Now that the U.S. Department of Education has released new data on financial aid for the 2011-12 school year, we can update our calculations that show what students actually pay: “net tuition.” Net tuition is the published tuition minus all grant aid. (Student loans are not subtracted because they have to be paid back.) The graph below shows the average published tuition starting in 1980-1981 and the average net tuition starting in 1999-2000 (the first year the government collected the grant data required to compute net tuition) for all 990 four-year colleges with data. We weight for enrollment to represent what the typical student pays.
It’s not exactly a secret that published tuition continues to increase, and the top line confirms that. What is surprising is the net tuition line. After reaching about $6,500 in 2008-09, massive increases in Pell grant funding drove net tuition down for the next two years (to around $6,000), and there was hope that the trend of rising net tuition had ended. No such luck. Instead, net tuition increased considerably in 2011-12 to $6,700.
To get a better look at what is happening with net tuition, the box plot below shows the distribution of net tuition among four-year colleges. Recall that for a box plot:
- The thick line in the box gives the median value.
- The upper and lower limits of the box are the 75th and 25th percentiles, which means that middle 50 percent of all observations fall within the box.
- The upper and lower “whiskers” give the range within which almost all data fall.
- Any points outside the “whiskers” are considered outliers.
Most of the findings from the last time we looked at net tuition still mostly hold: The range of net tuition has increased, and there are some colleges with negative net tuition (these students can use the rest of their grant money for other educational expenses like textbooks or room and board).
One thing that has changed, however, is the location of the red dots, or the enrollment-weighted average tuition, versus the line in the box, which shows median net tuition among colleges. Since 2002-03 the red dot has moved downward relative to the median line, slowly shifting from above the median at the beginning of the period to below the median line at the end. This indicates that students were disproportionately switching to lower cost colleges. Whether this trend plateaus, continues, or reverses has important implications for many colleges, and the 2011-12 data suggest that drops in enrollment-weighted average tuition may have stopped.