Informed consumers put pressure on rising college costs

by Grace

For the first time in years, the rise in tuition at many colleges is expected to be below the rate of inflation.

Today’s college students are more aware and informed about rising costs and financial aid, and more sensitive to price. That’s going to put ongoing pressure on the whole higher education industry’s finances, according to a Moody’s report (paywall) which gave a gloomy outlook for the whole sector.

A severe version of this is putting major pressure on US law schools, which are actively competing on tuition (paywall) for students, slashing faculty, or closing altogether. Since the 1970s, US tuition costs for undergraduate and graduate degrees have climbed to historic highs. But tuition hikes have slowed substantially as the number of schools have grown, spurring more competition.

This year, a far greater number of the graduate and undergraduate schools Moody’s surveyed projected under 2% tuition growth, a fraction of what we’ve seen for years, and below the cost of inflation:

20141214.COCDecliningTuitionIncreases1

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Max Nisen, ” People are getting smarter about college costs and it’s squeezing the whole industry”, Quartz, December 4, 2014.

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2 Comments to “Informed consumers put pressure on rising college costs”

  1. I just read that enrollment at law schools has dropped by 30 percent since 2009. Yikes! I have always wondered, though, about the law school model. Even back in the 90’s, I used to think it was a bad value for most students. I had known several people who had gone to low ranked law schools and couldn’t find good paying jobs when they graduated.

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  2. “Even back in the 90’s, I used to think it was a bad value for most students. I had known several people who had gone to low ranked law schools and couldn’t find good paying jobs when they graduated.”

    If it was bad then, it’s horrible now.

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