Colleges Hold Billion-Dollar Funds While Raising Tuition Fees

Rising Tuition and Job Cuts at Universities Despite Large Donations

Many universities are increasing tuition fees and making cuts to staffing, all while having significant donations in their coffers.

Although schools have criticized the Trump administration’s cuts to federal funding, the reality is that tuition fees have been on the rise for years. Revenues have consistently increased during this period, accompanied by growing donations. For instance, Cornell University has raised its tuition by over 4%. This means out-of-state students will now pay $71,266, while in-state students face a fee of $48,010. Similarly, Duke University is seeing a tuition increase of nearly 5%, resulting in a total cost of $92,042.

Interestingly, Duke’s endowment has more than doubled, growing by 123% over the last two decades to about $5 billion. In its financial report for the 2023-2024 fiscal year, the university acknowledged that their revenue growth outpaces costs.

Meanwhile, as Duke raised its undergraduate tuition to approximately $83,263, it also hinted at workforce reductions. The institution is introducing voluntary separation packages, which include financial incentives and healthcare benefits in exchange for a three-year exit from the university.

Duke did not provide comments when requested.

Cornell, on the other hand, has voiced its concerns regarding federal research funding cuts, expressing the notion that universities face significant financial hurdles. They’ve paused hiring as they review their programs and staff.

As of 2024, Cornell brings in over $900 million annually from tuition and fees. Their endowment is around $10.7 billion, generating returns close to 10% every year. There was no response from Cornell regarding inquiries made.

In addition, several public universities, including the University of Michigan and the University of Minnesota, are implementing tuition hikes of around 7.5% while simultaneously cutting programs and student services. The University of Minnesota has raised tuition by 6.5% for in-state students and 7.5% for out-of-state students, partly citing federal funding cuts.

Their budget exceeds $5 billion, complemented by system-wide donations of approximately $6 billion. UM did not respond to requests for comment.

At the University of Michigan, in-state tuition has risen over 3% while out-of-state tuition has increased nearly 5%. With a significant endowment of $18 billion, the university attributes these hikes to federal budget actions and a climate of economic uncertainty. A spokesperson directed inquiries to the official statement from the university.

Universities have seen tuition costs rise consistently over the decades, often attributed to inflation. Research suggests that federal financial aid has contributed to these inflated costs.