Scandals, Stress, and the SATs: The College Application Industry

Author: Vaishali Bansal, Graphics: Bella Aharonian

The BRB Bottomline:

Every year, millions of high school seniors apply to college. Students spend years getting ready for this process, making preparations from perfecting their resumes to studying for the SATs. However, in recent years, the college application process has turned into a business, resulting in many people and corporations trying to profit off of this nerve-wracking process. Community columnist Vaishali Bansal investigates the mysterious and exploitative inner workings of the college application industry.

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If you are reading this, chances are that you are all too familiar with the college application process. Maybe you spent your nights simultaneously stressing and studying for the SAT (or any of the other numerous college admissions tests). Maybe you were overwhelmed with the sheer amount of clubs, internships, and A.P. classes that took up all your time. Maybe you spent months editing your essays, down to the correct en and em-dash usages. I know I did.

Every year the stakes become higher, and acceptances become even more difficult to obtain. This is in part due to applications increasing each year as well as colleges attempting to boost their rankings by appearing more selective. Despite the sheer stress and anxiety that the college application process induces, high schoolers have embraced it as the norm. This process does not benefit anyone—or does it? Hundreds of corporations and other organizations have learned to capitalize on this stressful process, making millions of dollars in profit by leveraging the stress of college applications into a booming industry. 

The Test-Taking Business

Before COVID-19 hit, most colleges required SAT scores, and highly recommended taking SAT Subject Tests and A.P. exams as well. Even though some colleges claim to be “test-optional,” students effectively have no choice if they wish to stand out from thousands of applicants. Students who are aiming for top, selective universities have to pay hundreds of dollars to take these tests, often multiple times. As the only company to organize and administer these exams, the College Board, a non-profit organization with a focus on college applications, has created a monopoly on test-taking.

The College Board Monopoly

Currently, in the United States, it costs $55 to take the SAT and $96 for each A.P. exam. Additional hidden fees are often added on as well; it costs $12 to send a score report, $25 to change test centers or cancel registration, and $40 for a late registration fee. These costs have also risen since previous years; in 2010, the SAT only costed $47 and an A.P. Exam only costed $90. And these numbers are likely to rise even more in future years. For students who take the SAT several times and take multiple A.P. exams, the costs rack up quickly. 

The College Board touts itself as an “educational non-profit organization,” but that claim could not be further from the truth. In fact, in 2018, its profits totaled $94 million. This number has continued to increase in recent years; in 2020, the College Board made a whopping $1.2 billion. So how does the College Board preserve its status as a so-called non-profit? The College Board has been increasingly secretive about how they manage their finances; however, public records show that about $162 million have been sent to tax havens and secret accounts in the Caribbean and Mauritius. And if left unchecked, their questionable operations will continue to be funded by a steady stream of revenue. Despite the pandemic and the waning influence of SATs, the College Board is in no trouble. If anything, less focus on SATs could lead to a higher emphasis on A.P. exams, an even more lucrative source of revenue. Furthermore, many top universities that claim to be test-optional are still not test-blind, meaning they still consider the scores that have been submitted. For example, 90% of all the applicants accepted to Georgetown University in 2021 had submitted test scores—showing that while technically, students do not have to submit test scores, they still must do so if they wish to maximize their chances of acceptance. 

Test-Prep and SAT Coaches

Many companies have taken advantage of students’ stress and anxiety over college acceptance. College counseling services like Elite Prep and C2 Education boast huge profits coming from an expansive customer base; they offer a wide range of services ranging from test preparation to essay editing. Furthermore, online SAT Prep courses like Kaplan and the Princeton Review charge up to $2,000 and $1,600, respectively, for their most comprehensive packages, which come with live tutoring, customized assignments, and an unlimited number of practice tests. The reason the price is so high is because many parents and students are willing to pay as much as needed to gain access to test-prep resources. These are just a few of the many corporations that charge obscene amounts for test preparation; in essence, they are able to transform anxiety over test-taking into millions of dollars in profits. 

In addition to test preparation, college counselors are also a popular choice for high school students aspiring to get into top universities. These counselors provide a range of services, from tutoring and editing essays to helping choose a college list and developing extracurriculars. Whether it is advisors at college-prep companies or freelancers, college counseling is a lucrative business. Parents have paid anywhere from $2,000 to $15,000 for a college consultant, with no guarantee that their child will be accepted into the university of their choice. These consultants are able to charge such high prices because of high inelastic demand. With the societal and academic pressure of attending a “good” university, families are willing to pay and do whatever means necessary to increase the likelihood of college acceptance. 

Impact on Low Income Individuals

Students from low-income families are often unable to afford the hundreds of dollars needed to take SAT tests and A.P. exams; not to mention, SAT test prep is often out of the question. This puts them at a significant disadvantage compared to more affluent students who can afford multiple SAT attempts and test-prep resources. A study by the Brookings Institute found that students who come from a household with over a $200,000 income “outscore students whose household income is less than $20,000 by almost 300 points on a 1600-scale.” These tests are aimed to be an objective, unbiased measure of intelligence when in reality, they do not even come close to doing that. This disconnect directly fuels the wealth gap and sets up lower-income families for a cycle of poverty. These low-income students are often unable to afford the same resources available to middle and high-class kids. While privileged students may afford to spend their summers on expensive college-prep programs and fancy extracurriculars for college, low-income students may not be granted the same opportunities. Furthermore, job recruiters focus their efforts on higher-ranked universities —making it more difficult for lower-income students to land high-paying jobs. Oftentimes, job postings will state phrases like “degree from a top university” in order to attract high-ranking university candidates. Therefore, it is no surprise that Stanford, U.C. Berkeley, and Carnegie Mellon graduates account for 5 to 10% of the employees at top tech companies such as Google, Yelp, and Meta.

Unfair Admissions Process and Student Debt

Students from wealthier backgrounds also have other advantages when it comes to university acceptance. People often don’t realize that colleges are fundamentally  businesses themselves. For affluent students whose parents provide million-dollar donations, they are all but guaranteed admission. For instance, Jared Kushner, Donald Trump’s son-in-law, was accepted to Harvard after his father made a $2.5 million donation. In fact, five of the eight Ivy League schools have more students who “came from the top 1% of the income scale than from the entire bottom 60%.” 

The average college application cost is about $43. For students who apply to 10 to 20 colleges, this cost gradually racks up. Middle-class students often have to restrict the number of colleges they apply to because they do not have access to fee waivers and they cannot afford the high expenses for applications as well. On the other hand, high-income students can afford to apply to more private universities, which increases their chances of being accepted by one of them. 

Most colleges make more than half of their revenue through tuition. Private and often public universities generate profit through high tuition for their students. For instance, the average tuition in the U.C. system can go up to $40,000 per year for in-state students and $70,000 for out-of-state students. The average college student graduates with over $30,000 in debt. This high tuition is another example of how wealthy students have an unfair advantage when it comes to college admissions. Low-income students who are unable to afford the high cost of tuition and application are often forced to attend their local community college or public school instead. All their hard work and dedication does not pay off; by attending a local community college instead, it can make it harder for these students to obtain the same jobs as other students who went to higher-ranked schools. 

Private Feeder Schools

Similarly, low-income students are often unable to afford enrollment in private feeder schools. Due to the high demand for acceptance into Ivy League schools and other top universities, private high schools have soared in popularity. These schools often boast smaller class sizes, a more personalized educational experience, and often a direct pipeline to Ivy League universities. These high schools are able to generate millions of dollars of profit each year through parents who are desperate to get their students into top schools. Take, for instance, the Trinity School in New York, a private feeder high school: it charges up to $43,000 annually per student. And in return, 40% of their student population is admitted to an Ivy League school, a percentage significantly higher than other schools in the United States. These schools continue to make a fortune while these affluent students keep being admitted to top universities.

Financial Aid

Meanwhile, low-income families do not often get this same opportunity. In many instances, top colleges attempt to bridge this gap by offering financial aid and scholarships. However, at times, the aid that poorer families receive is still not enough to cover the cost of tuition over four years. Furthermore, middle-class families are often forgotten about; they make too much money to qualify for financial aid but too little to afford college tuition. In fact, middle-class students are underrepresented at private universities in comparison to both low and high-income students. According to a report by Inside Higher Ed, middle-class students only account for between 4.4 and 4.7% of Ivy League students. 

The college application process is a booming industry. Whether it’s the countless test-prep companies or the expensive private schools, there is no shortage of businesses that are profiting off of the stress and anxiety that the college admissions process brings. Unfortunately, the rise of the lucrative industry has put low-income students at a severe disadvantage. Without the money to afford these resources, they are unable to compete with students who are able to afford them. For a fairer admissions process, colleges must start taking into consideration students’ income and how that can affect their college preparation.

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Take-Home Points

• Corporations have taken advantage of the stressful college application process and turned it into a booming industry. 
• There are endless businesses that make money off of services such as test-prep, essay editing, college coaching, and tutoring.
• Private feeder schools also make a lot of money by offering a higher chance of admission to Ivy League universities and charging thousands of dollars in tuition.
• Students from low-income families are often unable to afford these helpful resources, which puts them at a significant disadvantage when it comes to applying to colleges. 
• Wealthy students appear more qualified during the admissions process, which causes them to be disproportionately admitted to top universities. This fuels the cycle of poverty that low-income families are trapped in.