The Cost of Education: Trends and Options

By Evan Jones

Probably the first thing that springs to mind when considering college is the cost. There is no question that the expense of a traditional college education is daunting and has been increasing continually, far outstripping the rate of inflation. Tuition, room, and board at public institutions (factored for inflation), has increased 88% in the 45 years from 1965 - 2009. At private colleges, the story is even worse: a 138% increase over the same period. This steady trend shows no sign of changing in the foreseeable future.1

While regrettable, this is understandable. Demand for education is way, way up. The “blue-collar option” has hugely diminished since 1965. Many (if not most) of those jobs have long since been automated or shipped overseas. More and more Americans are working behind desks, manipulating words and numbers, and that means that education is at a premium. It is a hard fact that a college degree is more important than ever. In some cases, basic degrees aren't enough, and they're expanding their resumes with business and accounting courses .

On the other hand, as expensive as college can be, it is still well worth it over a lifetime. The average worker with a high school education can expect to earn $1.2 million over his or her working life, compared with a $2.1 million average for college graduates. Opinions differ, of course. Some claim that real-world experience trumps the academic environment. In fact, it is possible to gain some credits through professional experience and online college courses that are recognized by ACE and many colleges. And while it is true that some entrepreneurs and sports stars have achieved huge success without college, these tend to be the exceptions: On average, a college degree will boost earnings 75% higher than a high school diploma. Therefore, your degree will likely make hundreds of thousands of dollars of difference over your working life.2

1 Average undergraduate tuition and fees and room and board rates charged for full-time students in degree-granting institutions, by type and control of institution: 1964-65 through 2008-09, Institute of Education Science, National Center for Education Statistics, U.S. Dept. of Education, table 334

2 Brooks C. Holtom (Pro), Tony Brummel (Con) College Is Worth the Cost, The earning potential and variety of opportunities a bachelor’s degree bestows justify the cost of tuition. Pro or con? Bloomberg Businessweek, Mar 2010