Colleges in Dire Financial Straits

[polly_mer]

Quinnipiac announces salary cuts that start in April

[polly_mer]

Central Washington University declares financial exigency

[Wahoo Redux]

Quinnipiac announces salary cuts that start in April

Central Washington University declares financial exigency

The government is handing out cash in an attempt to stave off disaster. 

These folks should be in line.

[Hibush]

Quinnipiac announces salary cuts that start in April

Central Washington University declares financial exigency

The government is handing out cash in an attempt to stave off disaster. 

These folks should be in line.

Surprisingly, only HBCUs have taken that initiative so far AFAIK. And they had the Thurgood Marshall Fund and UNCF get in line on their behalf with a rather modest ask of $1.5 billion.

[polly_mer]

Quinnipiac announces salary cuts that start in April

Central Washington University declares financial exigency

The government is handing out cash in an attempt to stave off disaster. 

These folks should be in line.

That's a lovely thought.  Cross all your digits for them. The big wave of similar announcements that's just around the corner isn't going to be helped all that much by fixing the temporary cash flow problem due to COVID-19.

For those who need the very short version of the state of higher ed even before COVID-19 stressed the system:

2016 Report: "It would be a mistake, however, for college and university officials to think that this period of financial distress and the public's unease about the value of a degree is in any way temporary." ... "some 800 institutions face critical strategic challenges because of their inefficiencies or their small size."

Dec 2018: "it's not that hard to paint a picture of how 25% of existing institutions—be it 550 nonprofit and public four-year institutions or 1,100 degree-granting institutions—close, merge or declare bankruptcy in the years ahead."

Feb 2019: A contributing factor to higher ed woes are the trustees who know little or nothing about higher education or its problems."Less than 10 percent of these trustees have any professional experience in higher education. One cannot imagine a company board in which such a small percentage of members understood its core mission, strategies, financing, competition, and competitive advantage."

Mar 2019: "especially small, private liberal arts schools, have been operating similarly to how someone might live paycheck to paycheck, some having survived that way for 20 years or more at this point."..."Colleges and universities will have too much capacity and not enough demand at a time when the economic model in higher education is already straining under its own weight," <Marty Meehan, president of UMass> said. "Make no mistake – this is an existential threat to entire sectors of higher education. And New England, unfortunately, is ground zero."

Apr 2019: "Some 800 institutions face similar <to recently closed Mount Ida College> 'critical strategic challenges' because they're operated inefficiently or are very small, according to the consulting firm Parthenon-EY Education."..."Picking away at the problems in what he called incremental ways, however, isn't equal to the magnitude of the crisis, <Brian Mitchell former president of Bucknell University> said. "If in fact you're practicing incrementalism, then you're in real danger now and could be in grave danger shortly," he said.

Dec 2019: "Moody's Investor Services estimates 1 in 5 small private colleges faces 'fundamental stress' due to declining revenues, rising expenses and little pricing power when it comes to tuition"..."Most colleges operate as long as they can. What typically causes them to close is that they run out of cash. It's like any other business a liquidity problem. And therefore, the closures are not always orderly"

COVID-19 is exacerbating existing problems of being on the ragged edge.  However, the problems already existed and, like the unicyclist juggling chainsaws while riding in heavy traffic, the tragedy was just waiting for any sort of blip to occur.  The entities who just need a little cash to get by during the worst of the crisis haven't even begun to feel the hurt yet.

[apl68]

You're right.  This is likely to prove a final straw for quite a few institutions.  Even if there is a significant federal effort at bailout, it is likely not to be enough to give many places even a reprieve, given a blow this severe.

[Wahoo Redux]

You're right.  This is likely to prove a final straw for quite a few institutions.  Even if there is a significant federal effort at bailout, it is likely not to be enough to give many places even a reprieve, given a blow this severe.

Personally I'd rather see the cruise-lines get the bailout.  Not!

Polly's list, as always, is very daunting and demoralizing.

If there is hope it is that America will comprehend the economic dangers facing higher ed and respond by mobilizing the vast wealth of the country to save our colleges.  People do care.

[Hibush]

Forbes, unsurprisingly, sees an opportunity for the hyperwealthy.

With international travel down, recruiting visits to colleges are curtailed and the prospects for matriculation as well. That means some good colleges will be seeing sharply lower yields of international full-pay admits. The great news (from the forbesian perspective) is that weaker domestic full-pay applicants will now be admitted for the coming fall.

[apl68]

You're right.  This is likely to prove a final straw for quite a few institutions.  Even if there is a significant federal effort at bailout, it is likely not to be enough to give many places even a reprieve, given a blow this severe.

Personally I'd rather see the cruise-lines get the bailout.  Not!

Polly's list, as always, is very daunting and demoralizing.

If there is hope it is that America will comprehend the economic dangers facing higher ed and respond by mobilizing the vast wealth of the country to save our colleges.  People do care.

To clarify, I'm not trying to say that emergency federal aid to higher education would be useless.  If it's intelligently applied and can arrive in time, it might make a difference for some schools.  But polly's probably right that some are already too far gone.

Realistically, any aid would probably have to be targeted toward areas where it might be expected to do the most good.  The HCBUs and their allied organizations have already made the ask.  They can point to a specific mission serving a specific historically under-served demographic to help them make their case.  What other sorts of institutions might be able to make a specific case for why they're deserving?

[tuxthepenguin]

There are too many sources of uncertainty to try to predict the effect on colleges and universities.

It all comes down to enrollment. One reason enrollment was down was because there were fewer high school graduates.

Another was that the job market was really good. If you graduated from high school, you could get a decent enough job, so you didn't go to college. If you graduated from college, you could get a decent enough job (in spite of many claims to the contrary, it's true), so you didn't go to grad school. Those opportunities are now gone.

There are loads of other changes that can happen to the economy and to society as a result. It's way too early to say. There's no reason to be pessimistic or optimistic.

[Wahoo Redux]

To clarify, I'm not trying to say that emergency federal aid to higher education would be useless.  If it's intelligently applied and can arrive in time, it might make a difference for some schools.  But polly's probably right that some are already too far gone.

Perhaps. Polly is very well informed about these things.  I've been reading her links, however.  She does tend to cherry-pick to represent gloom-and-doom, and that's not always the case with these things I'm reading.  I'll post later.

I do think we at least need to give these schools a fighting chance. 

I'm reminded of the business major who corrected my percentages about small business success rates: in total, 85 to 95 percent of small businesses will fail within years 1 to 5 of opening; 70 percent of these surviving businesses will go broke by their tenth year anniversary.  Undoubtedly COVID relief funds are being funneled to business that will fail and would have failed no matter what.  No one is talking about withholding funds from these small businesses----if anything, the ethical weight is on helping small businesses survive.  I don't see why colleges are any different.  There is a mass of people who will be unemployed, careers of all sorts broken, if we let these institutions fail.

[polly_mer]

Wahoo wants something other than doom and gloom on a thread that is explicitly about pointing to doom and gloom. Well, let's give that a go since these are interesting times.

The elite institutions are going to make it, but are likely to be transformed through their experiences in the coming couple of years.  This might finally be the tipping point in some cases to implement good, non-academic support for the students who start with minimal social capital.  With a lot of experienced, excellent faculty out of work, this might be the time that elite institution make more of an effort to hire full-time teaching faculty for undergrads and split off research faculty to focus primarily on graduate education.  That's more good jobs overall, although many people will have to move from dying regions to more expensive regions, which will be a bridge too far for some excellent teachers who will go out and do something else fabulous in the world.

The small institutions that are doing a very good job and have sufficient resources to weather this year are likely to be in great shape for the coming years.  By consolidating students who want a personalized education that allows for exploration in a learning community, this sector of education won't die.  It will have far fewer campuses, but the campuses are likely to be more vibrant.  Why more vibrant?  The institutions in less desirable places will be able to hire the displaced excellent faculty who otherwise wouldn't consider such a location, but are on board with having a great job in a good enough town.  However, this rosy picture requires institutions to announce their impending closures early enough in the process to free up faculty to search for a whole year or even three instead of just putting on the streets at the end of a term the remaining handful of people who already couldn't get other jobs in a tight market.

The regional comprehensives may be winners as the region consolidates into fewer higher education institutions available.  Spreading 10000 students over 10 institutions is a different situation than having 9000 of those students go to one institution and 1000 students leave the region for either the small LACs open elsewhere or an elite institution.  Again by consolidating, more good faculty jobs could be a result as the institutions stop competing so hard for students who can't/won't/don't leave the region anyway and can redirect resources into having a solid education.

This could be an opportunity for faculty who are experts in online education to get jobs somewhere distant from where they live and have those jobs be good enough jobs.  While many institutions will go back to their on-campus instruction as soon as possible, other institutions may find their students ask for additional online education.  The Consortium for Online Humanities Instruction is likely to pick up additional institutional members and perhaps be more open to faculty who aren't affiliated with the on-campus instruction.  By focusing on offering a larger curriculum to augment on-campus programs, the faculty teaching in these programs are likely to have better jobs than with the for-profits that have been closing.

As many adults go for additional education in the foreseeable wave of unemployment, adults in dying regions where they have good community/family support are likely to stay physically put and go online for that education.  That means faculty who want to teach online may have additional options for employment and possibly good enough full-time employment with reputable institutions who are expanding their online offerings.  Community colleges are likely to see an increase in enrollment and it's very likely those institutions would be able to advocate for COVID-19 additional funds to support their mission of getting America back to work.

On a more individual level, this may be the time that educated people forced out of their normal comfort zone end up becoming community leaders in something or otherwise find something else they would like to do as a full-time job.  That's not everyone, but some people may discover things they'd rather do, are more day-to-day satisfying than their recent academic job, and develop networks for paid work outside of academia.  Those folks will then likely go on to other things and make the academic job market a little less tight while having a better individual outcome.

However, none of this rosy picture happens if everyone clings to returning to the recent past exactly as it was while somehow ignoring that the higher ed landscape had a lot of doom and gloom for valid reasons.  Distributing money to make these kinds of changes is a far better use of the money than trying to ensure nothing fails.  At this point, just sending individual human beings monthly checks for $1000 to do whatever their household needs is a better use of our tax dollars than trying to prop up hundreds of institutions that should consolidate, drastically change mission, or straight up close and redistribute humans.

At no point, though, do we end up with enough good faculty jobs for everyone who is qualified and wants one without large numbers of people deciding they would rather do something else and taking themselves out of the academic pool.

[marshwiggle]

This could be an opportunity for faculty who are experts in online education to get jobs somewhere distant from where they live and have those jobs be good enough jobs.  While many institutions will go back to their on-campus instruction as soon as possible, other institutions may find their students ask for additional online education.  The Consortium for Online Humanities Instruction is likely to pick up additional institutional members and perhaps be more open to faculty who aren't affiliated with the on-campus instruction.  By focusing on offering a larger curriculum to augment on-campus programs, the faculty teaching in these programs are likely to have better jobs than with the for-profits that have been closing.

In this vein, I think the current situation will advance online learning at all levels by about at least a decade.

[Wahoo Redux]

Wahoo wants something other than doom and gloom on a thread that is explicitly about pointing to doom and gloom. Well, let's give that a go since these are interesting times.

I want neither CNN nor Fox news, ghost peppers nor pure vanilla, a kick in the teeth nor a Swedish massage (really I don't; I had a professional massage once----it was oily and disgusting).

Neither do I want rose-tinted glasses nor gloom-and-doom.

I want objective, un-filtered info as much as possible.  If there is expert opinion I want the whole opinion and not a cherry-picked excerpt.

And I appreciate your observations and opinions, Polly, I really do (obviously I read them) but you have an agenda.  Why I cannot understand.  I suspect it is something personal whether or not you consciously recognize it.

I too have an agenda which I believe is pretty rational.

At no point, though, do we end up with enough good faculty jobs for everyone who is qualified and wants one without large numbers of people deciding they would rather do something else and taking themselves out of the academic pool.

This is when someone logs and asks us to move the conversation elsewhere.  But yeeeeeesssss we know. 

My point has always been that there is plenty of work for almost everyone, we simply have short-changed our own system.

[Hibush]

This could be an opportunity for faculty who are experts in online education to get jobs somewhere distant from where they live and have those jobs be good enough jobs.  While many institutions will go back to their on-campus instruction as soon as possible, other institutions may find their students ask for additional online education.  The Consortium for Online Humanities Instruction is likely to pick up additional institutional members and perhaps be more open to faculty who aren't affiliated with the on-campus instruction.  By focusing on offering a larger curriculum to augment on-campus programs, the faculty teaching in these programs are likely to have better jobs than with the for-profits that have been closing.

In this vein, I think the current situation will advance online learning at all levels by about at least a decade.

I went to the COHI website, and there is no indication that the effort continued. Are the still doing the courses within the consortium that developed them?

I saw in the report that there was no cost savings at all. So no direct benefit for college finances. The instructors also indicated that they were not able to develop individual relationships with the online students. Those relationships are a big selling point for the very small at-risk colleges. Would that limit small colleges' use of the online courses to a few here and there to complement the local curriculum?