Higher education keeps trying to solve a trust problem with better messaging. But the real issue isn’t how we communicate value; it’s the model we’re asking people to believe in.
We are all familiar with the polls, such as Gallup and Pew, showing declining confidence in higher education. In response, institutions have largely leaned harder into marketing and brand differentiation. The assumption is straightforward: Communicate value more effectively, and perception will follow. But this avoids a more fundamental question: What business are we actually in?
The cost of a traditional undergraduate education is now out of reach for most middle-class families, in many cases even with financial aid. When higher education talks about value, we cite the lifetime earnings differential between those with a degree and those with a high school diploma—though even that feels less predictably true in a labor market increasingly disrupted by AI. We point to qualitative benefits like “learning to think critically” and to career readiness, often without consistent or measurable outcomes.
In the end, we struggle to define value clearly enough to justify a quarter-million-dollar price point. More importantly, value—no matter how well validated—is hypothetical if the product itself is out of reach.
The Choke Point of Prestige
The current model of higher education doesn’t just operate within scarcity—it was built on it. In How the Ivy League Broke America, David Brooks describes a system that, a century ago, was explicitly designed for the elite. In the middle of the last century, reformers like James Conant pushed universities toward merit-based access, and policies like the GI Bill dramatically expanded who could attend. The expectation that talented students would go to college became embedded in American life. But the system did not expand capacity and aspiration at the same rate.
Instead, selectivity itself became a proxy for value. Beginning in the late 1980s, rankings like U.S. News & World Report favored high selectivity and small class size, effectively rewarding institutions for rejecting students, not educating more of them. Prestige was tied not just to quality, but to scarcity.
That dynamic continues to have cascading effects on how the system is priced and marketed. The most selective institutions set the tone for the market, creating pricing and positioning advantages for those just below them. As demand increases, costs rise. As costs rise, selectivity becomes even more valuable. And institutions have less incentive to expand access if doing so risks diluting perceived prestige.
With a few notable exceptions, population growth has far outpaced growth in seats at the most selective institutions, hard-coding a constraint into the system not just for today, but into the future.
An Uncomfortable Disconnect From Mission
This intentional scarcity creates a tension that is increasingly difficult to ignore. Higher education continues to position itself as a public good, an engine of social mobility, a pathway to opportunity, a cornerstone of democratic society. All these are true for those who want and can access a college education. But the system’s underlying market incentives often push in the opposite direction, rewarding institutions that invest in selectivity over access and reinforcing a traditional four-year model that is out of step with the needs of many students (including the 30 to 40 percent who are returning, older adults or working full-time).
The dissonance is visible to the public. When fewer than half of Americans hold a bachelor’s degree, it becomes easier to see higher education not as a shared good, but as a gated one—expensive, selective and increasingly distant from the lives of many families. The result is a credibility problem: As long as the system talks social mobility and public good while signaling scarcity through price, access and structure, those messages will struggle to land.
Rebuilding trust and serving our missions more equitably will require more than better storytelling. It will require real structural change: revisiting how we price, how we define value and how we measure success. That kind of change is difficult, in no small part because it requires capital. Institutions need margin to experiment, to bridge from the current model to something more responsive to market realities and public expectations. But tuition has likely reached its practical ceiling, and price sensitivity is already reducing demand and reinforcing perceptions of elitism. So where does that flexibility come from?
Rethinking the Model—and the Means to Change It
More institutions are already experimenting at the margins, monetizing assets, pursuing public-private partnerships, exploring mergers. We are also likely to see new revenue-sharing models tied to workforce training. But these are incremental responses to a larger structural problem.
Another, albeit uncomfortable, place to look is endowments. Designed to sustain institutions over the long term, endowments are constrained—legally, structurally and culturally—in how they can be used. At the same time, they represent one of the few sources of owned capital capable of funding meaningful transition.
This is not a simple proposition. Donor intent, governance and long-term stewardship all matter. But as economic pressures mount—declining state appropriations, threats to federally sponsored research, demographic decline, rising price sensitivity and the uncertain impact of AI—it is worth asking whether traditional approaches to endowments are aligned with the scale of the challenge in front of us. Public criticism on that point is becoming more direct. As NYU professor, entrepreneur and author Scott Galloway recently put it, “If you’re sitting on a $50 billion endowment and only letting in 1,500 kids a year, you’re no longer a public servant. You’re a hedge fund offering classes.”
A Question Worth Answering
For decades, scarcity has served higher education well. It has reinforced perceptions of quality, sustained demand and generated significant philanthropic giving. But that narrative is collapsing under the weight of a model and a price point that is driving away many Americans and creating a credulity gap that could take decades to repair.
Which brings us back to the core question: What business are we in? If the answer continues to depend on scarcity, then we should be clear about the trade-offs and costs that come with it. We are already seeing those costs in enrollment declines, institutional closures, rating agencies’ downgraded outlooks for the sector and eroding public confidence.
If not, then the work ahead is more complicated, and more urgent: finding ways to reduce cost, expand access and create structures designed for working adults. Doing so is our best shot at realigning our model with the public—and the missions—we claim to serve.
Carol Keese is vice president for university communications and the chief marketing officer at the University of Oregon.
