College tuition inflation has risen faster than medical services, child care, and housing. While financial aid usually helps students pay far less than the “sticker price” of tuition, the net price of public four-year colleges has more than doubled over the past 20 years.
The United States governments pay more (as a percentage of GDP) toward higher education than other "peer" countries.
Unfortunately, only 24 percent of four-year and 40 percent of two-year public colleges can be considered affordable, according to a 2022 National College Attainment Network (NCAN) report. Students end up with too much loan debt when the “affordable” institutions are no longer that.
Given this situation, higher education is scrambling to find ways to lower its costs.
Utilizing Technology
The average college student spends between $628 and $1,471 annually for books and supplies as of the 2021-2022 academic year. Hard copy books can cost as much as $400, with an average price between $80 and $150.
Additionally, textbook prices increased by an average of 12% with each new edition. But with the recent uptake of technology, schools can cut costs by reducing reliance on manual resources, offering flexible and scalable online material, and introducing course management automation.
For example, textbooks must be interactive to stay relevant in an era of blended and online learning. Higher education can supplement traditional chapters with multimedia content and in-class assessments for a richer learning experience.
Digital textbooks offer learners engaging material and the ability to collaborate with their peers, all while drastically reducing student costs.
For example, Apple's technology is built for innovation and defies limitations, especially in the classroom. The company states that “powerful” hardware works with software to help faculty and staff create the best experience for students to explore, learn, and grow.
Apple Education helps professors and students research and analyze data, transform learning environments, push the boundaries of athletics, and, most importantly, save money on a new Mac, MacBook, or iPad by shopping at the Apple Education Store, which offers discounts all year round.
Slashing Administrative Costs
Perhaps the most significant cost afflicting colleges is the sheer number of staff they employ. According to a 2020 press release, the growth rate in the number of administrative staff has been five times that of professors in the past 40 years.
American higher education has been sinking slowly beneath the burden of administrative costs.
Therefore, since administrators make spending decisions, policymakers outside of higher education must set rules that create strong incentives for colleges to chuck the bureaucrats.
Colleges and universities should also work toward being financially transparent. Financial visibility is critical to institutions that value external funding, like higher education. Technology and cloud-based solutions help CFOs and finance directors get a clearer picture and better control over where the money goes.
Additionally, institutions should make better data-driven decisions. In the education sector, the stakes are too high to accommodate administrative tasks that work without a comprehensive, data-driven picture of all its processes.
Data-driven decision-making allows institutions to identify new or missed opportunities, respond to new market conditions, launch innovative services, and meet student needs.
