How public college spending is impacting tuition costs

U.S. college tuition has increased, with the average costs rising to $9,678 for in-state public colleges per year and $27,091 for out-of-state public colleges per year, according to Education Data Initiative. One of the contributing factors to the rise in college tuition is educational institutions spending more money. In two decades, public college spending has risen 38%, according to the Wall Street Journal. Wall Street Journal Reporter Melissa Korn joins Yahoo Finance Live to talk about the increase in public college spending, stating that it "really ramped up between 2002 and 2012. It did slow down in more recent years, in part, because of the pandemic and financial pressures and pressures from the state houses of these schools, but it hasn’t stopped, it hasn’t declined generally." Korn notes that "a very common refrain you hear from university presidents" is that "the state’s cut our funding, we need to raise tuition, it’s our only option." Korn reiterates that public universities are gaining $2.40 in tuition revenue for every dollar of federal funding lost.

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