After a bleak period in which college costs seemed only to rise, US students may be getting some relief: they appear to be paying less, with the institutions themselves increasingly absorbing the difference.
The average listed price of a four-year college degree and the average price that students actually pay after grants and other discounts are slightly lower in the current academic year – in inflation-adjusted dollars – than they were a year ago, the College Board said in an annual report.
The average total published cost of tuition, other fees, room and board is $21,370 (£16,263) this year, compared with $21,400 last year, while the average amount actually paid by students this year is $14,880, compared with $14,910 last year, the College Board said.
One big factor was that colleges and universities spent $60 billion on grant aid for undergraduate and postgraduate students in 2017-18, up 24 per cent in inflation-adjusted terms from five years earlier. Grant aid from states, employers and other private sources rose by almost 10 per cent over those five years, while federal grant aid fell by 12 per cent, the report said.
The numbers suggest some easing of the student debt crisis from the point of view of the students, said a co-author of the College Board report, Sandy Baum, a fellow in the Education Policy Program at the Urban Institute.
While shrinking costs will be welcomed by students and parents, they could well take a toll on the quality of education provided, and it’s not clear how long colleges can sustain them, Dr Baum said.
“They’re not paying their faculty as much, they’re deferring maintenance, they’re cutting expenses, you can cut class offerings, you can make classes bigger – there are lots of things you can do,” she said of US colleges. “Some of them may harm the educational experience.”
The increase in institutional grant aid also reflects competition among universities for students of moderate or high family wealth, for whom a discount can make the difference in the student’s choice of institution, Dr Baum said. For the institution, she said, the discounts could mean landing students who can still pay a sizeable share of their educational costs.
Some of that institutional aid may be attributed officially to student test scores or high school grades, Dr Baum said. But some level of discount has now become commonplace. “I think it’s called ‘merit aid’”, she said, “because it makes people feel good.”
Even with the one-year decline, the total average cost figure represents an 8 per cent increase from five years earlier, while the net cost paid by students was 9 per cent higher.
“That’s good news,” Dr Baum said of this year’s slight easing of prices. “But people are borrowing a lot, and prices are outpacing income, so that’s an ongoing problem.”
