Report: Public college tuition rates see lowest increase in 30 years

New figures on college costs in the United States indicate that student borrowing will continue to accelerate, even though the eye-popping tuition increases that have plagued college students in the last few years will not.

The average cost of tuition and fees for in-state students at public four-year colleges is $8,893 for the 2013–14 academic year, a 2.9 percent increase from the previous academic year, according to the nonprofit education organization the College Board, which released its annual reports on pricing and student aid on Wednesday.

That represents the smallest one-year increase for U.S. colleges in nearly three decades. Tuition rates and fees for the 2012–13 academic year increased 4.5 percent over the previous year, 2011–12 saw an 8.5 percent jump.

Out-of-state tuition and fees for public colleges rose slightly more — by 3.1 percent — to reach $22,203 in 2013–14. And at private, nonprofit four-year colleges, tuition and fees increased by 3.8 percent to reach $30,094 in 2013–14, only slightly lower than the increase of the previous school year, according to the College Board.

The researchers wrote that the “relatively small increases” signal that “price increases are cyclical. The startling price increases of recent years, coinciding with the Great Recession, paralleled increases in other economic downturns. They did not signal a new era of accelerating prices.”

However, the researchers said college prices have increased more rapidly than other goods and services in recent years, and because upper-income families fared better than others during the economic recovery, higher education has seen more economic stratification.

Jennifer Engle, vice president for policy research at the research organization Institute for Higher Education Policy, said a slowdown in tuition increases does not mean college is more affordable.

Engle said that both state and private colleges and universities have increased their merit-based scholarships in an effort to attract star students, while college is still unaffordable for many low-income students and their families.

“A lot of it has to do with the rankings effect,” Engle said, referring to the widely read annual college-ranking issues of publications like Forbes and U.S. News & World Report. “When you talk to folks on access-oriented campuses, they’re all striving to become like the institutions ranked ahead of them, because that’s the incentive structure.”

On the other hand, Engle said dozens of states have been able to increase their appropriations for in-state colleges and universities because they have recovered from the economic crisis, so schools like the University of Iowa and the University of Nebraska have been able to freeze tuition rates.

The College Board reports show that federal loans made up 43 percent of student aid during the 2012–13 academic year, the lowest level in a decade. By contrast, federal loans made up 49 percent of student aid in 2008–09.

Still, student borrowing is unlikely to go away soon.

Grants, which students do not have to repay, made up 49 percent of student aid in the 2012–13 academic year — the highest percentage in the last decade. “But that trend is not continuing,” the report said. The federal government expanded its grants to students between 2008–09 and 2010–11, which softened some of the blow of rapid tuition increases, but federal grant aid for students declined by 9 percent between 2010–11 and 2012–13.

The authors wrote that “stories in the press about individual students with startling amounts of debt obscure actual borrowing patterns,” and that a relatively small number of students are strapped with staggering amounts of debt, in the hundreds of thousands of dollars.

The overall figures are a little more moderate. About 60 percent of college students earning bachelor’s degrees in the 2011–12 academic year graduated with debt that averaged around $26,500, according to the report.

But Engle said that while a certain amount of borrowing does not have to be a bad thing for students from middle-income families who may not have been able to afford college without loans, the financial crisis spurred stricter standards for both public and private student loans — and that is affecting low-income and minority students, like those who attend historically black colleges and universities (HCBUs), some of whom need more aid.

“This is the college population of the future,” Engle said, “but we’re still operating from the kind of individual framework, the individual competition framework.”

She added, “Those are the students that are really bearing the brunt of the higher education costs by shifting the aid away at the state and institutional level.”

Al Jazeera