Tuition passes inflation

Yale College’s 4.5 percent tuition increase, announced last week, is its lowest in five years. But following a tradition stretching over the large part of three decades, the price of attending college here has risen faster than the expenses faced by schools nationwide.

Annual term bills, including Yale’s, have been increasing at a pace faster than both consumer and higher education inflation on and off for at least 30 years. The reason, administrators and some outside experts said, is that the University’s costs rise faster than the average rate of even higher education inflation. But critics of increasingly high college tuitions said Yale and other elite universities are spearheading the rise in tuition rates nationwide, and should set an example for the rest of higher education by reducing or eliminating the increases.

Over the last 12 years, Yale’s term bill increases have outpaced the Consumer Price Index every year but two, and outpaced the Higher Education Price Index either seven or eight times, depending on how tuition and HEPI data are compared. In the past decade, Yale tuition increased 49 percent, compared with a 26 percent rise in the CPI and a 46 percent increase in the HEPI.

Examined over a longer period of time, the trend is even more striking. Looking back 30 years, Yale tuition increased 570 percent, while the HEPI went up approximately 322 percent and the CPI 233 percent over the same period.

It is widely known that colleges, including Yale, have increased tuition faster than the Consumer Price Index has grown. But administrators have maintained that it is misleading to compare the CPI — a measure of the rising cost of consumer goods — with tuition increases. The University’s costs, such as faculty and staff salaries, academic journal subscriptions, and computing infrastructure, represent a far more expensive market basket of costs than that of the average household.

The HEPI attempts to provide a more accurate picture of inflation as it applies to universities. It is heavily weighted toward salaries, a cost rarely experienced by households that makes up a large part of universities’ budgets. Yale’s budget is 57 percent salaries, Deputy Provost Charles Long said in a past interview with the News.

Still, Yale administrators said that even the HEPI does not provide an accurate picture of the University’s costs, particularly in recent years. Adding new programs and services, such as improved financial aid or initiatives in the undergraduate science and quantitative reasoning program, can push Yale’s costs above the HEPI, Provost Andrew Hamilton said. And the costs can rise faster than inflation even without new programs, as with rising utility and renovation expenses. Yale’s construction costs grew by 7 percent in the 2007 fiscal year, Hamilton said.

The University’s undergraduate tuition and fees have been set at $45,000 for the 2007-’08 school year.

University President Richard Levin said Yale has attempted to keep its tuition increases low while providing a high level of resources, making it one of the least expensive universities in the Ivy League. Tuitions at private universities in general do not vary widely, he said, even though the experiences offered often do.

“Students have tons more resources at their disposal here than students at less wealthy institution[s],” he said. “[Yale has] cultural and library resources that are completely off the charts when compared with other American universities.”

But author William Strauss, a critic of the increasingly high cost of attending college, said Yale and peer institutions set an example for many other schools, making their impact far greater than on several thousand undergraduates each. Even if other institutions do not match Yale’s tuition, they often use the increase as a benchmark and will increase their own tuition by a certain percentage of that of the Ivies, he said.

“Yale students, by and large, have a greater opportunity to pursue callings if they so choose that will repay whatever costs their education was, but students at those other schools can’t,” Strauss said. “A number of them drop out with loans. I just don’t think the trustees of Yale understand what the implications of 25 years of above-inflation increases are having on the Millenial generation.”

In the last 30 years, Yale’s tuition increases have exceeded the HEPI 24 times. An important factor in elite schools’ rapidly rising tuition is faculty salaries, said Ronald Ehrenberg, director of the Cornell Higher Education Research Institute.

“A big component is faculty salaries in private institutions relative to public higher education,” said Ehrenberg, who is on the advisory board for HEPI. “And it is rising more in certain private institutions than in others. Places like Yale are not typical higher education institutions.”

HEPI does not actually give the full picture of costs for any college that is trying to be competitive, said Donald Paukett, assistant vice president for administrative affairs at Binghamton University. The index only measures the rise from year to year in the base costs of offering an education, but universities need to offer new programs and facilities to remain — or become — attractive to applicants. Paukett is also on the HEPI advisory board.

Even though HEPI may not be “perfectly matched” for looking at Yale’s costs, Frederick Rogers, HEPI advisory board member and vice president of Carleton College, said there is no other index he is aware of that measures cost increases for universities.

The HEPI was compiled by Research Associates until 2005, when it was taken over by the Commonfund Institute.

Comments