In the world of consumerism, we traditionally abide by the simple rule of supply and demand. The number of vehicles automotive companies built in recent years has declined because of microchip shortages and shipping delays exacerbated by the pandemic. Thus, as the supply of cars and trucks shrunk, their respective prices increased in lockstep with demand.
It’s a basic economic rule that impacts the cost of everything. Well, almost everything. The cost of higher education across the country continues to defy this equation. While the number of undergraduate students has plummeted, the cost of earning a degree has sky-rocketed faster than inflation.
This trend only accelerated after COVID-19 swept the country and forced many students into remote learning. Since 2020, the undergraduate student body nationwide has decreased by 9.4%, or nearly 1.4 million students, according to the National Student Clearinghouse Research Center. And public institutions are suffering the greatest declines.
Meanwhile, the cost of going to college has exploded. Tuition, room and board to attend a four-year private institution during the 2021-2022 school year cost $55,800 on average. A four-year, in-state public college cost $27,330 a year, according to the College Board.
Part of the increase can be attributed to less state and federal funding, but some of the nation’s colleges are passing along the cost of shrinking student bodies by raising tuitions and fees. That means access to higher learning is only becoming more unattainable, especially for low- and middle-income students. Subsequently, colleges have begun closing across the country.
Lincoln College in Lincoln, Illinois, recently shuttered after 157 years. The San Francisco Art Institute closed after 150 years. In fact, The Wall Street Journal reported that the number colleges shutting down over the last 10 years was four times as many as the previous decade. So, the cost of a degree continues to get more expensive even as more high school students question whether earning one is worth it.
In Montana, our two large universities have been trending in different directions for the last decade. The University of Montana in Missoula has seen its undergraduate class shrink by more than 40%, which the Chronicle of Higher Education reported in 2019 was the largest decline in students among public flagship universities. UM enrollment has stabilized in recent years, while Montana State University – in the more affluent town of Bozeman – has seen its headcount dramatically increase.
MSU is now a destination school in a destination town. It is among the public and private colleges where the dwindling number of U.S. college students has had little impact. While dozens of colleges across the country are facing a financial crisis, forcing them to close or declare bankruptcy, the most sought-after institutions are faring better than ever and drawing a record number of applications.
To be sure, not everyone should attend college. Many who don’t will earn a better living than those with degrees. But it’s still surprising, in this world of supply and demand, that nearly every college in the country is further raising its prices when fewer people want their product. What would happen if they scaled down what they offered and became more affordable? What if a few of them went on sale and more students with more modest means could afford them?
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