The University of Chicago is on pace to be the first university to break the $100,000 mark for its annual cost of attendance, according to new research from The Hechinger Report. Predicting that the highly selective university’s cost will reach six figures by 2025, the analysis also explores how many institutions’ “tuition inflation has been driven by an enrollment strategy that relies heavily on tuition discounting.”
UChicago could be the first to surpass $100,000, but a number of other institutions—including Columbia University, Harvey Mudd College in California, and Texas’s Southern Methodist University—appear soon to follow. Experts point out that high prices actually make institutions even more appealing to some students. “The [colleges] that are expensive are the ones that students want to apply to,” Robert Kelchen, a professor at Seton Hall University who focuses on higher-education finance, told The Atlantic. “Being expensive is seen as being good—if one [elite] college is 20 percent cheaper than another [elite] college, students are going to wonder what’s wrong with it.”
Escalating sticker prices mask widespread discounting
Families attuned to the inner workings of higher ed may realize that many colleges and universities now offer incoming students sharp discounts on tuition and fees. At UChicago, around 63 percent of students do not pay full price; according to The Hechinger Report’s research, students from families with income below $75,000 are paying “roughly $5,200 on average” to attend the school this year.
Proponents of tuition discounting say it helps low-income students attend highly selective, expensive institutions and enables colleges to counteract declining enrollments. But critics caution that high sticker prices deter many prospective students, especially those from lower-income families. “Students—low-income, underrepresented minority—still look at sticker price,” says Ann Gansemer-Topf, associate professor of education at Iowa State University.
“Even though most families will not pay [the sticker price], it is a signal about what a full membership in that college costs,” says Caitlin Zaloom, an NYU professor and author of the book Indebted. “It is information to students about who should apply and who can participate fully in the university.”
Discounting also is straining colleges’ bottom lines, especially at less-prestigious institutions, where administrators working to hit enrollment targets may “discount tuition until the advertised price becomes virtually meaningless,” The Hechinger Report writes.