Tuition at college and graduate school after scholarships and grants are factored in rose 1.9 percent in the year through June, in line with overall inflation, Labor Department figures show. By contrast, from 1990 through last year, tuition grew an average 6 percent a year, or more than double the rate of inflation, reports The Wall Street Journal.
In that time, the Journal writes, the average annual cost for a four-year private college, including living expenses, rose 161 percent to about $27,500, according to the College Board. As a result, some schools are cutting prices and offering more discounts.
The Journal cited a number of factors propelling the trend.
“Abundant supply is running up against demand constraints,” the Journal reported. “The number of two-year and four-year colleges increased 33 percent between 1990 and 2012 to 4,726, Education Department data show. But college enrollment is down more than 4 percent from a peak in 2010, partly because a healthy job market means fewer people are going back to school to learn new skills.
“Longer-running economic and demographic shifts also are at play. Lower birthrates and the aging of baby boomer children have reduced the pool of traditional college-age Americans. The number of new high-school graduates grew 18 percent between 2000 and 2010 but only 2 percent in the first seven years of this decade, Education Department data show.
“Another factor: Congress last increased the maximum amount undergraduates could borrow from the government in 2008. Some economists have concluded schools raise prices along with increases in federal financial aid. A clampdown on aid, in turn, could limit the ability of schools to charge more.”
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Frank Kalman is Talent Economy‘s managing editor. To comment, email email@example.com.