The cost of higher education has skyrocketed in recent decades. According to the U.S. Department of Education’s National Center for Education Statistics, the average annual tuition cost at a four-year college or university in 2014-15 was $25,409. That compares to an average one-year tuition cost of $5,160 (in current dollars) during the 1983-84 school year.
The high cost of college tuition keeps many Americans — especially those from low-income families — away from traditional, four-year universities. Among the long-term effects of rising tuition costs is limited access to higher education, which ultimately leads to fewer skilled graduates for companies to recruit, said Sarita Brown, president of Excelencia in Education, a nonprofit research and policy organization for Latino students based in Washington, D.C.
“It is any country’s most precious resource,” Brown said. “Education is a means for that human capital to find the career path, the work settings to channel their energies.”
Nevertheless, the rising cost of education has opened up debate about the role it should play in society and who should have access to it. Is college a public good for everyone to have access to? Or should it be a private benefit for those who can afford it?
Brown advocates for the former. Because institutions of higher education funnel educated people into the talent pool, Brown said business leaders should invest more time and money into these schools. “Employers need employees. It is in their [employers] self-interest. An investment in evidence-based practices that do promote completion in terms of college education and successful entrance to the workforce is a very wise investment,” Brown said.
Others aren’t so keen on providing a college education to all. “College isn’t for everyone,” said Bob Luebke, senior policy analyst at Civitas Institute, a Raleigh, North Carolina-based think tank. “Not everyone should go. Now, I said, ‘college.’ I did not say, ‘further education.’ That’s an important distinction.”
Luebke doesn’t see free college tuition as a panacea to solving America’s education and student debt woes, as some politicians have suggested. “It sounds good, but I think it’s a fundamental misdiagnosis of the problem,” Luebke said. “The whole assumption of that debate is that we would automatically perform better because more people would go to school, and we’d have more educated people, and it would be better for the economy.” Among people with federal student loans, the college completion rate is only 55 percent after six years, The New York Times reported in June 2016. Furthermore, the graduation rate among public universities is only 46 percent. Luebke pointed out that there are other options for postsecondary education, such as training schools, online education, apprenticeships and corporate training.
Karie Willyerd, head of global education at software firm SAP SuccessFactors, agreed that access to four-year programs isn’t the answer to our country’s education woes. “We think of the community colleges as a second-tier education,” Willyerd said. “I don’t think we should do that.” Rather than requiring an employee to go through a four-year program, an education at a community college could suffice, Willyerd said.
Should business leaders continue to prefer traditional universities, Willyerd suggests they get involved in their local institutions by being on boards, thus influencing spending from the inside.
The long-term impacts of preferring expensive education put a lot of pressure and responsibility on businesses. If the costs of higher education remain as they are now, Willyerd said that employees will come into the workforce with high amounts of debt, and they will exert wage pressures on companies. “We should be interested as businesses in terms of what that’s meaning to the cost of doing business,” Willyerd said. “We’re eventually paying for it, one way or the other.”
Additionally, the high cost of education will only limit the talent pool, despite employers’ demands for more highly trained workers, said Barbara Gault, vice president and executive director of Institute for Women’s Policy Research, a nonpartisan think tank in Washington, D.C., that focuses on issues related to women and the intersection of gender, race, ethnicity and income levels. And as more people fail to live up to their earning potential, that means smaller tax bases. “It will mean that we’ve lost out on the opportunity to promote future generations’ learning and success,” Gault said.
Lauren Dixon is an associate editor at Talent Economy.