Why are liberal arts colleges so expensive?

[bump]

@senoy

Look at the ‘hockey stick graph’ of college costs and you’ll see that the bend of the stick starts almost as soon as the US News Rankings existed (about 1985, give or take.) If you want to know why college is expensive, that tells a large part of the story.

Private schools have always been considerably more expensive than public schools, and a big part of that is because most state schools are/were either endowed by the states or are directly subsidized.

The question is really why there’s nearly a 2x price to go to Sewanee vs. the University of Tennessee, and whether that reason is due to state subsidies, or if there’s some element of Sewanee charging what the market will bear, and then offering a lot of financial aid to entice more price-sensitive students to attend.

And Dinsdale, a lot of that impersonality is really only in your first couple of years. In most programs, when you’re an upperclassman, you’re not in classes of hundreds- maybe 30-50 at most, and often with the same professors you’ve already had. And most people build their own communities, whether it’s through their dorm, student clubs, major, church, Greek organization or whatever. Hell, some people created little communities based on their part-time jobs- there was a gang of people who worked for the college IT department, and a group of waiters/waitresses/bartenders, and the RA/RD crowd, etc… It’s not uncommon to overlap either.

[Voyager]

@Dinsdale

I was speaking with a co-worker whose son is a HS senior. She said he just was accepted into William and Mary, to study history, and it might cost $60k/year.

Now William and Mary and other “historic” colleges might have some special cachet warranting an elite tuition. But it made me wonder why there couldn’t be low cost liberal arts colleges.

My wife went to William and Mary in Biology. As for the cost, it is the same as the reason hotel taxes are high - those who pay it aren’t voters. Many state schools (those in California included) increase the price for out of state students.

However, a quick google came up with this:

The undergraduate 2019-2020 estimated tuition & fees at College of William and Mary is $26,991 for in-state and $46,933 for out-of-state students. For Graduate School, in-state tuition and fees are $15,760 and out-of-state tuition and fees are $32,782 for academic year 2018-2019

I guess food and lodging could be $16K.

I believe W&M has a good reputation for history, for obvious reasons.

[kenobi_65]

@Voyager

The undergraduate 2019-2020 estimated tuition & fees at College of William and Mary is $26,991 for in-state and $46,933 for out-of-state students. For Graduate School, in-state tuition and fees are $15,760 and out-of-state tuition and fees are $32,782 for academic year 2018-2019

I guess food and lodging could be $16K.

Dorm housing is $3700 - $4700, per semester, so that’s $7400 to $9400 for a year.

A freshman meal plan is $2500 per semester, so that’s another $5000 for a year.

Assuming the least-expensive housing, that’s about $59,000 for the freshman year (and I suspect that’s still not counting books). So, the OP’s mention of “it might cost $60k/year” seems to be spot on.

[Exapno_Mapcase]

Just for context, I applied to colleges in 1968. Being from a really poor family I couldn’t go at all unless I got a free ride. The University of Rochester offered me one, tuition, room and board that would supplement other scholarships I had. The year’s cost: $3400.

On the flip side, costs went up the next year and they lowered my benefits. Once your fish is on the line …

[Ukulele_Ike]

Banjo camp, eh?

Well, I suppose there’s lots of kindling for the campfires.

[Kimstu]

@Dinsdale

(Olivet College BTW).

Olivet College is a private Christian liberal arts college affiliated with the United Church of Christ. The hundreds of tiny religiously-affiliated liberal arts colleges in the US are generally quite different in focus from secular academic institutions like William and Mary, and tend to serve a different demographic.

If you look at the list of majors offered by Olivet, you’ll notice that about half of them are in quasi-vocational subjects like Actuarial Science, Business Administration, Business Analysis in Insurance, Criminal Justice, Exercise Science, Financial Planning, Fitness Management, Insurance and Risk Management, Sports/Recreation Management, etc. These are not traditional liberal arts disciplines; this is a curriculum that’s a hybrid of traditional liberal arts with business/technical training and certification programs. Nothing wrong with that of course, but it doesn’t really make for a meaningful comparison with what we usually think of as a “liberal arts college” in the US.

[Dinsdale]

@Ukulele_Ike

Banjo camp, eh?

Well, I suppose there’s lots of kindling for the campfires.

You want kindling? Well, my main instrument is upright bass!

And I didn’t mean to dump excessively on Olivet. I REALLY appreciate it for hosting this music camp. I guess a part of my impression was colored by my expectations, experiences, and biases.

I attended UofI as did 2 of my kids. The 3d went to Illinois State. The all-in cost at Olivet was considerably higher than the costs at my state schools, so I tried to assess what that extra $ would get you. Sure, it is smaller, so I imagine there is greater access to faculty and other factors that would come with small size (if you consider those plusses). And for all I know, their faculty are world leaders in their fields (tho I doubt that.) I imagine they are very good teachers, interested in interacting with the students.

My impression of the dorms is undoubtedly colored by my 3-4 post-dorm decades living in far nicer surroundings. And I guess I’ve seen enough media articles about lavish dorm “suites” and such, that these little, somewhat worn and dated living cubes made an impression on me. The comment re: AC in Mich makes sense.

There may be 3 buildings that they say host classrooms, but believe me that there is one single 4 story building that hosts the vast majority of their classes. Nothing about that building is new or lavish. I admit that as a summer camper, I am familiar only with the dorms, the main instructional building, and the dining hall. I freely admit the food is GREAT! And I have ZERO experience with the student union, the rec facilities, etc. Those might be top notch for all I know.

The hundreds of tiny religiously-affiliated liberal arts colleges in the US are generally quite different in focus from secular academic institutions like William and Mary, and tend to serve a different demographic.

What is the demographic these colleges serve. Often I will be driving somewhere, and I’ll notice signs for a nearby college or university that I’ve never heard of before. I often wonder what would attract prospective students to attend such colleges - unless there were a specific major that school excelled in. I question whether these small schools would have fantastic reputations, extensive alumni networks, many seem to be in unattractive locations, etc. I guess the religious aspect is important to some people. But in most cases, to my jaded eye, a combination of local community colleges and state schools would generally be at least a comparable option, often at lower cost (at least as far as sticker price goes.)

Sorry I’m so ignorant about this - happy to have my ignorance dispelled.

[MandaJo]

Olivet has an average SAT score right at or a little below the national average. So they are attracting students who would not get into their state flagship, but could likely get into their local regional state school or community college. Their “Full pay” kids will be at the bottom of that range–so relatively wealthy kids who can’t even get into a regional public 4-year school and for whom the alternative is community college. The kids at the top of the range will likely get financial aid that makes it about the same price or a little less than the local regional, so they will be kids who just prefer the small, private school experience.

In both cases, they will be kids with similar goals to those going to the local regional–getting a 4-year degree that they can use to start a pretty middle-income job–teachers, accountants for local firms, managers for small companies, small-scale entrepreneurs, IT people, etc. A few will be aiming at professional school (Law, Medical, Vet).

There will be an additional population of very religious kids who parents would not consider sending them to a secular school. My sister-in-law graduated from a little women’s college like this and almost everyone majored in elementary education or music education because the expectation was mostly just that they would get married. The music major was so they could run the choir at their husband’s church; the elementary education was to either work a few years or to run the church daycare.

[Thudlow_Boink]

@Dinsdale

The all-in cost at Olivet was considerably higher than the costs at my state schools, so I tried to assess what that extra $ would get you.

Don’t assume a higher price gets you more.

1. As already noted in this thread, the “sticker price” is not what everyone actually pays.
2. What the students who go there pay is not a school’s only source of revenue. In particular, state schools get money from the state, so they don’t have to depend as much on tuition to cover their expenses.
3. A large school has certain economies of scale.
4. What a small college like Olivet offers isn’t objectively better, but it may be better or more attractive to some students than what a huge state university offers.

[MandaJo]

@bump

And Dinsdale, a lot of that impersonality is really only in your first couple of years. In most programs, when you’re an upperclassman, you’re not in classes of hundreds- maybe 30-50 at most, and often with the same professors you’ve already had. And most people build their own communities, whether it’s through their dorm, student clubs, major, church, Greek organization or whatever. Hell, some people created little communities based on their part-time jobs- there was a gang of people who worked for the college IT department, and a group of waiters/waitresses/bartenders, and the RA/RD crowd, etc… It’s not uncommon to overlap either.

That still doesn’t compare to the overwhelming community feel of a SLAC. At TAMU, you can find your people, yes–and a huge advantage is that there will be a group of Your People because there’s so many of every type.

At a SLAC, you see the same people in your classes that you see in your dorm lounge that you see in the dining hall that you see at the student production you attend that you see at the convenience store across the street that you see in the library that you see at the gym. For some people, frankly, this is nightmareish, because you can’t hide, you can’t have different versions of who you are and you can’t always find “your people”–it’s a tiny town. For others, it’s amazing, because you make friends/find your place super easily, it’s easy to be involved, and you don’t fall through the cracks.

PS, your boy was adorable last night.

[Dangerosa]

@MandaJo

That still doesn’t compare to the overwhelming community feel of a SLAC. At TAMU, you can find your people, yes–and a huge advantage is that there will be a group of Your People because there’s so many of every type.

At a SLAC, you see the same people in your classes that you see in your dorm lounge that you see in the dining hall that you see at the student production you attend that you see at the convenience store across the street that you see in the library that you see at the gym. For some people, frankly, this is nightmareish, because you can’t hide, you can’t have different versions of who you are and you can’t always find “your people”–it’s a tiny town. For others, it’s amazing, because you make friends/find your place super easily, it’s easy to be involved, and you don’t fall through the cracks.

PS, your boy was adorable last night.

I know you know this, but my daughter just finished her first year at Clark in Worcester MA. Its an expensive private SLAC (though for East Coast private SLACs its got a bargain sticker price). And so much this. We knew she needed a place she’d fit it. We knew she needed small class sizes (the average undergraduate class size is 21 - skewed by a few large lecture style intro courses and a few popular majors - most of her courses have been 12 - 16 students - and her major graduated six students last year). We knew she needed to not slip through the cracks and have relationships with professors. We knew she’d do better in seminar courses than in lectures. We knew she needed a functionally secular environment - there is no going to college to major in Music Education so you can sing in the church choir while raising your husband’s children for her. Clark was a good fit for her - students are quirky and liberal - she is quirky and liberal. They don’t have a football team, the kings of the campus are the Improv geeks. If you look at Niche the complaints about Clark are often that they don’t value athletics and don’t have a greek life or a party scene (and Worcester is a run down city - Clark is in a run down neighborhood in a run down city - and its COLD in Winter) She isn’t a sports loving sorority party girl - she’s been in run down neighborhoods (our suburb is economically diverse and inner ring) and she’s from Minnesota - she knows what cold is.

I went to the University of Minnesota at a time when it had 40k undergrads. … 600 person seminar courses. That makes it really difficult to find your spot - you may live on campus and never see your randomly assigned roommate outside of the dorms. And many students are commuters - so there is little opportunity to make human connections. I have no friends from college - I have friends I hung around with during college years but none of them that I met in college

We’d spent years saving for college, when it came down to it, we could pay sticker price for nearly whatever she wanted (she did get - and keep - a merit scholarship - that knocked the sticker price down 30% - warning to parents - evaluate the likelihood that your student will keep that merit aid if that is a deciding factor on your choice, if the GPA is set high and there is a required course completion that is high and the school is academically challenging for your kid - freshman year is TOUGH - you are learning to do college and you are learning to adult and be away from home). So the affordability situation was a lesser concern than making sure she found a school she’d be successful at…at successful is about more than getting the grades - its also about wanting to go back to your dorm and your friends after Christmas.

If we hadn’t saved - she’d have ended up at one of the smaller in state public schools - University of Minnesota Duluth perhaps, maybe Mankato State. But she’d also been the victim of horrible bullying in high school and she really wanted to be somewhere where she didn’t have to carry along the baggage other people had gifted her with in high school. And Minnesota has limited reciprocity (you can go to school in North Dakota!)

[Mr.Bill]

@senoy

US News and World Report - specifically College Rankings

College rankings created an arms race and their poor methodology made it worse. Typically how they work is not based on the quality of education provided, but rather the ‘outcomes.’ Outcomes are typically selectivity and graduation rates. What this means is that in order to raise your ranking, you basically have to attract the best students. Graduation rate highly correlates with high school GPA. High School GPA highly correlates with higher socio-economic status and either White or Asian. So rankings basically come down to ‘How can we get the wealthy White and Asian kids to come to our school?’ That means lots of things, but it typically takes the form of facilities and services. The days of 1970s and 80s cinder-block dorm rooms and group bathrooms are largely over. Residence halls have become resort communities. In the 1980s, the ‘rec center’ might have been a room in the basement of one of the dorms with a bike and a rack of dumbbells. Now, they are hundred million dollar facilities with climbing walls, multiple pools, hot tubs, indoor running tracks and amenities far beyond what existed 30 years ago. Wealthy White and Asian kids expect country club amenities and services, so universities have to provide them. They expect more tutors and more administrators to walk them through scheduling and there is a need for more hand-holding and that means more administrative staff.

Universities find themselves in the awkward position of not being able to say no. If say Penn State is to build a new 500 million dollar rec center, Ohio State can’t say “No, we’ll continue to provide a good education cheaply with no frills.” What would happen is that the wealthy kids would shift enrollment to Penn State and Ohio State would plummet in the rankings since they would now have to admit lower quality students who would graduate at lower rates. Despite the fact that they might have better professors and provide a better education, they would be a ‘worse school’ in the rankings just because they failed to attract wealthy Whites and Asians. That lower ranking then has a knock-on effect. Because it’s lower ranked, it becomes less prestigious, which means even fewer wealthy Whites and Asians want to attend and it could end up in a death spiral. So what do they do? They have to build the facilities. They have to offer the amenities.

Look at the ‘hockey stick graph’ of college costs and you’ll see that the bend of the stick starts almost as soon as the US News Rankings existed (about 1985, give or take.) If you want to know why college is expensive, that tells a large part of the story.

This is accurate.

And it’s not just rec centers. Consider dorms…

When I was in college 40 years ago, a typical dorm room was big enough to contain 2 twin size beds, 2 desks and sufficient space to walk between them. The bathroom and shower facilities were down the hall and served everybody on the floor (probably 100 or so students). In today’s dorms, students get suites with 3 or 4 bedrooms, a living room/lounge area, private kitchen and bathroom. Add in cable and high speed internet and probably a gym in the building. That’s got to cost a heck of a lot more to build and maintain than what I experienced. Someone’s got to pay for it all.

I presume it is similar for every aspect of the college experience.

[Dinsdale]

Gotta say, Manda Jo - thanks for sharing your obvious expertise!

[Kent_Clark]

Why are liberal arts colleges so expensive?

Because inexpensive liberal arts colleges are going out of business.

My daughter graduated from a small, but highly regarded (locally, at least) liberal arts school. The school was originally founded by Roman Catholic nuns (who still ran the high school next door) but it was secularized in the 1960s. It still had some vestige of the classic “small, religious college” feel, though.

My daughter graduated in 2005. By that time the school the school was doing everything possible to shed its reputation as a liberal arts school. The English department had historically been located in a “quaint” old house on campus. By the time my daughter got there, the roof and basement leaked, and of course, it had radiator heaters and window air conditioners. Meanwhile the School of Business was building a huge, multi-million dollar facility and there were plans to build a huge, multi-million dollar library.

William & Mary, Ivy League schools, etc. have a big enough reputation to attract liberal arts students no matter the cost. But (just to focus on St. Louis) Fontbonne (nationally known for music), Lindenwood, Maryville (nationally known for taking students who couldn’t get in to anywhere better, -or students who didn’t care about college at all - and doing a good job of polishing them,) Webster (nationally known for drama), etc. are shouting, “LOOK AT ME! I’m a business school. Honest!” And that’s where their development staff are putting their effort. Does the music department need new stands for sheet music? Write your own grant application.

[Voyager]

The bottom line is that the best school for any kid depends on the kid. My daughters, who have very different personalities, went to very different colleges, and would have hated going to the one the other went to. They both got a lot out of them, but that was because they took advantage of the opportunities offered. Both colleges were big enough/famous enough to have those opportunities.
Yeah, large schools have big classes - but many professors are open to working with a motivated undergrad. But the student had to push.
Or the place could be a big high school with dorms and beer and sex.

[Wendell_Wagner]

William and Mary is more than a random liberal arts college. It’s a very old college. In fact, it’s the second oldest college in the U.S.:

The 25 Oldest Colleges in America

It has a good reputation as a college with things like some of the best professors and the best students in the U.S. Those sorts of reputations are self-sustaining though. New applicants look at its past reputation and decide to apply there. People who just got their Ph.D.'s look at its past reputation and decide to apply for jobs there. Children of alumni get encouraged to apply there by their parents. So a college with a good past reputation tends to keep that reputation in the future.

Also, many of the students (at all the top colleges) come from very well off families. If your parents together make $500,000 a year, it’s not that big a deal for them to spend $40,000 a year for four years so that you can go to a top college. The $40,000 a year that the students from those families pay helps to allow students from much poorer families to go there. On the other hand, a student from a family where the parents make $40,000 a year can expect, if they can get into certain top colleges, to get scholarships that pay almost all their tuition, room and board, etc. The college will only get a few applicants from such families and will only accept a few of them, but they will pay almost everything for them with scholarships. I know it sounds strange, but if you come from a poor family and somehow, some way, you manage to get accepted at a top college, it’s possible that going there will be cheaper than going to a local community college when you take into account the financial aid you’ll be getting.

[MandaJo]

@Wendell_Wagner

William and Mary is more than a random liberal arts college. It’s a very old college. In fact, it’s the second oldest college in the U.S.:

The 25 Oldest Colleges in America

It has a good reputation as a college with things like some of the best professors and the best students in the U.S. Those sorts of reputations are self-sustaining though. New applicants look at its past reputation and decide to apply there. People who just got their Ph.D.'s look at its past reputation and decide to apply for jobs there. Children of alumni get encouraged to apply there by their parents. So a college with a good past reputation tends to keep that reputation in the future.

One thing that’s interesting, though, is that the reputation of a school doesn’t seem to have much to do with the cost. In terms of pure sticker price, SMU is as much as Harvard and more than MIT; Harvey Mudd is more than either of them. Once you reach “mid-range”, the private schools are almost all between $65-75k/year, total sticker price. The sort of little private school Dinsdale is talking about may be more like $40k.

It’s a really interesting fact that there is so little correlation between the competitiveness of a university and its sticker price (though again, with aid, actual price is a whole different thing). At the very least, you’d think schools on expensive real estate might cost more, on the theory that cost of living is just higher, but it’s not. Dartmouth and Cornell are more than Harvard or USC and the same price as Columbia.

Also, many of the students (at all the top colleges) come from very well off families. If your parents together make $500,000 a year, it’s not that big a deal for them to spend $40,000 a year for four years so that you can go to a top college. The $40,000 a year that the students from those families pay helps to allow students from much poorer families to go there. On the other hand, a student from a family where the parents make $40,000 a year can expect, if they can get into certain top colleges, to get scholarships that pay almost all their tuition, room and board, etc. The college will only get a few applicants from such families and will only accept a few of them, but they will pay almost everything for them with scholarships. I know it sounds strange, but if you come from a poor family and somehow, some way, you manage to get accepted at a top college, it’s possible that going there will be cheaper than going to a local community college when you take into account the financial aid you’ll be getting.

It’s absolutely true that a poor kid can find a top college cheaper than community college or a state school. I just want to point out that $40k is way, way low for full-pay.

This is why, for wealthy families, state schools ARE a bargain.

[Wendell_Wagner]

Thanks, Manda JO. I was just guessing when I used a figure of $40,000 for the amount that a top college would give you a full scholarship if your parents make that amount or less. Here’s a website that gives some more specific information. It says that the figure is between $54,000 and $65,000 at some selected top colleges:

https://www.collegeraptor.com/find-colleges/articles/affordability-college-cost/these-10-expensive-colleges-have-free-tuition-or-full-ride-scholarships-for-middle-class-families/

Note though that it calls it a full ride if the financial aid is for all of the tuition and room and board. There are families so poor that if you told them that absolutely everything would be paid for except the cost of the student traveling across the country to get to and from the college, they would say, “Well, we can’t afford it then.”

[MandaJo]

Top schools will negotiate, and the number they generally use is “estimated total cost of attendance”. It includes an allowance for travel, person expenses, and books. The 65-75k figure I quoted is for that total. Some schools even give a one-time lump sum cash payment to low income students to cover transition costs (generally a laptop and, in MA, a coat). I happen to know Amherst, Harvard, and MIT do this, and I think it’s becoming more common.

That said, a lot of schools have the philosophy that even super poor kids to have SOME skin in the game. That may mean a couple thousand in loans/year. Generally, after the first year, kids can use summer internship earnings to cover those. But in extraordinary situations, that’s always negotiable.

[LC_Strawhouse]

They’re paying for the peer group - future business contacts, potential spouses, etc.