A recent report by the College Board highlights the dramatic increase in tuition and fees at colleges and universities over the past decade. From 1993 to 2003, annual tuition and fees at public 4-year institutions increased by 47 percent – or roughly $1500 per student – even after adjusting for inflation.
A closer examination of the data reveals that over two-thirds of the increase in tuition and fees during the last decade has taken place in just the last three years. When room and board are added in, nearly two-thirds of the roughly $2800 increase per student has also occurred in the last three years.
This recent rapid increase in the college costs facing American families can be explained by the effects of the economic recession on state revenues, insufficient fiscal relief from the federal government, and the states’ general reluctance to raise taxes.
Moreover, federal Pell grants – which are designed to make higher education more affordable – have not kept pace with rising college costs. Pell grants on average cover only about 30 percent of total costs at public 4-year institutions. The average Pell grant increased by only 22 percent in real terms over the past ten years, while college costs rose more than twice as much. As college costs soared over the past three years, the average annual Pell grant increased by less than $300.
