The Cost of Higher Education
by Jennifer Sigler | September, 2017 | Workhappy Blog
Is higher ed in crisis mode: Analytics related to rising cost of tuition and the unequal rise in minimum wage point to “yes.”
A college degree is EXPENSIVE.
Sadly, a higher education is something only the most privileged in our country can afford without the help of scholarships or — even more likely — without student loans.
Just ask one of the 44 million borrowers who, collectively, owe more than $1.4 trillion in student loan debt. I don’t know about you, but that number makes my heart skip a beat. $1.4 trillion. This hits home especially hard because I am one of the 44 million borrowers.
To put it in perspective, this is approximately $620 billion more than the total U.S. credit card debt. Robert Manning tackles the growing debt problem in the United States in his book “Credit Card Nation: The Consequences of America’s Addiction to Credit,” and asserts that debt accumulation has significantly altered social practice.
Ease of Access
Credit is easy to access and allows consumers to purchase freely with very few barriers. Perhaps this is why the average American household has just shy of $17,000 in credit card debt.
The desire to live certain lifestyles, distinguish oneself, and create self-identity through consuming helps aid the continual use of credit, despite increasingly high debt burdens among the general population.
And one of these burdens, felt increasingly by younger generations, is figuring out how to pay for higher education — a feat that is impossible to do the way generations past have done.
Is Paying Back Debt Even Possible?
Three years ago, the Atlantic Monthly published a fantastic article demonstrating how it is not possible for current students to work their way through college in the same way as their predecessors because of the rising cost of tuition and the unequal rise in minimum wage.
Using Michigan State University as a measuring stick, Svati Kirsten Narula outlined the simple math:
- In 1979, when the minimum wage was $2.90, a hard-working student with a minimum-wage job could earn enough in one day (8.44 hours) to pay for one academic credit hour.
- If a standard course load for one semester consisted of maybe 12 credit hours, the semester’s tuition could be covered by just over two weeks of full-time minimum wage work—or a month of part-time work. A summer spent scooping ice cream or flipping burgers could pay for an MSU education.
- The cost of an MSU credit hour has multiplied since 1979. So has the federal minimum wage.
- Today, it takes 60 hours of minimum-wage work to pay off a single credit hour, which was priced at $428.75 for the fall semester.
All this, and we haven’t even covered the other essential costs students incur when attending college, such as room and board, student fees, and books.
Let’s also not pretend that colleges help everyone equally. In fact, some students are probably worse off for having attended a large university instead of a small regional school or community college.
Sociologists Elizabeth Armstrong and Laura Hamilton track the progress of 53 women through the college experience in their book, “Paying for the Party: How College Maintains Inequality.” They maintain that large state universities organize the college experience in ways that systematically disadvantage everyone but the most privileged students.
If you haven’t read this book, it needs to be put on your short list, stat. From their time conducting the study, they found that not one of the working-class girls on their floor graduated from the university within five years.
After College: What’s Next?
The crisis that is higher education in America is further complicated by the fact that earning a college degree does not guarantee a well-paying job right out of the gates — especially for graduates of the liberal arts.
Student loans combined with a competitive job market has also forced many college graduates back home with their parents, where their cost of living is low.
And so now we have an entire generation of people living in their parent’s basements, revising their resumes and searching for jobs, wondering just how they are going to pay back their student loans quickly.
Given the figures I outlined earlier, it comes as no surprise that this feels like an insurmountable task.
The ripples of this massive student loan debt are also beginning to be noticed throughout social and economic patterns. Young adults are waiting longer and longer to marry, and cohabitation is on the rise.
While marriage and cohabitation are comparable in practice, cohabitation has many advantages for the financially burdened — namely, allowing for cost sharing without the legal ramifications of marriage.
And yet a higher education is still highly valued in our society as a whole and the job market specifically. A survey conducted by New America, a Washington D.C.-based think tank, reports that 75 percent of respondents feel that it is easier to be successful with a degree than without one.
The data tends to agree with this consensus, showing that college graduates are still better off financially than those who hold only a high school diploma. This is, in part, due to the growing “credentialism” many professions practice — that is, looking for higher qualifications than a position actually requires.
ROI on the Decline?
Here’s the bottom line: College graduates are beginning their careers with an unprecedented financial burden, meaning that having a college degree in hand doesn’t guarantee a seat on the upward mobility train in the same way it once did.
A person can spend money on 4-6 years of higher education (no doubt, a quality education) and then spend a good portion of their life paying for it — with interest.
We appreciate the value of a higher education, but as our ROI gets harder and harder to see, this may not hold true for much longer.
Jennifer Sigler is a Senior Writer with The UpWrite Group. Send a message to services@TheUpWriteGroup.com to see how she can help enhance your corporate or personal brand.