At What Rate is College Tuition Rising?
Why are college costs rising so much faster than other expenses such as medical costs and the general inflation index? Just how fast are college tuition costs rising when compared to medical expenses and general living costs? According to an article published in the Wall Street Journal (WSJ) on Thursday, the 3rd of January 2013, the change in tuition costs across the United States has been 92 percent from 2001 to 2011, while medical care costs have increased 47 percent during the same period and the consumer price index has increased by 27 percent.
Paying for Tuition with a Part-Time Job is a Thing of the Past
Consider this statistic mentioned in the WSJ article: “In 1975, a University of Minnesota undergraduate could cover tuition by working six hours a week year-round at a minimum-wage job…. Today a student would have to work 32 hours (a week) at minimum wage to cover the cost.” As it is not feasible to expect students to work so much while attending college full time, that means scholarships, college grants, and student loans are filling in the gap to help students pay for college. Get yourself up to date with the latest regarding 2014 college grants.
How Come College Tuition Keeps Going Up So Quickly?
One reason that college tuition is increasing considerably more than the inflation index, is that universities across the United States have taken on too many costs by hiring too many administrators. There has been something a of a spending spree over the past years, with many new administrative positions being added to the staff of colleges and universities. Some university administrators earn more than $200,000 per year, with some university presidents earning beyond $500,000 per year, so it is easy to see how a significant portion of a college or university budget can be siphoned into supporting high administrative costs.
Another reason that college tuition is rising faster than the pace of inflation is that schools keep trying to offer the most up-to-date equipment, amenities, and facilities to attract students. This means that many colleges and universities take on debt for construction projects. The cost of servicing debt associated with these projects is also a significant part of a college or university’s annual budgeted expenses.
In addition, many colleges and universities have expensive bureaucratic procedures. For example, it might cost $75 in labour costs to process a reimbursable expense valued at $12.
To see WSJ articles regarding universities’ administrative costs click the link WSJ.com/PriceOfAdmission