Could College Be Cheaper?

Like Fontana Labs, I’ve long fretted that some day, all at once, in a tipping point reaction, both employers and families are going to decide in two different directions that expensive college degrees no longer predict success strongly and are not worth pursuing regardless of whatever usefulness they may or may not have.

There are reasons why that might not happen. For one, I think many colleges and universities are educating their students productively. The sky might not be falling so much as some people think it is. For another, the more highly selective a college or university is in its admission policies, the more useful it is for an employer as a device for identifying potentially valuable employees, even if the employer doesn’t know or care what happened to the potential employee while he or she was a student. If so, this has bad implications for expensive noncompetitive lower-tier private colleges, possibly, but since they’ve long since been the most economically tenuous part of the higher education sector, that’s not news. Also, it’s fairly hard to imagine what employers with relatively high turnover and thus a need for constantly refreshing their supply of lower-management employees would do to process their applicant pools if they didn’t have a B.A. degree as a basic screening device. Finally, the fact that public schools are becoming much more expensive in a way benefits the entire higher education sector in terms of its ability to sustain high prices for the long-term future. It used to be that you could get an education at some of the major public universities that rivalled most major private universities and at a much cheaper price. That’s increasingly no longer the case, so anybody who is fed up with the cost really has nowhere to turn besides not doing it at all.

Let’s suppose, however, that there is a tipping point out there somewhere, that higher education is moving towards a collective calamity in its pricing. What would it take for colleges and universities to start reducing their costs and lowering the price? For one, many institutions would have to do it at the same time. That’s because lowering the price is going to involve shucking off at least some of the product being made available. Doing that unilaterally is likely to be suicidal, especially among the top-end institutions. How to coordinate that movement without running afoul of antitrust collusion is a big issue in its own right.

The important thing is that parents and other observers have to understand that the high cost is in fact buying a wide range of services. Anybody who thinks you can shave the cost appreciably with little gestures of economy doesn’t understand the basic structure of academic budgets. Moreover, some of the most powerful external costs driving up academic budgets cannot be affected appreciably by colleges and universities acting on their own, but only by some larger public policy. Insurance, for example, or the costs of health care. The only thing universities could do on either of those is reduce the amount of insurance they carry or their benefits, and in many cases, those benefits already compare unfavorably to both the private sector and even to other non-profits. In other cases, costs could be controlled by universities, for example, in libraries, but only by changing the nature of academic publishing and academic credentialling, which will require faculties to participate in major reform initiatives.

What could a given university do that would not require collective action of this kind? Here I’ll cannibalize some of my observations from 21st Century College. A college or university could stop providing services of various kinds. For example, no health care for undergraduates. No counseling or help with student life issues. No athletic facilities or student life facilities. Minimalist classrooms, with minimal technological support save that which is paid for by external grants or support. Subcontract out all food services and other amenities to the highest bidders; manage nothing of this kind directly. Shed any services which do not relate to core instruction. Build only when buildings are about to literally fall apart; build nothing else unless it is completely paid for by external funding including a maintenance endowment.

You could radically intervene in the curriculum to throw overboard areas which do not pay for themselves through external grants, or which have low enrollments. You could make extensive use of adjunct or contract faculty (an already preferred solution, and thus unlikely to produce even more extensive savings.)

In fact, quite a bit of this on the curricular side is already being done at many institutions, and is the source of some complaints about the “corporatization” of universities. On the services side, however, there is largely still only growth and expansion. However, that’s in substantial measure because that’s what the paying customers want. A cheaper university sounds great until you add that it would also be a no-frills university with virtually no services, and then I suspect quite a few parents and students might feel differently. Moreover, such a university would undoubtedly be massively exposed to liability as well as discord: many of the services added in the last fifteen years are direct responses to lawsuits or agitation by students and other constituents.

The cost of higher education worries me enormously. It appears unsustainable as well as unjust. It is aggravating a problem that is somewhat separate in its causal underpinnings, the increasing degree to which universities are exacerbating the reduction of economic and social mobility in the United States. But I’m not sure what to do about it. I think at the least that some of the people most aggravated about it are going to need to get real about what it is that they’re asking for: curricula that are pared down radically to what external funders judge valuable and thus heavily biased to technical subjects with immediate professional payoffs, and institutions with few if any meaningful services beyond education. It would be interesting, at any rate, to see an institution of higher learning built on those principles start up in this marketplace, at least one that wasn’t built around online education, and see how it fares (and just how low it could get tuition).

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18 Responses to Could College Be Cheaper?

  1. isorkin1 says:

    Two minor quibbles: Swarthmore doesn’t provide health insurance for students.

    Students are required to have outside health insurance coverage. During the academic year, the College provides a nominal insurance coverage for all students to supplement their individual insurance. If you have no family insurance or if you have an HMO plan that has no local office, you must purchase individual health insurance that extends throughout the academic year. The insurance leaflet outlines an Optional Major Medical Benefit also available to students. Any student may extend the coverage for the three summer months for an additional premium. During the academic year, part-time students and seniors completing their graduation requirements but not enrolled may pay for health coverage at the Bursar’s Office.

    And some schools don’t do food in-house. Columbia doesn’t (there was some controversy because the corporation doing it also provided food in prisons…).

    More broadly, what happens to higher education depends what happens in the economy. Some predict that service work will continue to grow as a proportion; hence, skilled labor will become a better job and you’d expect more people to do vocational degrees. But for paper pushing jobs and the like, which will always exist, it is really hard to imagine a signalling device as effective as higher education arising [there was a wonderful econ. department t-shirt a few years back: I majored in econ. and all I got was this signalling device]. It won’t be a true crisis. You’ll see a decreasing percentage of people attending school, but there will always be enough jobs that require the writing and analytical skills that colleges select for that there will always be enough warm and qualified bodies for the upper-chunk of higher ed.

    The lower-chunk, however…

  2. Timothy Burke says:

    Sure, I’m not talking entirely about Swarthmore here, re: health insurance. But when I’m talking about frills, I mean getting rid of a campus health center like Worth.

    In any event, it’s not really about Swarthmore either in the crisis sense. The top-tier colleges and universities are in many ways substantially invulnerable even if the middle class comes to the conclusion that the high ticket prices don’t produce concomitant results.

  3. eb says:

    The current New York Review of Books has an article by Andrew Hacker touching on this and other questions related to college education. This passage is particularly troubling for advocates of the humanities (the quotation is part of a discussion of University, Inc:

    For example, she says that the embrace of business practices is “also changing what is being taught,” citing a state university where unprofitable “degree programs in classics, German, French, and several other humanities departments were eliminated.” Subjects like these, its president told her, are “stuff that you don’t need.” At first hearing, this sounds shocking. In fairness, the book might have noted that faculty members in these fields continue to teach; indeed George Mason University continues to list ninety-two courses in these fields, including “The Age of Goethe,” “Medieval French Literature,” and “Greek and Roman Comedy.” At the same time, she might have asked why, with an enrollment of 17,102, so few had chosen to major in the humanities. The standard answer is that students now want practical credentials, like degrees in business or computer science. Yet it is also possible that not enough professors tried to make their subjects interesting to a broader range of students. This can be done without betraying scholarly standards, or inflating grades, or resorting to showmanship. What is wanted is a serious commitment to undergraduate teaching, a trait not commonly found at research universities and those aspiring to that status.

    One of the possible reforms that emerges from Hacker’s article is that of separating undergraduate teaching from research, a process that would create a kind of minimalist college quite unlike the one you propose, but probably just as controversial.

  4. David Chudzicki says:

    About “changing the nature of academic publishing and academic accrediting”: The first one is saving money with open access journals, right? But what do you mean about changing accrediting structures? I’m sure you must have said something about this elsewhere on the blog, but I can’t really place it right now.

    About services: For most of these are services, we couldn’t really live without getting them from somewhere. And a solution that shifts us from paying the university for them to paying someone else for them isn’t too appealing, unless the idea is that we could get by paying less to other providers*. Intuitively, I make the uninformed guess that customers would end up paying about the same on average, but that we’re giving people choice that introduces more variation. Is this why getting rid of the services could be an improvement?

    About what’s just: Maybe I’m getting the wrong impression in our little bubble, but it seems like at the most selective schools, admission is generally need-blind, and anyone who’s admitted gets sufficient financial aid. So, is the point about justice more related to the “lower-chunk” private schools, where some people can afford to purchase the signaling device and others can’t? If so, I guess that’s even more evidence about these schools’ dubious status.

    About services and what’s just: Restricting our attention to the “upper chunk,” it seems like having the school provide these is really what’s most in line with our conception of fairness. This way, all of the students who get into our school are, in some sense anyway, on “equal footing” as far as our health care, food, housing, etc. Especially with respect to those services which customers can “almost” do without (good meals, counseling, other non-essential but important health services…).

    I do really like your 21st Century College, but the services thing is a bit hard to swallow. As I’m sure you know, it’s just so nice having these four years to be “taken care of” by the school. Maybe that lack of responsibility for real-world does negatively influence us somehow (but maybe it’s okay as long as we’re conscious of what a luxury this is?). It’s so good being able to just focus on intellectual/”personal” development during this time. And I personally think the benefit of the college shaping communal settings like dorms is vastly outweighed by the “nanny” problems that (can) result. And I’m still not convinced that you can actually save students money overall by not being a full-service institution. I would love to see this put into action, though.

    About corporatization of the curriculum: I used to be really cynical about this, but this semester I’ve been meeting people whose existence leads me think it could be okay. One member of the math department often has examples of how deep, “theoretical” ideas (the sort you wouldn’t really expect to be useful) turned out to be important when he was working in industry. The other is Robert Root-Bernstein, who gave a philosophy/sociology of science lecture last month. I don’t believe everyone is like this, but it gives me hope that some relationship between what’s practical and what’s academically interesting is at least possible.

    *Incidentally, I did save a little money living off-campus for a semester (mostly from the meal plan, the cost of which I really don’t understand).

  5. savitri says:

    I know your last sentence rules out distance learning institutions (even those with some bricks-and-mortar presence), but to some extent they do seem to be trying out the streamlined services educational model you have limned. Their for-profit nature also seems to enhance their ultimate low cost appeal (although to date I believe they are still, perhaps surprisingly, as costly as many traditional educations); and eventually, I think, they will likely offer a tempting package to “value-oriented customers”. Do you think they stand a chance? Or do you think they might have some kind of promising future, if they mutate into more educationally sound programs? (or what if a traditional institution experiments along these lines, but manages somehow to retain its quality of education, while framing its program in a new kind of hybrid online/on campus model?)

    I absolutely think agree that “expensive noncompetitive lower-tier private colleges” are even more at risk of being eliminated than they ever were. But I also think that their *public* counterparts are risky propositions: those students who want to stay in-state, but don’t want to (or of course can’t) pay their skyrocketing tuitions (without the offset of generous financial aid, as afforded by the wealthier/elite schools) will, eventually, defect to the next cheapest alternative. It’ll be interesting to see if the defection happens in small waves or in a tsunami, though.

    I guess I am also mixed about how much research these lower-tier schools can, and frankly should, support. For instance, even some of the lowest ranking schools here in the Boston area have an incredibly rich roster of talented faculty, many of whom are dazzling researchers but not exactly teachers committed to work in the daily (undergrad) trenches. They are costly, from an institutional viewpoint – but prestigious, I’m sure. Still, can these schools assume that keeping competitive, top notch research is an ideal priority? (of course, one could also ask, do they need to keep building beautiful dorms downtown, in the most expensive real estate north of NYC?) Are these schools doing the math?

    I do wonder whether parents and students truly want “practical” undergrad degrees (computer science, business, etc.) – and if so, why. I mean, is it because we haven’t done a great job in illuminating the value(s) of a liberal arts/humanities education? Would it help if we could draw clearer lines connecting a traditional education and its professional payoff (“if you can write a clear essay, you can and will write an impressive memo for your boss”)? On the flip side, could we make the less painful aspects of the “corporatization” of education more palatable to educators (“students can be motivated by seeing connections between their academic work and the jobs they want to have, and that can be a good thing”)?

    I often feel the hardest part, and the most troubling part, about the widening gap in education is watching people wrestle with the cost-benefit question of paying for tuition. I was one of the lucky ones: I got into a great school, paid my way through 10 years of loans, but never doubted the payoff. If it hadn’t been a great school (and maybe in part if my parents hadn’t been somewhat traditional Asians?), I’m not sure the calculus would have been so straightforward. (As to the payoff, well, the personal benefits were incalculable, but the professional advantage remains to be seen.)

  6. Timothy Burke says:

    I suppose online education could make a go of it beyond what it has so far, and that would be particularly true if curricula across the country shifted strongly to narrow, vocational or practical programs.

    On publication, David, what I’m thinking of on the accreditation side is that for a truly cost-saving shift in academic publishing, faculties everywhere would have to put less emphasis on research and publication as the measurement of academic productivity. Open-access journals would produce big savings, potentially, especially in the sciences, where periodicals are a huge budgetary drag, but you’d also want to slow the pace of overpublication, which is what is forcing competitive research libraries to buy huge numbers of expensive monographs.

    I should say in terms of the general replies that some of these observations are precisely why I don’t at all endorse the proposition that the solution is to narrow college curricula to highly practical subjects and throw a lot of services overboard. Not only are some aspects of that solution impractical–as David notes, if you’re going to be a residential institution in a relatively out-of-the-way place (say, Oberlin or Kenyon) you *can’t* just throw your services overboard and tell students to seek their own food, laundry, health club, housing, health care and so on: you’re in communities that can’t presently and probably could never supply those services privately to a seasonal population. Or if the market eventually did supply what was needed, it would be at prices far above what the colleges charge. This is again one of the things that some people need to realize: the total sticker price for colleges is in many cases a fairly good deal still, in that the same package of services might cost more from private providers in many areas. It might be a good idea to have a scaling package of services, I suppose, and to offer a breakdown that would let students price-compare their housing, health club, food, books and so on with local markets.

    The narrowing of curricula seems a particularly bad idea to me, though. If you end up with most American universities and colleges essentially looking like the DeVry Institute, I think you’ve just pissed away everything that has made higher education in the United States a major success in the world. That doesn’t mean that the liberal arts isn’t called upon to rethink its claims to relevance, and that you couldn’t refocus curricula somewhat, but the proposition that the solution is some kind of bare-bones or basics curricula for cost-saving reasons is saving the patient by killing him.

  7. Rebecca says:

    Just a few thoughts. I’ve read your post on the 21st century college a couple of times, and I’ve thought about it, but it’s the dismantling of the community that bothers me. I *like* the idea of a residential college with athetic facilities and other sorts of spaces for living as well as study. What I don’t like, and here’s where colleges might cut costs, is the growing idea that campuses have to be playgrounds. It’s great to have an exercise room with Nautilus equipment and that sort of thing. It’s stupid to install a hot tub that can accomodate 50 people (as some universities are doing). In other words, fancy facilities are becoming so important to institutions’ marketing that it seems like students pick places because of the yoga classes rather than academic quality. If institutions pledged to stop trying to outdo each other with multimillion dollar on-campus entertainment complexes and instead just maintained more basic, utilitarian facilities, it might help.

  8. Dr. Adam L. Gruen says:

    One mustn’t assume that the hiring world will forever use college and university degrees as a cheap filtration system. I’m doing what I can in the corporate world to break this pernicious myth, but like any quixotic quest, it’ll take some time.

    Worse yet, I’ve noticed a *new* myth arising among hiring managers — they know that a college degree is probably useless from a strict utilitarian POV, but they like the fact that graduates from top tier universities have hobnobbed with other graduates. How very 13th century!

  9. ebehren1 says:

    “Moreover, some of the most powerful external costs driving up academic budgets cannot be affected appreciably by colleges and universities acting on their own, but only by some larger public policy. Insurance, for example, or the costs of health care.”

    I think this is a statement you have to defend. People tend to think of most of an institutions budget as fixed, but in reality the entire budget is reflective of a series of decisions that each institution chooses to make over and over when it prepares its annual budget.

    For instance, Swarthmore could kill the Honors program, significantly change its leave policy, close any number of administrative offices, or alter its faculty:student ratio. We don’t, because we assume that we believe these things are roughly good and/or not worth changing. Faced with some sort of radical change in consumer behavior, we could.

  10. ebehren1 says:

    You think after all these years I’d learn to listen/read before I spoke. I see the word “external” now, where I completely skipped right over it when I responded earlier. So I retract my challenge to defend your statement, but still think my general point holds up about higher education budgeting processes.

  11. hwc says:

    It seems to me that the issue of college “cost” does not lend itself to simple analysis. The pricing structure of colleges is not as it seems on the surface, but is, instead, concealed behind a maize of non-transparent discounting strategies. Deciphering these strategies reaveals a significant degree of price competition in the marketplace.

    Here are several issues to consider:

    a) The real price is not the “sticker price” published by the college, but the net tuition, room, and board charged after discounts (finanical aid). For example, Swarthmore’s sticker price is $40,000+. However, in Fiscal 2004, the average Swarthmore student actually paid $26,565 after discounts.

    b) College pricing follows the airline model with each customer paying a different price. Some pay full sticker price. Some pay nothing. Like the airlines, colleges adjust the proportion of expensive to discounted fares to insure that all the seats are sold.

    c) The nature of the tuition discounting reflects institutional priorities and, in many cases, sophisticated enrollment management techniques. Some colleges use their available discounts to attract need-based aid students. Others limit those discounts in favor of offering merit-aid discounts to attract wealthy, high-stat customers. Merit aid discounting is a pure form of price competition.

    d) When the amount of discounting required to fill the seats gets too burdensome, the college is faced with a choice: reduce the discounting (and accept the corresponding decline in average SATs) or reduce expenditures. Smith has recently reached the point where its discounting has pushed the budget out of equilibrium. They have responded by reducing the size of the faculty by 8% along with other cost-cutting measures, including increasing the size of the loan component in their need-based aid.

    e) The real “value” is not determined solely by the net price charged, but must also include looking at the expenditures per student. For example, Swarthmore charged $26,585 per student in 2004, but spent $68,304 per student. That’s a heck of a bargain. Is it any wonder that customers are lined up around the block? Is it a surprise that the handful of schools offering this kind bargain, for a sustained period of time, are the most pretigious, high-demand schools in the country, clustered at the top of the USNEWS charts? To put this value into perspective: If Swarthmore reduced its spending to Oberlin’s level ($40,135 per student), Swarthmore could eliminate all student charges entirely, i.e. make it free for every student. In fact, there are several schools (Berea, Olin) that have adopted exactly this pricing strategy.

    f) The real price-pressure fun will begin in about three years when the echo-boom demographic glut has passed through the system and demand starts to decline. I expect that some of the excess capacity in the system will fall by the wayside.

    Once you start wrestling with these aspects of college pricing, you can start to identify a wide range of consumer options. For example, Grinnell can’t generate the same demand as Swarthmore because it’s in Iowa. So, they charge less (a mix of need-based and merit discounting) and compete successfully in the quality end of the market based on price. They spend less and charge less, thus offering a terrific value for a price-conscious consumer. Conversely, Swarthmore and Williams compete at the luxury end of the market, spending more and charging more (in higher education terms, “charging more” really means having enough prestige to attract more full-fare customers).

    Here are the 2004 numbers (per student spending and net per student price after discounts) for several well-respected liberal arts colleges:

    Swarthmore: spending $68,305 – price $26,585
    Williams: spending $66,936 – price $25,734
    Haverford: spending $54,223 – price $28,896
    Grinnell: spending $46,615 – price $20,399
    Davidson: spending $45,499 – price $25,727
    Oberlin: spending $40,135 – price $22,239

  12. Timothy Burke says:

    You had me worried there for a second, Eric! But yes, I think colleges could take cost control in general more seriously than they do. I just think imposing tight cost control on existing expenditures might produce less in savings than is often supposed. Getting into serious savings territory requires, as you suggest, outright elimination of programs.

    HWC’s comment is extraordinarily useful. For one, it brings to the fore the crucial point which is frequently not at all well-understood, that many small liberal-arts colleges at the upper or luxury end of the market are spending far more per student, *even* the students who are not charged at a discounted rate, than they take in through tuition.

    However, coming off HWC’s observations, one of the things that I do think consumers could reasonably ask of colleges and universities, parallel to some of the demands now being made upon hospitals, is more transparency in breaking down the composition of the cost on the overall bill. When hospitals have been required to do this, it’s been revealed that internal pricing metrics at any given hospital can be wildly different from a very similar hospital nearby: one can charge 11 cents for an aspirin, another $60.00 for the same. That suggests that internal pricing is an arbitrary practice designed to tally up a relatively consistent total bill which covers costs adequately. The problem with that is two-fold: it may conceal from consumers and the general public what the true costs of medical care in a hospital actually are (and thus prevent us having a useful national discussion about those costs) and it may obscure even from the hospital itself where real savings might be possible.

    A college bill which broke down precisely into the particular payments for every major service might not only help consumers understand what exactly it is that they’re paying for, but might help any given college to understand where its costs don’t compare favorably to local market pricing of a particular service. My students observed yesterday, with some fairness, that while you couldn’t find rental housing in our local market at the price we charge in sufficient numbers for our undergraduate student body, some of the housing that we actually provide for that price is, well, pretty crappy: single rooms with two or even three students in them. You can’t buy that kind of housing in our local residential market because there’s nothing quite that squalid available within a mile of the campus. This is not to say that there aren’t arguments in favor of the residential facilities we make available to students, in terms of the positive forms of community building that come from being roomed with someone (or at least the practical skills involved in negotiating privacy and autonomy under those conditions), as well as practical and aesthetic considerations (building a dorm big enough to house students in their own apartments or rooms would require a building much, much taller than anything on campus now, or building out of the current tight clustering of the college’s footprint, plus we don’t have the money to build a huge new facility right now). Still, we owe it to our customers to price housing out in such a way that it allows them to reasonably observe the relation between our prices and comparable local housing markets.

    More transparency would also expose discounting practices to clearer view. This might make for some uncomfortable moments, when it becomes clear that virtually all private institutions follow a pricing strategy that might fairly be called “soak the rich”, but I think it’s again only fair to make that fully visible to the paying customers.

  13. David Chudzicki says:

    I really like the way dining services prices things to let us compare with the local market (and by “local market,” I mean what they themselves sell to people who aren’t on the student meal plan). For example, students on the meal plan pay more than $7.50/$5.50/3.75 for dinner/lunch/breakfast. If one decides to have a meal at Essie Mae’s (the snack bar), the dinner/lunch/breakfast paid for will be accepted for credit for $4.00/$3.25/$2.25 of food. And further, this is only possible at particular times (specifically selected so as to avoid letting students eat when faculty and staff want to be getting their food).

    Anyone in college housing must buy into the meal plan, purportedly because the dorms don’t have enough kitchens for everyone to cook. But that can’t be a real reason. So maybe college housing loses money, and we’re subsidizing that? I don’t know. Is this information available (and I just haven’t found it)?

  14. hwc says:

    From what I have been able to surmise, college housing and dining services are almost inevitably money losers. That’s one reason that so many colleges and universities wipe their hands of dining services and contract the whole thing to an outside vendor like Aramark (the airline food people).

    Yes, two students to a room should lower the cost of housing. But, on the other hand, start pricing what is essentiall a gated residential community on the open market that offers the beauty of Swarthmore’s campus plus 24/7 walk-in health clinic, counseling services, big screen TVs, “free” high-speed internet in every unit and a full service cafeteria for three meals a day. I don’t think you’d find that for what Swarthmore charges.

    However, this misses a key point. College pricing has little or nothing to do with the cost of services rendered. If it did, the prices would be double the current price at most higher-end schools (and all state universities).

    Pricing is purely market driven. If the seats are full on the airplane, then the price is right. If the plane is flying with empty seats (or if the seats are filled with lower SAT scores than the school needs for its desired level of prestige), then the discount price will be lowered to attract more customers. Those discounts may be, and often are, specifically targeted at wealthy, high SAT scoring customers because $40,000 of discounts buys four or five of those highly desireable customers rather than one low income (probably low SAT) customer. The average SATs (i.e. prestige) of the school goes up, thus increasing the appeal to full-price customers down the road. The increasing use of merit aid discounting as a pricing strategy hasn’t happened by accident.

    The spending levels are largely determined by other factors: per student endowment, per student state subsidy, etc. Technically, most schools lose money on every student. That’s why they can’t “make it up on volume” and why growing the enrollment to “increase revenues” is often a fool’s errand in higher education — unless you increase enrollment without adding dorm rooms or hiring a new professor to teach them (i.e. lower your quality). Swarthmore is a financial heavyweight (one of the top per student endowments in the country) in large part because it has not significantly grown its enrollment. It is the enormous per student endowment (roughly $750,000 per student) that allows it to spend $68,000 a year and only charge $26,500. If Swarthmore had doubled its enrollment, the per student endowment would be sliced in half, thus eroding the ability to spend so much above the market-driven price.

    In fact, Williams encountered just this problem when they rapidly increased the enrollment in the ’70’s from 1400 to 2000 to accommodate the admission of the “new-fangled” female students. As a result, they fell significantly behind Amherst and Swarthmore financially because their endowment was diluted. Only by holding their enrollment to zero growth over the last ten years has Williams’ per student endowment caught back up to Amherst, just slightly behind Swarthmore.

  15. Here’s a hypothesis of what employers could use instead of college degrees for those ordinary middle management skills–some combination of standardized test and work history.

    Developing a standardized test and getting it widely accepted would be no small thing, but I don’t see any reason to think it’s impossible As college education gets more expensive, the incentive for such a test would grow. Also, I keep hearing complaints about incompetent college graduates. I don’t know how sound they are, but if the complaints are reasonable, that’s another reason for wanting a test.

    The work history is an alternate way of checking on whether a job candidate is willing to keep showing up and (one hopes) working.

  16. Dr. Adam L. Gruen says:

    Yet another channel is the military, or its functional equivalent. High school freshout graduates that put in their time to a service (honorably), are gold. Anybody with a security clearance becomes platinum.

    In theory, this might also be extended to all kinds of public non-military service, in police work, social work, firefighting, and so on. Considering how strapped some localities and states are for good people within budgetary confines, it isn’t impossible that states and local governments might bypass college grads directly and go for high school grads. Once having demonstrated a track record of working for an organization, these non-college graduates then become excellent hiring potential, the more so if they do any IT-related work while putting in their (low-paid or volunteer) time, which is silver.

  17. SamChevre says:

    Nancy,

    The solution you suggest (using a test and work history) is the logical one; it is, unfortunately, not entirely legal in the US. An employer can use a college degree as a criterion for hiring so long; however, any test must either be directly related to the job to be done or have no disparate impact by race.

  18. Al Lee says:

    I know this is an old thread, but I just found it while investigating Swarthmore tuition prices over the years.

    Here is the key metric: the discounted price of Swarthmore tuition, as a percentage of per capita nominal GDP (PCNGDP), has not changed much since at least 1954, when my father was at Swarthmore.

    My grandfather paid $2000 in tuition, room, and board in 1954. PCNGDP was $2333 (according to eh.net). Swarthmore comprehensive fees were $26,565 and PCNGDP was $39,959 in 2004.

    O.K., fees are not exactly constant: it has gone from 86% down to 66% of PCNGDP. :-)

    To be fair, the 1954 fees are not “discounted”. I probably should knock only about 10% off for financial aid, since “scholarship” cases were far less common then. For example, my grandfather was a sociology professor at a state university, yet he was expected to pay full tuition (not the case today).

    Considering the undiscounted price, what people making >3X the median family income pay, the price has risen only a little: from 86% to 100%.

    This rise in undiscounted tuition represents an attempt by the college to counter-act the other major change from the 1950’s to now: the incredible rise in the income of the top 20% of households, at the expense of the median and below.

    For example, while real per capita GDP has doubled since 1970, the real cost per hour for unskilled labor has only risen less than 5%. This country is incredibly more productive than it was in 1970, but the lower half of the income curve is not seeing any additional income.

    By the way, if you don’t believe my analysis of income disparity growth, see the CIA Fact Book’s description of the US economy. That communist organization makes the same point. :-)

    While it will hurt me in the wallet when I send my child to Swarthmore in a couple of years, it will hurt less than it did my grandfather 50 years ago, particularly since our household is firmly in the top 20%.

    For the top 20% of income earners, Swarthmore is about as cheap as it ever was, by the only metric that matters: fraction of household income. For the rest, the practice of needs blind admissions, and huge tuition discounts based on need, means Swarthmore is cheaper now that it was in the 1950s.

    We are living in the golden age of cheap, excellent, private education.

    By the way, healthcare for students is a red herring. There is no demographic to which providing health services is cheaper than college age, non-reproducing, students. With the exception of a few ACL surgeries, this group may actually cost less now in real terms (because of increased productivity in the health care sector) than it did in the 1950s.

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