Easton, Pa. — Demand for higher education is up, but so, too, are college costs. The returns on investing in a bachelor’s degree have grown, yet net prices, for many families, have increased relative to their incomes. Put another way, it’s both an exciting and nerve-racking time to lead a postsecondary institution, especially a residential liberal-arts college with a big price tag.
On Tuesday morning, Catharine Bond Hill, president of Vassar College, shared her view of the economic challenges that face public and private colleges, and the students they serve, during an era of dwindling financial support from states. “Whether we like it or not, families are going to have to bear more of the costs of higher education,” she said. “We have now entered a second-best world, and I think we’re going to be there quite a while.”
Ms. Hill spoke here on the second day of a conference (“The Future of the Liberal Arts College in America and Its Leadership Role in Education Around the World”) sponsored by Lafayette and Swarthmore Colleges. She described the complex dance of costs, sticker price, and net price at institutions like her own.
Ms. Hill described the difficulty of maintaining affordability without sacrificing quality. More must be done, she said, to facilitate student borrowing, including income-contingent loan options that would protect at least some graduates from a portion of their expected debt.
At the same time, Ms. Hill urged liberal-arts colleges to take a hard look at their costs, whether it’s spending on athletics or on organic food in cafeterias. What can institutions stop doing? In the past there were not as many incentives, or pressures, to control those costs, she said, but now the market is changing: “The important question is, Why haven’t we innovated? We have, but in ways that have pushed costs up.”
Ms. Hill mused about the possibility of adding summer sessions and offering three-year degrees, which, she said, would lower “opportunity costs” for students. This might be much easier said than done, however. Asking faculty to do more could jeopardize quality, Ms. Hill said. Instead, she urged her colleagues to think about ways of allocating faculty time more effectively, perhaps rebalancing their teaching, research, and governance duties. “There’s room for shifting faculty time to high-value inputs with students,” she said.
What else could institutions do to tame costs? Persuade the government to let colleges collaborate in a manner that’s now prohibited by antitrust restrictions, Ms. Hill suggested. “If we could collude to control costs in service of affordability and mission, it might help,” she said.
Even then, of course, consensus wouldn’t be easy. “I think we could all sign on to no more climbing walls and saunas,” Ms. Hill said. “But what about average class sizes and teaching loads, and the number of languages being taught? It’s much more difficult to agree on those things.”
One option that nobody should embrace? Reducing financial aid, Ms. Hill insisted. “What it costs to educate a student would remain the same,” she said. “It just changes the net price that we’re asking the student to pay. … Cutting financial aid is easier than cutting costs, but I don’t believe it’s in our long-run missions or our short-run missions.”
One major challenge for liberal-arts college relates to the expectations of their clientele, especially the most-affluent students, who often come with sky-high expectations for services and amenities, as well as for the totality of their experience. Often the same parents who ask about outcomes data also want to make sure that their son or daughter’s room is very, very nice, Ms. Hill noted.
“Many families are willing to pay for quality as they perceive it,” Ms. Hill said. “We compete for talented students, and many of them are willing and able to pay for these things.”
At the same time, other families may well find rival sectors of the market more and more appealing. Leaders of liberal-arts colleges should pay close attention to for-profit institutions, Ms. Hill advised. “I think they’re going to test our definition of quality,” she said, “in terms of what students or families want.”