Seems logical, but even today, how many families have $250-350,000 per kid to send to college? I'd argue, not many, even among relatively high earners. Yet college applications and enrollments seem to be at all-time highs.
Just curious what makes you suspect that now? When 4 years first crossed the six-figure boundary, people were in shock and said the rising costs couldn't continue. Same when tuition averages exceeded $50,000 per year. What, in your eyes, makes today any different?
The number of former students in student loan default or those who are struggling to pay off their debt while trying to "have a life" is becoming increasingly public. I think a large % of students taking out loans don't realize just how difficult it will be to repay. They're becoming more aware of that.
It's a gradient, not a binary switch. As the price rises it reaches a point where there's not enough "oxygen" to continue. More and more people realize it is not such a good deal. That level is a lot higher with government guarantees of course.
More and more people are learning that the large amount of debt they're saddled with to go to college can set them back more than the advantage of a college degree can make up for.
If it is true that a college degree can pay for itself in a few years after graduation, then the amount of demand for college degrees would rise (it's a no brainer to do it right?).
But the production of college degrees is somewhat limited by the availability of positions, and is not infinite. Therefore, if demand rises but not the supply, the cost _must_ rise to match. Therefore, after some time, the cost of a college degree slowly grows to match the potential future value of having that degree (fuelled by free debt).
I think at some point in the last couple years, the cost of a college degree has, on average, grown to almost match the future value in earnings accounting for the debt repayment.
I only see this with people trying to check the “college education required” box, rather than trying to acquire a marketable skill. From my perspective, this was always the case, but there doesn’t seem to be any “cultural knowledge”. My naive assumption is that college recruiters/counselors are pushing people, who don’t have marketable interests, into debt, and the students don’t know any better, for whatever reason.
The problem with that conclusion, even if true (I'm sure if you dig into the study you'll find all kinds of assumptions that you may or may not agree with) is that it's based on average earnings. And as we all know, everyone believes they are above-average, or their outcomes will be above-average. It's easy to read a study such as yours then dismiss it because it includes graduates with degrees that many people assume have little earning power.
