Although a college education is an increasingly important tool in today's competitive labor market, soaring education cost have put it out of reach for some. In "Cap in Hand: The High Price of Higher Education," EconSouth staff writer Ed English explores the factors behind rising tuition costs.
In the decade from the 2000–01 academic year to the 2010–11 academic year, "tuition and fees at public four-year colleges and universities increased at an average rate of 5.6 percent per year above the rate of general inflation," notes English, quoting a recent study by the College Board Advocacy and Policy Center.
While prices for most goods eventually reach a tipping point where demand falls, this threshold has yet to be breached for higher education, he says. Between the 1999–2000 and 2008–09 school years, the number of full- and part-time students rose 25 percent. Not surprisingly, this increase was accompanied by a rise in the number of Americans with four-year college degrees.
However, students are taking on more debt to achieve their higher education goals. In August 2010, the Wall Street Journal reported that for the first time ever, Americans owed more on student loans than revolving credit. Southeastern college seniors are in a slightly better position than those in other regions, notes English. According to data from the Project on Student Debt, graduating college seniors in all but one southeastern state fared better in terms of debt levels than the national average.
So is further education worth the additional debt? asks English. In most cases, yes, he concludes. Importantly, statistics show a clear benefit: "more education, more income." However, despite the obvious pluses of a college education, not everyone will need one. Pointing to data from the Bureau of Labor Statistics, he notes that only seven of the fastest growing 30 jobs over the next ten years will require a college degree.
While tuition rate increases will likely outpace the rate of overall inflation for some time, "college students of the future can expect an evolving educational environment," he writes, noting factors such as the mix of schools and the increase in technology and distance learning.
Read the full article, featured in the first-quarter issue of EconSouth, available in print or online, to learn more about the rising cost of education.