On Past and Future Tuition Increases
October 8, 2008
by Emily While a report released Tuesday by the Department of Education shows relatively low rates of tuition increase over the last two years, other data and expert opinions suggest that the same will not hold true next year. Between the 2005-2006 and 2007-2008 academic years, tuition at four-year public and private colleges for in-state and out-of-state undergraduate students showed increases of 3.4 to 6.7 percent, adjusted for inflation.
Out-of-state tuition at public state universities stayed relatively low, increasing 3.4 percent to $13,630. In-state tuition at public universities went up 5.3 percent over two years to $5,749. Non-profit private universities saw a 6.7 percent tuition increase, bringing the total amount of tuition and fees to $19,337, while for-profit private universities increased tuition 5.2 percent to $14,782.
However, the economic downturn of 2008 is likely to spur much larger tuition increases as states lose tax revenue. A report from the Nelson A. Rockefeller Institute of Government warns that state tax collections may fall sharply this year, with revenues from sales taxes, corporate income taxes, and fuel taxes already falling in the second quarter of 2008. Some states are already cutting budgets to deal with potential revenue shortfalls and increasing inflation, and the trend is likely to spread.
This could hurt higher education funding and force universities to increase tuition, especially since they also must contend with inflation, with providing financial aid to students in tougher financial situations, and with other potential drops in funding caused by the credit crunch. Announcements of tuition increases likely won't happen for months, but for high school seniors and other students in the process of choosing a college, potential tuition hikes are definitely something to keep in mind during the college application process.