Multiplied by four years of schooling, the total cost becomes an astounding $152,740. The vast majority of Americans can not afford to pay hundreds of thousands of dollars out-of-pocket, which forces them to rely on part-time jobs, insufficient financial aid, and most of all, crippling student loans. However, unaffordable college tuition is a relatively recent development: since the 1980s, private tuition has risen by 129%, while public tuition has risen by 219%. So, how exactly did college become so expensive?
The answer is quite complex, involving high administrative costs, upgraded facilities, more financial aid available, and other factors. Perhaps the biggest reason costs have gone up is that demand for college is much higher: according to the US Department of Education, there were 5 million more college students in 2017 than in 2000. A college degree is perceived to be far more valuable now than in past generations; it is essentially the equivalent of a high school diploma in the modern workplace, and most middle-class jobs require at least a four-year degree. Students are also becoming more cognizant of the financial advantages to attending college: on average, individuals with college degrees earn about $22,000 more than those with just high school diplomas. So, many families opt to pay more for college if it may lead to more success and higher income down the road. Another factor to consider is that many students don’t pay the sticker price for college tuition. Generous financial aid has contributed to higher tuition costs, especially at private colleges. In 2020, the average annual cost of attendance at an Ivy League institution (without aid), was $78,417. However, after financial aid and scholarships, the cost of attendance was only $22,500. By charging higher full tuition to those who can afford it, universities are able to improve their institutions while also giving aid to those who need the financial support.
College in the United States is more expensive than virtually every other developed country, largely because American universities spend a lot more on their facilities. According to the Organization for Economic Cooperation and Development, colleges in the US spend about $30,165 per university student, much higher than the average cost in developed countries, which is $15,556. In an effort to attract more students, many American colleges are investing heavily in student services and nice-to-have amenities, rather than academic resources. As a result, college costs are pushing upwards for all students, many of whom would prefer lower college tuition over frivolous recreational facilities.
To make college costs more manageable for students, colleges should focus their spending on affordability and academics.
