Two Charts That Show Exactly Why College Is Getting More Expensive
The cost of a college degree rose to record levels in 2012 –– a staggering 8.3 percent increase from $4,793/year to $5,189/year at public universities.
That exceeds the average 5 percent jumps that occurred over the last three years.
Why the sudden jump?
According to a report released today by the State Higher Education Executive Officers, blame it on dwindling state bank accounts.
State and local support for higher education dropped by 7 percent nationwide, totaling $81.2 billion. The number, adjusted for inflation, marks a 25-year low in state and local higher education funding and translates to a 9 percent decline in funding per full-time equivalent student, according to the report.
From 2009 to 2011, many states relied on funds from the federal American Recovery and Reinvestment Act to help offset costs. But that money dried up last year, and states and local governments were left to foot their part of the bill on their own –– forcing many to cut their budgets and drive up tuition costs.
Today, public colleges use tuition as 43 percent of their revenue stream. See how much their budgets have changed in just a year in the two charts below.
2011
State Higher Education Executive Officers
And here's how revenue looked in 2012 (Note: The blue sliver is gone.)
State Higher Education Executive Officers
The short-term impact of higher tuition: Fewer college students and ballooning student loan debt.
As tuition costs have increased, it only makes sense that student loan debt has grown as well. In the last eight years, our federal student debt load tripled to more $966 billion, according to a recent report by the NY Fed.
That increase occurred even as fewer students were enrolling in public universities. Full-time student enrollment dropped by 0.7 percent across the country in 2012, falling from record-high enrollments in 2011. The largest drop in enrollments was in California, which the report attributed to rising tuition costs and enrollment caps caused by decreasing state funding.
College enrollment has typically increased during recessions. Despite last year's drop, 28 percent more students have enrolled at universities since 2002.