The fall season for those with teenagers exploring college options can be one filled with anxiety and uncertainty in more stable times. This is anything but a stable time. We have college tuition spiraling out of control for well over two decades while a pandemic forced students to learn online away from carefully manicured campuses. How do you decide on which college to attend if you are unable to visit the campus, explore the classes, or experience what has been so painstakingly packaged to embody the college going years? That is the question millions of families are grappling with in the middle of all the other questions the novel coronavirus has tossed at us. Colleges are having to face an existential challenge in what they truly believe in – do they want to educate our future or serve only as a finishing school for the affluent in our society?
The Student Debt Crisis
Here is a sobering number for you: $1.64 trillion. That is the amount of student debt floating in our economy. And this number continues to grow on a slow pace of unavoidable expansion. Many parents with K-12 aged kids went to college at record levels. With the world seeming so unstable, people are seeking to replicate some form of clarity. College seems to be the end work of raising “good” kids and reflecting a training ground for future success. But that is not always the case.
44 million Americans carry student debt. And many are unable to purchase homes, save for retirement, or purchase other goods because of the debt they carry once they graduate.
Is College Worth It?
This question is an important one. It should be noted that many people get into affordable state schools and go on to be highly successful. Yet there is an obsession in our society that only the elite colleges matter. Yet the truth of the matter is many of these schools do not offer anything dramatically different from other colleges aside from the elite access to their talent within the walls they conduct class. The actual knowledge and educating is largely ubiquitous today now with online content. The knowledge is out there. The campus experience and the credential seems critical to the price tag of a college degree.
Yet this messaging doesn’t really work beyond the top 100 or so elite colleges in this country. Yet the other 4,000 colleges utilize this messaging to justify their tuition. Many have built up fancy dining halls, spacious gyms, and other amenities that typically would go with resort living. But in a time of a pandemic, many students are enjoying none of this while taking classes over Zoom. The question of prices certainly comes up.
College does have a positive return on investment. But like any complicated topic, the devil is in the details. You have many Americans pursuing degrees in fields of study with little demand in the workforce. There is a reason that engineers make more than those with a history degree. So how do you assign value to a degree that can change your life?
It is important to separate cost and value. You can measure the worth of college based on cost because someone has to pay for it. The value side of the equation is more subjective and difficult to measure. But cost is clear. You have many private 4-year institutions charging $50,000 a year or more simply to attend. This is hard to comprehend when the typical American households makes a bit more than $50,000 per year to sustain all the mouths under that roof. There are more affordable options like community college and local state schools.
People need to explore deeper here because many colleges will offer a good education at a good price but if you go chasing a school simply because of a shiny title, you may be in deep debt before you know it.
What Next?
Before the pandemic hit colleges were already slowly adjusting to the reality that tuition inflation could not stay the course forever. Many schools were already seeing enrollment challenges. And then the pandemic hit. Colleges budgets were crushed. Students moved out of dorms. All classes went online. And like most of America, many college campuses became ghost towns.
Is it worth the cost to attend a virtual ghost town? Our society still places value on the credentials from schools, especially top schools so many are working through the pandemic environment because they know that the degree is going to carry weight when they graduate. Colleges understand this and that is why tuition is so high. Yet the cost is only supported by the debt keeping it afloat which is easy to get.
Colleges have many big questions to answer in the next few years. Covid-19 simply accelerated the inevitable and now universities need to confront their biggest anxiety – what are they really worth?
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