Nationally, 7 in 10 graduating college seniors have student loan debt. This is up from only 5 in 10 indebted students in the mid 1990s. For the indebted, it averages close to 30,000 dollar per student. Student debt in aggregate, 1.2 trillion dollars, is second only to mortgage debt.
Breaking out the indebtedness, 66 percent of students attending public colleges and universities, 75 percent attending private non-profit institutions, and an astonishing 88 percent of students attending for profit institutions owe. Almost 9 in 10 students at for profit institutions carry a debt averaging 40,000 dollars. This is serious debt requiring the direction of 10 percent of a salary over 10 to 15 years for a school teacher, as just one example.
The cost of a college education has been rising faster than inflation and there are a couple of reasons for this. First, for public institutions, state funding as a percentage of the total cost of the education has been declining. Since the 1970s the share of the cost of an education has gone from well over half to much less than half, leaving tuition to make up the difference.
An additional burden on the cost of an education -the number of non-academic administrative and professional employees at U.S. colleges and universities has more than doubled in the last 25 years.
There are now about two non-academic staff per faculty member. Some of this is driven by the cost of regulations, and dealing with less than optimally prepared students. Ironically at least part of it is competition between institutions for students.
Athletics is also a drain on academics at all but the most successful schools. A local example is the fact that there is a athletic fee imbedded in the cost per credit hour at Arkansas Tech University: 14 out of 209 dollars per student credit hour goes to support the athletic program. Other fees exist but are identified as a line item. Would students on tight budgets really be interested in paying that fee were it voluntary?
These kinds of spiraling costs occur across the country. It’s just the price we have to pay for an educated citizenry, so be it. But does it have to be this way? Should higher education be in the entertainment business? Only seven programs at public institutions break even or better. For the University of Arkansas and almost every other university, sports is a money-losing proposition.
Now more than ever we are competing in a global economy and the country with the most educated citizenry should have a competitive advantage. In a number of European countries higher education is free for the citizens, but also free of entertainment programs such as athletics thus lowering the net cost.
You want a free college degree, at least tuition wise? Get over to Norway were they provide free higher education, even to non-citizens, just don’t expect to be rooting for the home team.