Inflation

Nearly Half of US Colleges Don't Get Enough Tuition Revenue to Keep Up with Inflation

Universities are heading underwater

|

Nearly half of the nation's colleges and universities are no longer generating enough tuition revenue to keep pace with inflation, highlighting the acceleration of a downward spiral that began as the recession ended, according to a new survey by Moody's Investors Service.

The survey of nearly 300 schools reflects a cycle of disinvestment and falling enrollment that places a growing number at risk. While schools for two decades were seeing rising enrollments and routine increases of 5% to 8% in net tuition, many now are facing grimmer prospects: a shrinking pool of high-school graduates, depressed family incomes and precarious job prospects after college.

Advertisement

NEXT: LG Admits Smart TVs Spied on Users

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  1. That is poetic justice, given that all those colleges are filled with economic witch doctors telling students that money printing is the key to prosperity.

  2. Government needs to do something about this!

  3. Having a hard time finding my worried face.
    Seems cutting some costs and maybe offering classes with a good chance of gainful employment might help; let ’em compete for the tuition and the good ones will do just fine.

  4. The problem is not a revenue shortfall, but exploding costs. Since 1980 or so, universities have hired an enormous number of nonacademic staff. Universities do all sorts of things that are quite peripheral to their teaching and research mission. Professors should be paid by the course. Research pay in excess of 30K/year should be funded by external grants.

    The OECD nations need to rethink their grim pursuit of having 30-40% of an age cohort complete some sort of degree. What we need is more community colleges offering technical education leading to a trade.

  5. someone should do a story about the waste in college. It seems that each professor have their own secretary who does very little except to photo copy paper.

  6. problem is that the administrators and professors have given themselves enormous pay and benefit raises much higher than the rest of society. This is counter to the rules of economics. Tuition has gone up tremendously on the backs of the students who have taken out extravagant loans to pay for education. This completely untenable situation is starting to crash down.

Please to post comments

Comments are closed.