Matt Rocheleau of the Boston Gloibe has done us all a service by looking at the changing pattern of college costs and financial aid at 33 Massachusetts private colleges and universities. Unlike many writers on this subject Rocheleau has done it right, by looking at net changes, that is costs after financial aid has been deducted from tuition and fees.
The headline on his article, “College Costs Top Inflation.” in the Boston Globe for June 22 2014 tells part of the story: from 2008 to 2013 the average net cost at these schools went up by 10.5% (versus an 8.2% increase in the CPI during that time). Not a big difference? Tell that to someone whose family income has stagnated or declined during that period.
The striking thing to me, however, is the huge variation among institutions. The figures show that some institutions have made dramatic efforts to increase student aid, while others have let tuition increase and aid decline. Mount Holyoke is the extreme case of the latter pattern according to figures in the Globe. During the 2008 – 2013 period financial aid declined at Mt/. Holyoke by 2.9% and net cost increased by 23,9%. Result: average net costs are significantly higher there than across the way at Smith. At the other end of the spectrum were a very diverse group of institutions, includiong Hampshire, Harvard, Northeastern, Simmons, and Suffolk, at each of which net costs actually decreased. Some of the changes are dramatic. At Northeastern, for example, student aid increased by 64.7% and the net cost declined by 7.2%. Changes of that order may be driven by market strategies, but still seem to me to point to heroic efforts by the institution’s senior leadership.
If these colleges managed to reduce net costs, can’t other colleges do so too? There are, to be sure, local factors at work among ostensibly similar institutions. The contrast between Amherst and Williams, for example, is striking. Amherst increased aid by 20.1% and saw its net cost increase by 11.6%. In the same period up the road at Williams, financial aid went up by only 10% and the net cost increased by 47.4%. Result: the net cost at Williams is now about $3,000 higher than that at Amherst, according to a table accompanying Rocheleau’s article. Why the difference? The Globe story gives some answers, but the question still needs to be pressed – how can some colleges keep net costs down while at other it keeps rising?