High Cost of Higher Education in America

The significance of higher education cannot be overestimated; however, many American students are facing the issue of not being able to afford it. For this reason, they have to take a loan with the expectation to repay it after graduation. Nevertheless, a diploma does not necessarily guarantee a high-paying job; therefore, young people have a number of difficulties paying off this loan. This issue is considered to be one of the most relevant problems among students in the U.S., which raises various discussions.

There is an apparent need for policy changes so that higher education could become more affordable. Therefore, high cost of higher education facilitates ever-increasing student loan debt, financial burden, disincentive for entrepreneurship, and generation-based division.

The main issue of high cost of higher education is the fact that debt amount is on the rise. There are several reasons that contribute to the given problem, including high unemployment rates and low demand for specialists with a diploma. At the same time, the student loan debt not only stays at high levels but also increases every year (Bricker et al., 2015).

In other words, one can argue that there is a strong detachment or disconnect between the economic incentives of a job market and educational facilities. An institution of higher education should prepare students for employment by making them competent and relevant, but the financial motivation for such organizations hinders their capability to represent the realities of the job market.

Universities are willing to accept more students and provide a wide range of degree options in order to remain attractive and profitable. It means that these institutions have a higher demand for students because they treat them as customers instead of treating them as the product of their education. In turn, it leads to a high influx of students to the colleges and universities, who will take student loans to be able to afford the degree. Therefore, such loans continue to increase alongside the high demand for education, which is reflective of the specialty demand in the job market.

However, the shifts and gradual changes in the job market can make that it might not need certain specialties. Therefore, an increased supply of these unneeded occupations will inevitably lead to the fact that there will be a mismatch between supply and demand metrics. In addition, there will be a sharp increase in unemployment rates and a decrease in salaries. It is clear that a high level of supply and a low level of demand will drive the price or value down, which is manifested in the worker wages.

The growth of a healthy middle class and the financial stability of an individual can be severely hindered by debt. Some researchers agree that these issues force young people into a long debt, disrupt their opportunities for success, and make “college a poor value proposition for many families” (Barry & Dannenberg, 2016, p. 4).

It is important to understand that there is an expected value of any investment, and education can be considered as such an instrument, which needs to bring returns in the future. Regardless of student loans, diploma acquisition is a process, which requires both time and resources, which could have been allocated elsewhere. In other words, the expected outcome of a degree might not be positive for a student, but it is so for the university. Therefore, in a hypothetical country, where education is completely free, going to a university might skill not be attractive if one considers its expected value in the future.

However, adding the concept of student debt makes the given metric less appealing. It becomes a heavy burden on the young and fresh workforce, who need to build some level of wealth in order to create a strong middle class. The fact that they are forced to pay out their student loans after graduation severely hinders their earning potential and limits their opportunities for success.

The situation is worse for specialties with a lower job market demand. In other words, some occupations might have higher levels of unemployment, where student debt is impossible to be paid back. These individuals will be not only able to remain at their socioeconomic status but also experience financial disruptions, which will echo towards the families and friends. They will become a burden to their communities and nation because poverty leads to top crime, substance abuse, and other social problems.

The high cost of higher education can also act as a system with an increased penalization. Thus, another justification for changes is that a high price for a college provides a greater risk for students to get a disincentive and a penalty (Glater, 2015). Businesses and entrepreneurs play a vital role in ensuring the economic growth and prosperity of a nation. It is especially true in regards to small and middle-sized companies, which employ the majority of the country’s workers and makes a significant portion of employers.

Students burdened with student debt are unable to take entrepreneurial risks by opening or starting new businesses. The main reason is that student loans make them highly risk-averse, which limits them to more secure but less rewarding employment options. Although workers generate value in the market, it is evident that more value and wealth can be created through entrepreneurship rather than being a mere employee. Therefore, it is evident that such an education system punishes or penalizes students from becoming entrepreneurs.

Moreover, it is critical to note that earlier generations had better opportunities in comparison to later ones. The difference between household earnings and the amount of debt creates a divide between generations (Elliott & Lewis, 2015). Such a distinction is manifested in the fact that older people are able to occupy better positions by default due to their experience. However, the issue is aggravated by the notion of debt, where younger workers need to acquire work experience as well as pay out their debt.

The given pressure is doubled by such a system, which was not the case for older generations. The lack of competition from younger individuals makes it easier for older ones to continue building their wealth through the acquisition of valuable assets and properties. The prices for these investments is also lowered because younger generations are unable even to consider purchasing them, which reduces demand and cost. Therefore, older generations are able to become wealthier even faster, because there is no competition from younger people.

In addition, the high costs prevent academically talented students from acquiring the knowledge and qualification that they need to progress in their field of study. Thus, this is not just about socialization and learning, but about the acquisition of professional knowledge and skills by an individual, but about mass and large-scale higher education as an organized constant social process. It is about a system built into the economic and social structure of modern society.

Being placed in a system that has all the features and characteristics of a production organization, the process of education manifests its essence as a process of forming certain traits of an individual that society has considered necessary for its reproduction. What, before the emergence of a constantly working mass system of higher education, seemed to be a more or less free process of socialization, becomes, in the case of mass organized education, a production process that processes the resources involved into a certain product.

It is critically important to address the counter claims, which are mostly focused on the quality aspect of education. One might argue that high cost of education is due to an increased quality and other improvements. Even if this is true, such enhancements are not necessary if the university programs are based on job market demands, and students are burdened with debt. In addition, by observing the majority of higher education facilities, the costs are mostly driven administrative segment, and not by faculty or research.

In conclusion, high cost of higher education promotes generational divide, disincentive for entrepreneurship, financial burden, and increased debt. It would appear that college debt seriously affects the well-being of students in a negative way. Young people are burdened by it even after acquiring their diploma. Many families start to question whether saving money for higher education is worth the risk since it never stops rising.

For this reason, policymakers should consider making changes so that America will not lose skilled professionals who could not afford to go to college. The problems of the modern education system can be summarized in several points. These are conditions conducive to the splitting of the educational process into the training itself and the creation of an educated and professional personality, and into the process of producing certificates and formal indicators.

There are commercialization and formalization of the process of creating cultural capital within the educational system. This leads to the emasculation of the socially significant, actually intellectual component of education as a cultural capital while maintaining its economic significance. These problems determine the functioning of education as fictitious capital in parallel or even due to its existence as a sphere of production of the real cultural money of society.


Barry, M. N., & Dannenberg, M. (2016). Out of pocket: The high cost of inadequate high schools and high school student achievement on college affordability. Education Reform Now. Web.

Bricker, J., Brown, M., Hannon, S., & Pence, K. M. (2015). How much student debt is out there? FEDS Notes, 8, 7.

Elliott, W., & Lewis, M. (2015). Student debt effects on financial well‐being: Research and policy implications. Journal of Economic Surveys, 29(4), 614-636.

Glater, J. D. (2015). Student debt and higher education risk. California Law Review, 103, 1561.

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1. ChalkyPapers. "High Cost of Higher Education in America." October 12, 2023. https://chalkypapers.com/high-cost-of-higher-education-in-america/.


ChalkyPapers. "High Cost of Higher Education in America." October 12, 2023. https://chalkypapers.com/high-cost-of-higher-education-in-america/.