The Cost of College, Then and Now

This spring state legislators are holding committee hearings to discuss and debate higher education funding. Taking part in those conversations are students and advocates, who have been asking for more funding to help cover living costs. They assert that living costs have not kept pace with financial aid, leaving many students struggling to make ends meet. One common response to such arguments is the “back in my day” line of reasoning. “Back in my day, students worked and went to school just fine… Back in my day, we graduated with little to no debt, no homelessness, no unmet basic needs,” etc.  If students “back then” were able to make it happen, why can’t today’s students? Are today’s students asking for too much? Should they just buckle down and get by with what they have, like their parents did? To better understand these arguments, this post compares college attendance costs for today’s students (2018-2019) to students 40 years ago (1979-80) attending California’s four-year public universities, the California State University (CSU) and the University of California (UC).

The cost of a college education consists of two main costs: 1) tuition and fees and 2) living costs (of which housing and food are the greatest expenses). Tuition and fees are mostly determined by colleges and universities while living costs are largely determined by markets for housing, food, and other costs.

In 1979-80, tuition and fees at the UC were $2,200 in 2018 dollars, adjusted for inflation. Today’s students pay more than six times that amount, $14,400 for resident undergraduates. Between 1979 and 2019, tuition and fees at the CSU rose by $6,800 in inflation-adjusted dollars (a 1,360% increase). During the same period, food and housing-related expenses increased by 40%.

Historically, the UC and CSU received the majority of their funding from the state’s General Fund. However, years of budget cuts have shifted the cost of public higher education from the state to the student, as universities raised tuition and fees to make up for lost revenues. While the increased price tag is alarming, California’s state financial aid program is tied primarily to tuition costs, so many low- and middle-income students have not felt the financial burden of rising tuition. The Cal Grant A and B tuition and fee award cover up to $5,742 at CSU and $12,570 at UC. In addition, the CSU and UC have their own institutional need-based grants that help cover tuition and fees.

At the same time, the cost of living has also increased. Incomes for low- and middle-income families have not kept pace with housing costs, creating a housing affordability crisis in California where more than half of renters face unaffordable housing costs. The Cal Grant B Access award and CalFresh program provide assistance to help cover food and housing costs, yet their purchasing power has diminished over the years and now covers only a fraction of food and housing costs, leaving many students struggling to make ends meet. Today’s students pay $4,000 per year more in food and housing costs, in inflation-adjusted dollars, than students in 1979-80 — that’s $16,000 more during the course of a four-year degree. That $4,000 is equivalent to working nine additional hours at minimum wage every week during the school year.

The “back in my day” narrative is tempting on the surface. Many students in prior generations were able to work moderate hours and attend school full-time, graduating on time and with little to no debt. Today’s students face a much different scenario, with significantly higher total costs of attendance, largely due to rising housing costs. The state’s financial aid program has done a good job of keeping up with tuition increases, but resources for students’ basic needs like food and housing are insufficient and serve as barriers to higher education. Policymakers should consider the economic context in which today’s students live, work, and attend school when discussing college access and affordability. The “back in my day” narrative is useful if it is intended to call attention to the changing affordability challenges facing today’s students and if it helps advance policy solutions to address those challenges. However, that narrative can be counterproductive if it provokes questions about whether today’s students are working hard enough or are committed enough to achieving a higher education.  California’s landscape has changed significantly in the past 40 years, and our policies should reflect an understanding of those changes and a commitment to ensuring all students have the opportunity to pursue a college degree.

— Amy Rose

Aureo Mesquita provided research assistance on this blog post.