Why College is so Expensive

Why College is so Expensive

College is expensive. Like, really expensive.
Especially here… in the Unites States of guns, fast food, and student debt. It wasn’t
always this way. In 1980, the average cost of tuition for one year at a four year private
college was $3,500. Adjusted for inflation, that’s $10,200 2016 dollars. Today, that
same year of college goes for $32,000—3 times as much as only 36 years ago. So what’s
behind this? Well that’s both a complicated and controversial question.
To understand why college has risen in cost we first have to understand why college has
always been expensive. The biggest fraction of your tuition goes to salaries. The national
average student to faculty ratio is 18 to 1 meaning that for every 18 students there
is 1 faculty member. The average professor at a private college makes $126,981 per year.
Divided by 18 that comes out to only $7,054 which doesn’t seem that bad but you have
to consider that there’s more than just faculty. There’s also coaches, and gardeners
and kitchen staff and dorm staff and maintenance people and admissions staff and marketers
and IT staff and security guards and college presidents. All together, the salaries and
benefits of all these individuals add up to a whopping $24,000 of our $32,000 tuition.
Salaries tend to be high because college functions similarly to many other industries—following
the rules of supply and demand. The most popular college majors vary over time because interests
change to reflect changes in culture. The problem is, you can’t just magically create
new professors. By the time new professors go through their 20 years of education and
specialize in a field, that major will no longer be the popular one so when a major
is popular, colleges have to compete to get professors and the only thing that really
matters is money—money brings more professors, more professors brings more students, and
more students brings more money. At the same time, professors in historically popular majors
receive tenure. Tenure is the idea that in order to promote academic freedom, long-time
professors should have their job guaranteed until retirement. With professors that legally
cannot be let go, there can often be an abundance of professors in less popular study areas.
So, we still have $8,000 of tuition unaccounted for. Colleges need places to teach and their
infrastructure is rather unnaturally expensive. Classes usually only run for eight or ten
hours a day, five days a week, for 40 or so weeks a year. That means that classrooms are
only in use 23% of the time. The college still has to pay for the space the other 77% of
the time which of course adds up. Additionally, colleges really like to build nice buildings
because these attract students. The average cost to build a building varies by location,
but it averages between $115 and $215 per square foot. By contrast, U-Mass Amherst’s
Commonwealth Honors College cost $354 per square foot, U-Mass Boston’s General Academic
Building No. 1 cost $594 per square foot, and Berkely’s Lower Sproul Building cost
$659 per square foot. Of course there are other factors contributing
to the high price of college, but staffing and buildings are the big two. Now for the
reason college has tripled in price. It’s always been expensive to pay highly educated
people to teach in inefficiently used buildings so what has changed in the last thirty years?
Well, college is more popular than ever. In the last 20 years, college enrollment has
increased by 50%. Federal and state funding for colleges has actually increased to an
all time high since 1980 but with the simultaneous increase in students, per-student funding
has hit an all time low. In 1990, Ohio’s flagship public university—Ohio State University—paid
for 25% of their budget with government money while in 2012, only 7% of their budget was
paid for by the state. With less federal and state money, students have to pay more out
of pocket to make up the difference. Additionally, colleges have changed to appeal to the millennial
generation. According to William Strauss and Neil Howe, the millennial generation—born
between 1982 and 2004—are characterized by seven core traits: they are sheltered,
confident, team-oriented, conventional, pressured, achieving, and they feel special. Sometimes
called “trophy kids,” millennials tend to be more ambitious and feel more unique
than the preceding generation which means that they tend to believe more in “the right
fit” idea for college. Colleges responded to this new attitude by adding more and more
amenities to help them stand out to the growing number of students. All these new amenities
required more and more management which contributed to the boom in administration at universities.
According to the US Department of Education, the number of administrator positions increased
60% between 1993 and 2009 which is 10 times faster than the number of tenured professor
positions. So just as I finished my “Why Flying is
so Expensive” video by telling you that flying is not that expensive, I’ll finish
this video by telling you that college is not that expensive. 85 percent of full-time
degree seeking students at four year universities receive some sort of financial aid with the
average grant hovering around $15,500. That’s a significant amount, but I’ll admit there’s
still a significant amount left over, until you consider that going to college is the
single greatest investment you can make in your life, especially today. People who go
to college earn on average 98% more per hour than those who only have a high school diploma
and that number is up from only 40% more 35 years ago. So given that, what’s the true
cost of college? When you look at it holistically, over your whole life, the cost of going to
college is not $32,000 a year or $128,000 over four years, but rather negative $500,000.
By skipping the opportunity to go to college, you will forfeit on average half a million
dollars in potential earnings. Go to college kids.
Thank you for watching! I’m very excited to say for the first time ever… this video
is sponsored by audible.com. Audible is a company that I admire a lot and have used
for years before this sponsorship. As I imagine any subscriber of Wendover Productions does
too, I love learning and a great way to learn is through reading books. The problem is,
I live a busy life and rarely have time to sit down and read a book. Instead I fit reading
into my schedule by listening to books when driving, doing dishes, running, whenever.
Audible has an amazing selection of 250,000 titles including one of the best non-fiction
books of all time and a personal favorite of mine, Freakonomics which can be yours,
for free, forever, by signing up for a 30 day free trial using the link www.audible.com/wendover.
Alternatively, you can download any other book for free with that free trial. Using
that link to sign up for a free trial is the single biggest way you can help support Wendover
Productions so I do hope you consider it. Aside from that, you can subscribe to this
channel if you haven’t already by clicking the button here, or follow me on twitter @WendoverPro.
You can also check out last week’s video on Dagen H—the day Sweden switched driving
directions—here. Thank you again and I’ll see you soon for another Wendover Productions

100 thoughts on “Why College is so Expensive

  1. In my school, there were professors making $40-60k a year, with 300 students in the classroom, paying $4k in state and $25-40k out of state, with Teacher's assistants and graders working with government grants as a part of their Gradschool Work-Study participation. My school was run like a private business for maximum profit. There was very little in the way of useful to life or research information. It was all very compartmentalized knowledge that would only serve a person in hypothetical situations, or super-niche areas of study, like Mathematical Homomorphic Rings, or Ancient Mayan Runes.

  2. 1:19 looks EXACTLY like where I went to college, but it isn't because there was no water behind those 2 buildings 0.o okay, I'm officially weirded out.

  3. The reason that college graduates make much more money compared to high school is because more jobs are now asking for a college degree when in the past one could get the job without a college degree.

  4. If you’re debating on going to a community college or a university, please check out my most recent video. Don’t let anyone tell you community college isn’t good enough. Congrats to you on whichever path you take!

  5. College is more expensive because business people figured out that Colleges could make them big money! Money rules the world! Now making money is more important than being an institution of higher learning!

  6. Switzerland has, in my opinion, the best education system. You do apprenticeships and even then you can still go to Uni. University doesn't cost that much according to what i've heard. it should hover about 500 to 1000 chf. OF COURSE, you do need to factor in living costs etc. so it would be more or less 10'000 a year. A YEAR.

  7. Switzerland has, in my opinion, the best education system. You do apprenticeships and even then you can still go to Uni. University doesn't cost that much according to what i've heard. it should hover about 500 to 1000 chf. OF COURSE, you do need to factor in living costs etc. so it would be more or less 10'000 a year. A YEAR.

  8. college presider salary : 240K+
    that's a rip off. they make more money than even doctors. what?? for doing what exactly??

  9. Tenure is the greatest disaster to ever happen to education. Once tenured the Professor is automatically exempt from losing their job due to sloth, dishonesty, or poor attitude. Eliminate tenure and teach unions and watch costs drop in real time

  10. The most frustrating part of this video is the definition of 'millennial.' The oldest 'millennials' could literally be parents to the youngest 'millennials.'

  11. No one mentioned the fact that in nearly every state the highest paid public employees are coaches of either football or basketball. Their salaries also rise regularly.

  12. College is the single best investment you can make in life does not justify how it can be this expensive. It does not. It never will. Why? Students living in countries with free education enjoy this benefit too. Maybe schools there won't spend that much on a football coach or a football field.

  13. You cant miss out on 500k per year if alot of people dont even make a million dollars in a lifetime. So if everyone went to a small debt of 32k then most would make 500k a year i dont know this makes me question where you get your statistics .Theres a ton of factors that affect the answer to wether college is worth it or not.

  14. This made me wonder where you get your statistics and wether all of your videos have been really off, still, great videos!

  15. Don't just go to college! Have a game plan on what you want to do! If it is to make money, be a software engineer while you don't necessarily need a degree still make decent money! And or other careers don't necessarily need a degree.

  16. Cough Bernie fixes this with a .1% tax on wall st bonds and .5% on trades. Ending Wall ST speculation and getting rid of all student debt in the country while making college tuition free. This doesn't raise taxes a dime as well! Time for Wall ST to pay back their BS bailout!

  17. Robert kiyosaki would disagree that college is the single most important investment u can make in ur life. The most important investment you can make in your life is in your financial education, not in your academic education

  18. Wendover just made collage degrees less valuable and more expensive to get , by telling EVERYONE needs it

  19. if there was a tenure program for college graduates that guaranteed sufficient income once school's done, then it would be the best investment you can make. unfortunately there's no guarantee you'll find a good-paying job in your field once you graduate, and there's a growing and very real risk that it would have been a total waste of 4+ years. a wide enough margin of graduates leave college owing tens of thousands of dollars they'll be stuck paying back plus interest while they slave away at a $13/hr job for 10 years until you gain enough experience in something to make a decent salary. yes your chances of getting a high-paying job are obviously better if you have a degree, but the risk of not achieving that is getting bigger every year.

  20. Building more schools AND informing the people of certain career paths that college isn’t worth it…THAT solves this situation

  21. Loans aren't the problem the COST of college is the problem. College is a feeding frenzy of insider connected leeches upon a captive audience. People make great money from college, just not the people paying to go there. :-/

  22. College is so expensive for ONE SINGLE REASON – overpriced, unearned HYPERINFLATED pensions of the administrators, university employees & professors. That’s it – not complicated at all. Fix it.

  23. you dont have to go to college/university to make good money, trades can earn more than college graduates, there is also a need for certain trades which brings more money

  24. Don't go college ….just have good laptop and hight speed WiFi…
    U will learn more then college…+ Huge savings

  25. Want a decent education just buy the book and applied it how about worthless degrees I'm a drop out more than once my greatest schooling came out of wall St computer

  26. While this was a good example for 2016, tenure has actually been changing in recent years. You should update this. Professors are no longer guaranteed their tenure even after achieving it. They are put up for “review” by the administration every now and then and if they disagree with them they can loose their tenure. It’s a corrupt system that discourages changes in how we learn and teach at the collegiate level.

  27. People should research the Bennett Hypothesis and how government subsidies most likely attributed to the rising costs. Back in the day a person could work a part-time job while going to college… not anymore thanks to government interference. Also, don't go to college kids if you can't afford it. Instead go to trade school for a fraction of the cost and make $20 – $60 an hour being an electrician, carpenter, construction worker, roofer, or some other skilled laborer… they are higher in demand since nobody wants to get their hands dirty anymore. Or start your own business since we have a ton of free education online now-a-days.

  28. I was ok with everything except the part where he said " go to college ". It really depends on that college & degree whether it makes economic sense.

  29. The production of this video was very well done, and the direct actual facts you gave were interesting and helpful which I appreciate. However, I find your ending gross, misguided, and dangerous. To say that college, accross the board, is an investment with a guaranteed net gain is just factually incorrect. Yes, college is an investment, often a necessary one. But as an investment, college is not exempt from the risks of any other huge investments. People are not guaranteed an increase in earnings just for having the degree. More often than ever, graduates are ending up in jobs that don't even require a degree in the first place, or are being underpaid for jobs that do. And it's largely because of the issues presented in this video of too many students enrolling because people like you act like there's no viable alternatives and that people who try something other than college are making a bad decision. I would think as a channel that appears to often focus on financial issues, you would know better than to assume any investment of 1000's of dollars just for one thing is "safe" with a definite net gain.

  30. I disagree on your conclusion.

    Internet is a new element on this equation. Is it worhy to make such sacrifice to manage to pay the tuition? When there is an endless source of knowledge and wisdom on internet.

    Honestly USD 128K?

    In the coming years we are going to see how companies will gradually care less about diplomas and more about actual skills. Several tech companies have already started considering this issue.

    Does US college prepare students for the real corporate world or they just give lectures of theorical concepts? (I am not from US, just asking). In Europe, and specially my country, Spain, both public and private institutions have completely failed in doing so. Even in our country, where studying is relatively cheap it is not a worthy investment (measured in time in this case).

  31. HOLD IT !!!!!!! The reason college is so damn expensive is because OF govt STUDENT LOANS.Before gov't student loans, kids worked at the college, or they borrowed the money from a bank etc. Along comes the gov't student loans, and colleges hit the lottery.NOW they can set the costs as high as they want, because they know the kids will just get a gov't loan and pay what ever the cost is. In just a few years the coat of a college degree went from being reasonable to CRAZY…..college costs went up WAY faster than the cost of living because the schools could soak the hell out of the kids and the Gov't money was there. they were and are GREEDY!!!! Elizabeth Warren bitches about the cost of college but she is paid over $420,000 AS A HARVARD PROFESSOR AND SHE ONLY TAUGHT 2 CLASSES A YEAR !!!!!. AND SHE HAS THE BALLS TO BITCH ABOUT THE COSTS ???????

  32. i dont like this vidio
    im 22 making 50k a year with no college education, living in a home worth 300k that i purchased
    college isnt what makes you great

  33. This video is sponsored by Notre Dame University check it out they’ve got swimming pools the movie Rudy and some pretty nice beer

  34. The problem is unnecessary infrastructure. Large universities get grant money from the government, but rather than using that money to pay staff and assist with current maintenance they just add new crap. During the 3 and a half years it took me to earn my bachelors of science in communications, the University I attended (Austin Peay State University) had 2 major projects that seem quite wasteful. First being luxury booths at the football stadium. Since very few people put in the massive amount of money to buy a ticket to use one during any game, just 1 or 2 would be used at a time and there were about 14 booths total. Another being a second art building right next to the old one, the first art building wasn't getting much action to being with (most APSU students have a tendency to put more emphasis on science rather than art) and now there is a second gleaming building which also has very few classes taking place in it.
    Now that those extra buildings that are kinda pointless were built and the college needs to buy materials to help with maintenance like cleaning equipment, repair tools and they need to hire extra staff to maintain the new areas as well as buy more electricity, water and sewage for the buildings. Where are those extra costs added? You guess it, to admission.

    And APSU is just a moderate example, last year Oregon State University added some glass panels to surround their track stadium. Sure I guess it looks pretty buy how do "glass panels" improve a student's education? It doesn't, but the student is paying extra to maintain them.

  35. College was cheap until the Governemnt got involved in the 60s/70s. Politicians started guaranteeing student loans and financial aid of any amount to anyone that wanted to go to college. Bc the govt guaranteed all the loans, it allowed colleges to charge however much they want bc they know the kids will pay it since govt is writing the check on behalf of the kids. Healthcare is so expensive now for the same reason. Govt gets involved and guarantees it to everyone no matter the cost, which allows hospitals to charge whatever the want. If governemnt completely got out, then prices would plummet. People would no longer be able to afford college/healthcare at these prices, so if government can’t pick up these tabs, prices would be forced down if hospitals and colleges wanted any customers at all.

  36. The real reason why college is so expensive is because the federal government now backs 90% of the loans which means more people are going to college in colleges are artificially inflating their cost ie fucking us all

  37. 0:12 is that SCSU? St. Cloud State University. St.Cloud, Minnesota?
    Must be, the school logo is noticeable under the blurry image on the lamp.

  38. I despise how most people here in America will treat you like you're scum or lazy if you don't have a college degree. It's VERY stressful and it's driven so many students to the brink of insanity.

  39. The student loans need to stop. Your granting a potential unlimited amount of money to an 18 year old kid with no credit what so ever. The dumbest bankers in the world wouldn’t even do this.

    If they stop with this, college tuition is going to become so expensive that no one will attend. Therefore there tuition and interest rates WILL drop.

    The govt is putting money in the hands of CHILDREN in the HOPES that they will make a half decent living and pay off this massive dept.

  40. Yeah remember paying obscene amounts of money to go to a LibTard indoctrination camp is the single greatest investment you can make. Also the coveted ability to say I'm smarter than you I went to college.

  41. The thing is, I will gladly move abroad for a more cheap and affordable college, the problem is I will be away from my family and I will know nobody

  42. "go to college kids" "going to college is the single biggest investment you can make in your life". Thanks to advices like this you can come in Bulgaria and see psychologists, historians and etc selling you groceries. College is not for everyone and recent tendency of employers to ask for bachelor's degrees for jobs which clearly don't require it helps making the situation worse. For example an office manager (the person who picks up who phones and arranges the schedule for the superior) doesn't necessarily require a college degree. You may ask for foreign languages but bachelor's degree is an overkill. And employers do require college degree sometimes they don't even point an area of specialty, they just say "a bachelor's degree is required".
    That makes young people to jump at some topics which are easier than others to graduate (public administration vs engineering or medical, you get the idea) and spend 4 years of their life for nothing

  43. yeah there's more people in colleges that's why it's more expensive… Not like in canada where our student population didn't boom at all and we pay waaaaay less than you

  44. I am a millennial of 1985 and I do not feel like that. I also don't agree with the idea that college is the single largest investment in your life; marriage and parenthood is the single largest investment.

Leave a Reply

Your email address will not be published. Required fields are marked *