The Rising Cost of Higher Education

Across the world, the cost of attending university has surged over the past two decades. In Australia, for example, university fees have increased significantly since the introduction of the Higher Education Contribution Scheme (HECS-HELP), particularly in disciplines like law, business, and the arts. In the United States, student loan debt has ballooned to over $1.7 trillion, with the average graduate owing between $30,000 and $50,000. Even in countries with more heavily subsidised education systems, such as the UK and Canada, students face growing tuition, accommodation, and living costs.

The reasons for this rise are complex. Increased administrative costs, reduced public funding, and the growing demand for university degrees have all played a role. At the same time, universities have expanded their facilities and services to attract more students, often passing those costs on through higher fees.

Is a Degree Still Worth It?

Despite the rising cost, university is still widely regarded as a worthwhile investment—on average, graduates earn more over their lifetime than non-graduates. In Australia, for instance, the wage premium for those with a bachelor’s degree remains around 30% higher than for those with only a high school diploma. However, this average masks wide variation between fields of study. Degrees in medicine, engineering, and information technology tend to yield strong returns, while some arts and humanities degrees offer more modest income prospects.

The key issue is not whether education has value, but whether the cost of that education is reasonable and fairly distributed. When students graduate into a job market with stagnant wages, high underemployment, and rising living expenses, it can take years just to repay their debt—especially for those who did not complete their degree or took longer to enter full-time employment.

The Psychological and Financial Burden of Student Debt

Debt doesn’t just affect bank accounts—it also influences life decisions. Studies from Australia, the UK, and the US show that student debt can delay home ownership, reduce retirement savings, and even influence career choices. Young people may avoid lower-paying but socially valuable professions, such as teaching or social work, in favour of jobs with quicker financial returns.

The emotional toll is also real. Many students report anxiety about accumulating debt, and young graduates often find themselves juggling loan repayments alongside rent, bills, and the rising cost of living. In Australia, although HECS-HELP repayments are income-contingent and interest-free, they are indexed to inflation. With inflation hitting record highs in recent years, some borrowers have seen their balances increase rather than shrink—despite regular repayments.

Alternatives and Reforms: What Can Be Done?

In response to growing concerns, some countries have explored or implemented reforms. In Germany and the Nordic nations, tuition-free university education is seen as a public good. In the US, there have been calls for widespread student debt cancellation or free community college. In Australia, proposals have included freezing indexation or forgiving debts for graduates in critical sectors like healthcare and education.

Others argue for better financial literacy and clearer information for prospective students. This includes realistic estimates of graduate salaries, job market trends, and expected loan repayments. Some universities are also offering shorter, skills-focused courses or vocational training options that provide quicker and more affordable paths into the workforce.

Empowering the Next Generation

While policymakers debate the future of higher education funding, young adults are taking matters into their own hands. Many are choosing cheaper pathways—such as starting at TAFE or community college, studying part-time while working, or seeking scholarships and financial aid. Others are questioning whether university is the right path at all, opting instead for apprenticeships, tech bootcamps, or entrepreneurial ventures.

Education remains a powerful tool for personal and economic growth, but only if access to it is fair, sustainable, and truly empowering. Addressing the student debt crisis requires more than just adjusting interest rates—it demands a serious look at how society values education and how we choose to invest in the future of our youth.