The same can be said of police officers… There are lots of social work needs in the US, but “we” (various levels of government) are unwilling to pay for much actual social work, so it becomes something that schools and police departments end up with by default.
2 Likes
@gwnorth We were both writing at the same time. I’m not entirely certain I agree with your outcome, but we’re on the same page about the underlying challenge that schools are facing. It’s not one that individual schools can handle any more than individual communities can, so there’s going to be a gap while we wait for state and federal reforms in fundamental services like health care. Not an easy time.
OK then Yale doesn’t need to provide any recreational facilities or health care services. They can just stick to providing academic supports and students can access the existing services in the community.
1 Like
Except that Yale’s competitors do. Hospitals also face the same competitive pressure. Every one of them wants the latest equipments that help drive up the cost for everyone. Now we wonder why healthcare and higher education are the two sectors that cost so much more in this country than anywhere else.
2 Likes
Health care costs also get embedded into the cost of employing people in labor intensive industries like education, since employers pay for a lot of employees’ health care in the US.
Of course, health care workers often have substantial educational debt for the education required for their jobs.
1 Like
New Haven has a poverty rate of ~25%. I would think that community health care providers would welcome fully-insured students as patients.
1 Like
I see a lot of discussion about amenities and how it’s all the extras that are driving the cost of higher education. But if those amenities or senior administrative positions were eliminated, would prices go down? I doubt it, because “willingness to pay” would remain high. Eye-popping increases in prices have not decreased demand, at least not for the most selective institutions. Those schools appear to benefit from (status anxiety-driven) price inelasticity, and when, for certain customer cohorts, they encounter some price sensitivity, they have the resources to engage in price discrimination tactics through aid packages.
2 Likes
College tuition isn’t driven by supply and demand. It has little to do with the college’s selectivity or desirability. A college like Yale can theoretically absorb some of the cost, or charge much more than it does currently. However, colleges with much smaller endowments would have to pass on their costs. They’re the ones driving up the tuitions. Yale’s of the world just happily follow.
2 Likes
But there will be a wave of closures as those less resourced schools find they need to increase merit to achieve volume/yield while losing full-pay families who might have other options. And the list of the most expensive colleges in the US looks pretty selective to me.
1 Like
Why else would schools offer deep tuition discounts in the form of “merit” scholarships to attract the students they desire?
3 Likes
Supply and demand certainly does drive college discounting (financial aid and scholarships) and therefore net tuition after the effect of these discounts.
1 Like
That’s from the perspective of the students who received their merit scholarships. These students don’t have sufficient financial resources to ignore the monetary inducement. From the college’s perspective, it only tries to compete for the students who would otherwise go elsewhere. It doesn’t offer merit awards to everyone. On the other hand, colleges like Yale don’t offer merit awards, and they don’t charge more even though they could.
1 Like
You can’t really have that discussion without mentioning the impact of Federal financial aid. When the costs of college for some are five digits and the costs for others are zero there is not an ability to weigh demand. Even low income kids often don’t know what their package will be. True, there is a high demand for college in the US and people do see the long term financial impact of a college education. So many people are willing to borrow a lot or spend a lot to get the education they want. That doesn’t correspond to a regular market with supply and demand.
Federal grant aid of up to $6.5k for undergraduate (maximum Pell grant) plus the maximum direct loan of $5.5k does not come anywhere close to bridging the difference between $4k and $80k that exists in elite college net pricing for undergraduates.
That’s ok, and even desirable, in a system with too many colleges with too many unfilled seats.
1 Like
Yes. Yale and close peers could justify hiring their “bloat” if they said they are sitting on mounds of cash in the form of the endowment, and they plan to spend down that endowment to create a better world (DEI initiatives etc) or even a just a better student experience (the nice gym, though I agree with above posters re: gym money coming from athletics and donors). But what’s unacceptable is that they have been squeezing faculty in the process, and insist on maintaining or increasing endowment to live off of tuition payments (which are very large for full pay families) and interest from the endowment principal. Less selective colleges don’t have that option (spending down a huge endowment, or getting enough interest from an intact endowment). It’s a tough time to be an academic. I think we’ll see more and more of academia filled with folks who have family money. That will change American universities eventually…a smarter person than me might be able to predict how they will change.
2 Likes
Seems like it’s been tough to be an academic, in terms of job opportunities and pay, for at least the past decade. I don’t know what all the consequences have been/will be either, but with 70% of college instructors not tenured or not on the tenure track, seems like that is directly related to the tough job market, something which won’t be reversing any time soon.
1 Like
There are a lot of problems in higher ed and Yale is the perfect safe place to talk about it. Yale has enough money and demand that they can have bloated payroll and keep on keeping on.
If we insert Hartford College up the road instead of Yale the problems make a lot more sense. The teaching faculty want a raise and they see cutting the bloated administration as the only path to that raise. The problem is much bigger though. Colleges have been increasing prices to the point where they are probably near the top. Not at Yale of course, but at the remaining 99% there isn’t a lot of room for tuition growth. Add in the economic headwinds:
-The stock market is no longer posting big gains for their endowments, 529 plans, and parent’s wealth.
-Enrollment is dropping.
-That sweet sweet federal stimulus has dried up.
-People are talking about student loan burden.
-Oh, and inflation is driving up costs.
Schools have to find money to pay the non-teaching side more money or they will leave. Professors don’t really have that option, so they will have to get by with less buying power.
There are plenty of good reasons to pick Yale over UCONN, but Hartford over UCONN? Not so much.
4 Likes
Schools are turning to finding alternative revenue streams in order to keep operating. Tuition does not support the true costs. I worked at a school that was struggling with how to develop these revenue streams. The problem is that it takes additional personnel to do the development work, facilities are needed if there will be programming involved, etc. Nothing is ever free, and it’s a leap of faith because you don’t know if it will work out.