GRAND FORKS — Students are talking about rising costs of goods and services, says UND senior Kaitlin Hazel. She and her boyfriend pay for groceries together and have begun to find that each trip to the grocery store costs more.
“It used to be like $100 and now it looks like we’re going to the grocery store and it’s almost $200 for two weeks worth of groceries,” she said.
Hazel is paid to conduct psychology research on campus this summer, but once school starts, the number of hours she can do is reduced.
“So extra expense and less money,” she said.
Inflation affects many aspects of higher education, said David Flynn, professor of economics and finance at UND. This includes what students can afford and what schools can afford.
On Wednesday, July 13, the consumer price index was 9.1%, the highest since November 1981. This 40-year comparison actually points to a time when the inflation rate was falling, Flynn said, but a bigger problem today is that rates continue to rise.
“Inflation isn’t necessarily showing many signs of slowing down right now, and we’re still working on it,” Flynn said. “It could be a spike, sure, but at the same time, that doesn’t mean it’s not capping high and that doesn’t mean individuals aren’t feeling the pinch of higher prices.”
In higher education, faculty, staff, and administrators should be paid and have benefits. Rising prices for construction and maintenance services mean that it costs more to start and complete projects on campus.
As costs outside of school rise, tuition fees can become a deterrent to prospective students and their families. At the same time, tuition and fees are a source of revenue for higher education institutions.
“Now you’re sitting there saying ‘Wait a minute, I’m being hit by revenue and my costs are going up, so how exactly am I going to handle this?’ “, Flynn said.
This is something that universities like UND are considering.
Periods of high inflation correlate with declining enrollment in higher education institutions, said Jed Shivers, who experienced high inflation in the 1970s as a student. But as vice president of finance and operations, he’s also aware of the rising costs of running, staffing, maintaining and improving a school.
Construction and maintenance costs are particularly high at the moment. Many campus beautification projects at UND take place in the summer, and Shivers estimates the projects cost double what they cost last year. Some construction projects, such as the new Nistler College of Business and Public Administration, will not be affected by inflation due to when the money was borrowed or the current status of the project. Others, such as the Merrifield Hall and Twamley Hall renovation project, could be affected.
In the case of the Merrifield-Twamley project, funding from the North Dakota Legislature is capped at $50 million, but that money will not stretch as far as it would have when that total was approved. From now on, certain parts of the project will have to be prioritized.
“We will make sure that the academic spaces are well set up, because that’s really what this is all about – to really give the academic side of the house the spaces they need to do great teaching for our students and for our faculty can work,” Shivers said. “But the administrative parts, those spaces probably won’t be affected.”
Along with construction, inflation will likely drive up costs for wages and salaries, medical care for employees and operating expenses, Shivers said.
“I’m not sure that public higher education can or should raise prices to try to get out of this because I think what we might see is a drop in enrolment. So that we don’t want not do it,” Shivers said.
UND President Andrew Armacost said resisting the trend to raise tuition fees while selling the value of UND attendance will help the school cope with rising costs.
“We have to be careful. The approach the university must take is to look for cost savings, just in our day-to-day operations, or to be mindful of how we can spend the money, but also to continue to showcase the value of an education at the University of North Dakota to try to increase enrollment,” he said.
Enrollment of new freshmen in summer school at UND is up from previous years, says Janelle Kilgore, vice provost for strategic enrollment management, but it’s still too early to tell how many students will be enrolled in the fall semester. On average, 6% to 12% of students who have deposited a registration deposit end up not coming in the fall.
Recruitment begins two to three years in advance, so at this time UND is recruiting students who will be attending in 2024 and 2025. Financial discussions on UND include scholarship opportunities, work opportunities, and ready, Kilgore said.
“We work very hard at UND to be transparent with tuition and things like that,” she said.
Living and eating on campus can help protect students from the effects of rising prices. Beth Hellwig, acting vice president of student affairs, said for students who purchase a dining plan, the price is locked in and will remain the same throughout the year. It is up to food services to decide which ingredients and foods to buy and which meals to serve as prices rise.
“We have to be very creative in how you provide good quality, nutritious food as prices rise dramatically,” Hellwig said.
She suggested that the compromise might look like reducing the number of options offered. For those without a meal plan, on-campus meal prices will increase.
Living on campus adds another convenience factor, Hellwig says, with food services and classes closer than for students living off campus.
For students in financial difficulty at UND, there is a program called the Angel Fund. Students can request money to cover emergencies, such as a month’s rent or medical bills. The account is funded in part by the UND Alumni Association and is still accepting donations.
The average amount given to students is $750, but often, says Hellwig, the need is much greater.
“We have a limited amount of money that we can spend and we want to try to make sure that we give it to as many students as possible,” she said.
At the North Dakota university system, the state Council on Higher Education plans to work with the Legislature to address inflation. North Dakota’s public school funding model is a mix of statutory funding and revenue from tuition and fees.
“Our legislature and our government want higher education to be responsive to students, okay, not everything is paid and you have to have people who want to pay at that tuition rate, so there are the forces of market,” said NDUS chancellor Mark Hagerott. “Under normal circumstances, that’s exactly the way to go, because if students think your price is too high, we’ll go elsewhere.”
But inflation creates a challenge for this funding model. Schools have done nothing to influence the price hike, but have to bear the consequences, which negatively affects students and families who pay for education, Hagerott explained.
“One of the discussions we would like to have with the Legislative Assembly is a way to lessen the impact on families,” he said.