Rising Tuition Costs and the Need for a Talented Workforce

By Shuktika Maheshwari, Matt Lusty, & Marisa Bomis Tuition is Rising

Over the past few years, tuition cost has become a matter of concern for the nation. Economics reporter John W. Schoen of CNBC.com says  “since 1971, tuition has risen six percent more than inflation, forcing more and more students to take higher amount of loans. This has resulted in an astounding $1.2 trillion in outstanding student debt, and has forced many students to ask: is college worth it?”

The widening gap between household income and college tuition makes the increase impactful. As a result, American students are taking $100 billion a year in loans through private and publicly funded loan programs. Using Harvard as an example:

  • 1971: Tuition was $2,600; about 13 weeks’ worth of the median household income of $10,285.
  • Presently: the median household’s entire year of income will be needed instead

The wealth gap between American universities is also increasing. The top 40 richest schools receive almost 60% of all gift revenue. Students attending schools other than these top 40 are paying the bulk of their education costs in the form of tuition.

Research still shows however, that college graduates earn more than those with a high school diploma and, as a result, students and their families have continued to invest in postsecondary education. As an example, annual college enrollments in 2013 compared to 1971 have doubled to 19.5 million.

But be warned, these numbers are now declining.

The Business Case for Education

Due to steady economic growth, it has become imperative for Utah to improve higher education graduation rates so as to develop a talented and capable workforce.

To help put Utah in the top-ten states for percentage of working age adults with a post-secondary certificate or degree, Prosperity 2020, the coalition between Utah education leaders and private businesses, endorses the following:

  • Target 66% completion rate of higher education attainment in our workforce by 2020
  • Investment of $145 million over five years to improve the salaries at Utah’s public colleges, which are presently at the bottom 20% of the country
  • Investment of $85 million over five years to reward institutional performance in:
    • Increasing graduation rates for outreach initiatives
    • Increase participation and completion rates of underserved students
    • Increase certificate and degree programs
  • Investment of $35 million in financial aid to meet the increasing demand for Regents’ Scholarship and to create and expand performance-based scholarships targeting low-income students, such as the Dream Weber Scholarships

For Additional Information

Download Prosperity through Education-The Innovation, Accountability and Investment Plan for Utah’s Future here: http://prosperity2020.com/the-plan-goals/

Learn about Plateau Tuition and how it can help students and use an interactive calculator of the costs of tuition and fees for higher education institutions in Utah by visiting USHE’s website here: http://higheredutah.org/plateau-tuition-how-can-it-help-students/

Original article by John W. Schoen, CNBC.com Economics Reporter at http://www.cnbc.com/id/102746071.

About Prosperity 2020

Web: http://prosperity2020.com/

Prosperity 2020 is a coalition of Utah education officials and private businesses to increase educational outcomes in the state. Prosperity 2020 aims to improve Utah on the education front drastically so that the state’s long-term growth is secure, and businesses can invest in the state with confidence. Specifically the group has adopted the goals of Utah being in the top 10 states on the 4th and 8th grade NAEP reading and math assessments respectively, in high-school graduation rates, and two-thirds of Utahns achieving postsecondary training by 2020. Prosperity 2020 has created a plan of investment in crucial areas such as educational tools, assessment technologies, elementary and secondary teachers’ as well as college professors’ compensation, and financial assistance for low-income students in order to promote educational attainment for everyone, including at-risk students, and thus ensure that Utah is the top state in the nation to attract investment and nurture growth.