This is a repost from Forbes.com. For Full article click HERE.
Recently, we looked at the impact of coronavirus (COVID-19) on colleges and universities. That article looked at the effects on colleges and universities in general, while here, the focus is more on the effects in regards to tuition and related financial matters. For both students and colleges, the coronavirus crisis has created a massive disruption in the financial “norm” of higher education. With schools closing, switching solely to online, restructuring classes, cutting costs and so much more, some of the most basic assumptions about college and college life have already been thrown out the door.
Impact of Coronavirus (COVID-19) on College Tuition and Finances
Long before the coronavirus pandemic, college costs had already entered unprecedented territory. According to a study by BrokeScholar, the average cost of tuition and fees — in inflation-adjusted dollars — at both private and public schools has more than tripled from the academic year 1971-72 to 2019-2020.
- In 1971-72, average tuition and fees at a private nonprofit four-year institution cost $11,540 in 2019 dollars. For the 2019-20 academic year, the current average cost is $36,880 for tuition and fees: an increase of 220%.
- In 1971-72, average tuition and fees at a public four-year institution cost $2,710 in 2019 dollars. For the 2019-20 academic year, the current average cost is $7,730: an increase of 285%, which means it nearly quadrupled.
Thus, the costs associated with attending a college or university were already moving in an unfavorable direction for the average American household. But throwing the coronavirus pandemic into the equation is now presenting a multitude of issues that could accelerate this trend or send it off into erratic directions. On the other side of the equation, the colleges are facing troubling financial straits due to the disruption in tuition, fees and on-campus life.
“When it comes to higher education institutions, the pandemic has had — and will continue to have — a drastic financial impact. Institutions are suffering from lost revenue to partial tuition refunds, room and board, fees, etc.,” said Michael Hansen, CEO of Cengage. “For example, the Pennsylvania State System of Higher Education, which oversees 14 universities, including the first HBCU (historically black college and university) of Cheyney University, and 17,000-student West Chester University, is projecting a $100 million loss from room and board and other fees. And the University of Wisconsin at Madison is estimating a $100 million loss due to COVID-19 impacts, which does not include potential lost revenue from lower enrollment in the fall. While a select few institutions have large endowments to help them navigate through this unprecedented period, the majority do not.”