Coronavirus Pushes Higher Education to the Brink

The coronavirus has already dealt a vicious blow to key sectors of the U.S. economy. If the pandemic drags on into the fall, though, it’s likely to devastate yet another area that has so far escaped with minimal damage: higher education.

The problems confronting the nation’s colleges and universities long predate today’s crisis. But if current trends continue, the pandemic is likely to act as a catalyst for a historic reckoning that may transform the delivery of higher education in this country.

It’s common knowledge that the cost of attending both public and private institutions has grown far faster than the rate of inflation over the past 40 years. Since 1980, the sticker price of tuition, room and board has more than doubled in inflation-adjusted dollars.

In 1971, for example, the average total of tuition, fees, room and board per year at private four-year institutions was $18,140 in today’s dollars. Compare that to the average cost of attending now: $48,150. Likewise, that average at public institutions rose to $21,370 from $8,730 in the same period. This has fueled the much-publicized explosion of student-loan debt.

But colleges and universities have their own debt woes. Over the past 40 years, schools, particularly less selective ones, have fought ever harder to attract students. The conventional wisdom held that the best way to do so was to upgrade facilities, build new dormitories and student centers, and provide increasingly luxurious amenities. The result has been a flood of debt, with a growing proportion of revenue dedicated to servicing it.