Tuition increase in context

April 7, 2014 | 11 a.m.

College: Is it worth it?

News | Michael Urch

Bethel is increasing its tuition 3.86 percent next year. With rising tuition prices, it is becoming more and more difficult to afford college. How much is college really worth? Is Bethel worth the price tag?

This price tag can be deceiving. According to Chuck Hannema, finance professor and budget committee member, 30 percent of gross tuition dollars are given in aid on average. This means that, on average, students would pay $24,000 instead of a marked $32,000 per year, not including scholarships and grants received outside of Bethel.

“This is the model we think works,” said Hannema. “[Bethel] needs a bigger reputation in the marketplace.”
Even with the scholarships, students are paying more than $24,000 per year for tuition alone. Financially, is it worth that much money? How will a college education influence an individual’s opportunities in the job market?

“College graduates consistently have lower unemployment and higher wages [than high-school graduates],” said Randy Bergen, executive assistant to Jay Barnes. “The earning power of graduates is [also] dramatically increased.”

Bachelor’s degree students have 1.63 times the earning power of high school graduates, and they have an unemployment rate of 4 percent compared to high school graduates at 8.3 percent, according to the College Board’s report “Education Pays.”

Regardless, quantitative analysis is not the only form of value received through a college education. There are some qualitative factors that ought to be considered. Things such as relational, emotional and spiritual growth are difficult to quantify, but they are benefits that can be received from college.

“I really think you need to take a look at the qualitative side,” said Hannema. “What does college do for you from a social, from a spiritual, from an emotional perspective—that doesn’t happen elsewhere?”

As a small Christian liberal arts school, Bethel has a very high tuition cost, but it also offers opportunities that are not necessarily available at larger universities. Writing, math, science and business tutors are available for free. Students from multiple disciplines can be involved in music, sports and a multitude of other organizations. These things, among others, create opportunities to form great friendships and to achieve personal growth.

Thinking only of keeping expenses low can be a dangerous mindset. Instead of investing in something of value, one could mistakenly spend good money on something of little value. It is important to not only consider the costs, but to also consider the different benefits received in order to make an informed decision weighing the costs and benefits.

“Having the lowest financial costs does not necessarily guarantee a good education and a good job,” said Hannema.

Many things should be taken into account before making an informed decision about whether the costs of college are worth the benefits. For those who have already come to Bethel, the question becomes: are you taking advantage of the benefits Bethel provides? Don’t waste the opportunities here. After all, you’re paying for them.

Tuition beats inflation: A benchmark with a disclaimer

Since 1988, Bethel’s tuition, like most United States upper-level education tuition, has consistently risen at a faster rate than inflation. If we wanted to invest in bonds that would beat inflation, this would be great. Unfortunately, tuition rate increases are not so great. Why is it that tuition continues to increase more than inflation?

“It’s one gauge, but it’s not perfectly correlated,” said Hannema.

Tuition is one of the main components of Bethel’s revenue. According Bergen, student tuition and housing expenses combined equal around 90 percent of Bethel’s revenue. Bethel is a tuition-funded instituti on, and the price set for tuition is extraordinarily important to sustain Bethel.

According to Hannema, the budgeting committee creates three scenarios in order to choose tuition prices. When examining student enrollment, they have a pessimistic scenaria, a most likely scenaria and realistc scenaria about the number of students they expect to come to Bethel. They set the tuition prices based on this analysis in order to be able to cover expenses.

Bethel has been making efforts to control expenses, but the reality is that expense increases rise faster than inflation; therefore, so does tuition. According to Bergen, the three largest expense increases for next year will be scholarship increases, position replacement and employee health care.

“We always want to keep the increases as low as possible,” said Bergen. “Bethel students are paying for it, and we know it is expensive.”

Tuition must be increased so that Bethel can cover its expenses.

“The most expensive thing in education is to pay for the people who provide it,” said Bergen.

According to Bergen, more than 60 percent of the budget pays for faculty and staff . If the students at Bethel have suffered from tuition increases, the financial situation of the faculty and staff has been worse. It has been two years since anyone has received a raise, the retirement packages have been lessened, and there continues to be conversation about health insurance expenses.

“Staff and faculty are getting burnt out, and that is not sustainable,” said Hannema. Faculty and staff are becoming over-extended to cover for cut positions while receiving the same level of compensation.

If we believe that the expenses of upper-level education are worth its benefits, Bethel tuition payers must realize that costs will increase with the expenses, and the students are not the only ones impacted. Without tuition increases to cover expenses, the valuable staff and faculty support could become difficult to retain.


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