Colleges in Dire Financial Straits

[TreadingLife]

Looks like deposits are running about what they were a few years ago, when we missed our target for the incoming class by more than ten percent.

True, but you can't compare this year to any prior year. No one knows if we will be face to face in the fall. Most schools have extended their deposit deadlines (which will throw off comparisons to prior years right there), and even still, parents want to know what product they are getting in the fall before they send in that deposit. It stinks that things are so uncertain, but I don't think you can read too much into where deposits are today relative to any other period.  Everything could change if we find a vaccine and classes are face to face in the fall. Another wild card is how well the economy starts back up. Will parents even be in a position to afford college if they are still unemployed? No one knows what September will bring, let alone what the end of the May will bring. I agree that where deposits stand today are troubling for many institutions if current trends persist.

cue Monty Python's "Always look on the bright side of life..."

[quasihumanist]

My worst case assumptions include both a one-semester furlough for all faculty next year and 50% inflation (well - 100% on food and some consumer goods but 0% on most other things) with no corresponding raises.

[secundem_artem]

A bit of a different take.  I know there are a few Canadians and Euro types on these fora so will ask them to chime in if I am wrong here.

First - We got into this mess in the US because higher education is largely in private hands. A hundred and fifty years ago, every town big enough to need 2 hookers opened up a college - whether for the religious formation of the clients of said hookers or as a finishing school for the sons and later daughters of the local
squire-archy.  Nebraska has 20+ 4 year schools for a population of under 2 million people.  On the other hand, Montreal Canada is roughly the same size and has 2 English Universities, 2 French Universities and a few satellite campuses or miscellaneous schools affiliated with another institution. 

Higher education in the US is massively over-built and, as Polly has repeatedly pointed out, far too many schools are too small, too rural and too undistinguished to be attractive to enough students to be viable.  Placing higher education mostly in private hands allowed for the number of schools having a much greater capacity than there are students willing to put bums in seats.  A Malthusian growth model if ever there was.

In many other countries, higher education is almost entirely a public venture, governments did not approve a college in every 2 hooker town and the resulting schools are much more likely to weather the demographic storm of a shrinking 18-22 year old cohort or the public's growing mistrust of higher ed.

Second point -- the American mania for "getting into a good college".  We may not like streaming cohorts of students according to perceived ability, but what we see in the US is an awful lot of kids who are in college mostly because they don't know where else to be. 

Proper, well-regulated internships, apprenticeships and similar on the job training coupled with the necessary coursework to become a pharmacy front-end manager, an insurance agent, a diesel mechanic, a tax preparer or head of accounts payable would suit a lot of students better than a major in something they don't care about, accompanied by 24 credits of general electives they truly did not care about. 

Third - the education in private hands matter above meant there was very little to prevent any college that was looking for a bit of prestige from opening up a PhD program.  Their grads could teach all the required make work for humanities PhDs general electives that every student has to take.  My own uni long offered EdDs for prospective principals and super-duperintendents, but now we also offer a PhD of no particular value as far as I can tell.  It's like the college building boom of the past - there's not much to stop anybody from building colleges or cranking out PhDs.

No disrespect meant to you Wahoo, but I read your posts as being aware of all the doom and gloom you get from Polly but still devoutly wishing there was some way to not have it all be true.  If you have proposed solutions for the mess we are in, I have missed them in your posts.  I believe you understand the issues as well as anybody, but are addressing them mostly with wishful thinking that "we" will suddenly........

Any rational use of resources in a well run public system would think seriously about shuttering or merging hundreds if not thousands of schools that are struggling along with no prospects of ever doing any better.  Any rational use of resources in a well run public system would think seriously about closing (or at least slashing the size of)  PhD programs who cannot demonstrate their graduates won't die on the adjunct death march.

But all that would require -- you know -- big gubm'nt or even worse socialism!!!! and America ain't ready for that.  So the logic of the marketplace will continue.  Schools will struggle until enough of them close so that the capacity of the system is commensurate with the necessary resources.  And PhDs will continue to be produced, will continue to struggle to find real academic careers until the market convinces enough bright young undergrads that a couple of Microsoft certifications in addition to their BA in history or political science is a better career choice than the PhD.

[Wahoo Redux]

No disrespect meant to you Wahoo, but I read your posts as being aware of all the doom and gloom you get from Polly but still devoutly wishing there was some way to not have it all be true.  If you have proposed solutions for the mess we are in, I have missed them in your posts.  I believe you understand the issues as well as anybody, but are addressing them mostly with wishful thinking that "we" will suddenly........

I am either not stating my simple suggestions very well or forumites are simply so gloomy they are unable to listen. 

There is no "suddenly" about it.  I do not know how many times I have posted that revival would be long process if it is to happen at all.   No suddenly.  No suddenly.  No suddenly. Geeze.

Nor is there "wishful thinking"---and I take no offense, but this is what I mean when I say that we are simply unable to listen, probably because we are so caught up in gloom and doom.

My suggestions have been pretty simple...

*Publicize the plight of colleges.  We don't need every single American.  We need enough. There are billions of donation dollars siphoned into millions of projects.  I cannot figure out why we would resist making this a loud national cause (after the plague is over, obviously).  Write congress. Letters to the editor.  Start a blog.  Post Facebook.  Whatever. 

The adjunct army has received a fair amount of press in the last five years (one of the things that people here strangely deny even though the proof is a Google search away---which is more of this strangely defeatist attitude) and the result is a slow changing of the tide: adjunct jobs are falling, full-time jobs are rising.  The plague may reverse this, but it is an example of how people react when education becomes news.

We MAY have pumped out too many PhDs----but gee whiz, the work is there for most of them.  It really is.  Just look at the simple numbers.  We have the work, we just want to parcel it out.  So simple.  Argh.

I worked in a couple of industries before going back to grad school.  Academia is the only one I am aware of that does not aggressively fight to stay alive when things turn grim.  I suspect it is the individualistic nature of our work, but I don't know. 

* Get our professional organizations involved.  Lobby.

* Fight to bring back state support.  See above.

* Write journalism (what I do).  Get the message out there. 

* Do a study of the economic impact of colleges, even the tiny ones.  Colleges create micro-economic-and- cultural environments.  Even a small college may employ 1,000 to 5,000 people depending on the size of the school, from faculty to the food service workers to vendors to security guards. In small communities, the college may be what keeps it from truly being a two hooker town. Survey the local landlords, fast-food joints, and supermarkets.  Okay to shrug off the loss of 1,000 jobs during boom-time, another to shrug off 1,000 jobs during a recession which we may be heading into.

* Research.  Polly's links are very sobering.  Almost always they contain ideas and strategies to reverse the trend.  Not all of them will be successful, of course, which is simply part of the game.

* Hit up alumni.  We've seen that alumni will mobilize.

* Acknowledge the things you've noted above and that Polly is obsessed with.  Acknowledge that there are things we can do OVER THE LONG TERM to save as many schools as we can.

* Or give up.  I don't work for a college in dire straights.  My job is secure, at least for the time being.  I am relatively cheap for what they get from me.  I frequently consider leaving academia anyway---so if my job goes I would be okay (doesn't pay that great).

These are just suggestions.  I don't have as much experience as many of you.  Maybe someone knows better.

My idea here on the Fora is that we ALSO talk about what could be done. 

Come up with ideas.  Make suggestions.  Talk to each other.  Administrators say something.

Or give up.  We may not care enough to make a difference.

[spork]

Looks like deposits are running about what they were a few years ago, when we missed our target for the incoming class by more than ten percent.

True, but you can't compare this year to any prior year.

[. . .]

Actually you can. And should. Because too many higher ed institutions ignore long-term trends by engaging in optimism bias and assuming "bad years" are one-off outliers. You might be surprised at the number of colleges and universities in the USA that haven't returned to pre-2008 recession enrollment levels.

[marshwiggle]

* Do a study of the economic impact of colleges, even the tiny ones.  Colleges create micro-economic-and- cultural environments.  Even a small college may employ 1,000 to 5,000 people depending on the size of the school, from faculty to the food service workers to vendors to security guards. In small communities, the college may be what keeps it from truly being a two hooker town. Survey the local landlords, fast-food joints, and supermarkets.  Okay to shrug off the loss of 1,000 jobs during boom-time, another to shrug off 1,000 jobs during a recession which we may be heading into.

Suppose this town bends over backwards to keep this place afloat, desptie declining enrollment, etc. And the next town supports theirs, and so on. Every place teeters on the brink, and requires ongoing infusions of cash to survive. On the other hand, if this one closes, then that may by itself help out the neighbouring towns as students redistribute. Some people may find jobs there as well.

Propping up places regardless of how precarious they are prevents those resources from being used to provide more meaningful support to the places that could potentially thrive if they had the means to make some changes that the money would allow.

"As many as possible" is a useless metric, because it avoids any concrete recognition of what responsibility the institution has to work within its means and adapt to the world in which it exists.

[dr_codex]

A bit of a different take.  I know there are a few Canadians and Euro types on these fora so will ask them to chime in if I am wrong here.

First - We got into this mess in the US because higher education is largely in private hands. A hundred and fifty years ago, every town big enough to need 2 hookers opened up a college - whether for the religious formation of the clients of said hookers or as a finishing school for the sons and later daughters of the local
squire-archy.  Nebraska has 20+ 4 year schools for a population of under 2 million people.  On the other hand, Montreal Canada is roughly the same size and has 2 English Universities, 2 French Universities and a few satellite campuses or miscellaneous schools affiliated with another institution. 

Higher education in the US is massively over-built and, as Polly has repeatedly pointed out, far too many schools are too small, too rural and too undistinguished to be attractive to enough students to be viable.  Placing higher education mostly in private hands allowed for the number of schools having a much greater capacity than there are students willing to put bums in seats.  A Malthusian growth model if ever there was.

In many other countries, higher education is almost entirely a public venture, governments did not approve a college in every 2 hooker town and the resulting schools are much more likely to weather the demographic storm of a shrinking 18-22 year old cohort or the public's growing mistrust of higher ed.

Second point -- the American mania for "getting into a good college".  We may not like streaming cohorts of students according to perceived ability, but what we see in the US is an awful lot of kids who are in college mostly because they don't know where else to be. 

Proper, well-regulated internships, apprenticeships and similar on the job training coupled with the necessary coursework to become a pharmacy front-end manager, an insurance agent, a diesel mechanic, a tax preparer or head of accounts payable would suit a lot of students better than a major in something they don't care about, accompanied by 24 credits of general electives they truly did not care about. 

Third - the education in private hands matter above meant there was very little to prevent any college that was looking for a bit of prestige from opening up a PhD program.  Their grads could teach all the required make work for humanities PhDs general electives that every student has to take.  My own uni long offered EdDs for prospective principals and super-duperintendents, but now we also offer a PhD of no particular value as far as I can tell.  It's like the college building boom of the past - there's not much to stop anybody from building colleges or cranking out PhDs.

No disrespect meant to you Wahoo, but I read your posts as being aware of all the doom and gloom you get from Polly but still devoutly wishing there was some way to not have it all be true.  If you have proposed solutions for the mess we are in, I have missed them in your posts.  I believe you understand the issues as well as anybody, but are addressing them mostly with wishful thinking that "we" will suddenly........

Any rational use of resources in a well run public system would think seriously about shuttering or merging hundreds if not thousands of schools that are struggling along with no prospects of ever doing any better.  Any rational use of resources in a well run public system would think seriously about closing (or at least slashing the size of)  PhD programs who cannot demonstrate their graduates won't die on the adjunct death march.

But all that would require -- you know -- big gubm'nt or even worse socialism!!!! and America ain't ready for that.  So the logic of the marketplace will continue.  Schools will struggle until enough of them close so that the capacity of the system is commensurate with the necessary resources.  And PhDs will continue to be produced, will continue to struggle to find real academic careers until the market convinces enough bright young undergrads that a couple of Microsoft certifications in addition to their BA in history or political science is a better career choice than the PhD.

Not chiming in on your larger argument, but a clarification: Montreal does have only 4 universities. But it also has a few dozen CEGEP's -- roughly the equivalent of grade 12 and a year of college; sort of equivalent to a Junior College / Community College, but not really. The whole system in Quebec is very different from secondary and collegiate systems in the rest of Canada and the United States. In principle, it does some of what you (and Polly) have been lobbying for. In practice, it is cash-strapped, politically volatile, and part of a system that taxes Quebec citizens at a high rate. It is a unique product of the highly idiosyncratic history of Quebec, and an unlikely model for educational reform in any other place.

This is a shift to systems, and away from colleges in distress. I'm happy to share what I know on another thread.

[Hibush]

Wahoo's list of actions is a great focus for thinking about what can improve the situation.

Some turnover of colleges is normal, and we should not take that normal and healthy phenomenon as a sign that higher education overall is in trouble. Colleges may be non-profit businesses, even publicly owned businesses. As non-profits, they measure success in societal impact rather than profit. But they are still businesses that have to manage revenue, expenses, investments and loans to remain a going concern. Being businesses, they have to respond to changing demand for their product, competition from newer products, and the economic climate. They will also have widely varying quality of management. Some will go out of business every year. New ones will start.

Research into what is normal turnover and what is crisis is important. If the college equivalent of videotape rental is falling to the college equivalent of video streaming services, then it is normal tech advancement. Painful for the obsolete, but stopping it would be worse for society. If poorly managed colleges are failing and similar well-managed colleges are picking up their students, then the system is working well. The research is difficult because many of the primary sources are ignorant of their situation or concealing problems as best they can.

Building public support is extremely important. We must continuously convey the value of our institutions to the local community, to state legislators and officials (and voters!), to Federal legislators and officials. That communication should ideally be from everyone at the institution in some way. And it should be a steady drumbeat so that the value is ingrained in the general psyche. Obviously, the opposite message is being drummed in now.

I'm skeptical about using  dire straits as the main talking point. The value is a better one. America loves a winner, so announcing that you are not a winner is not a long-term support winner. America also likes to root for the underdog, and likes to come to the rescue. But those are short-term passions.

Alumni can be great. But only at a few places. If a few can get together over lunch and agree to chip in a million dollars each, then they have influence. If they are in the governor's office or on the board of major foundations and corporations, then they have influence. I have not seen other kinds of alumni be a major contributor to saving a school.

[tuxthepenguin]

First - We got into this mess in the US because higher education is largely in private hands. A hundred and fifty years ago, every town big enough to need 2 hookers opened up a college - whether for the religious formation of the clients of said hookers or as a finishing school for the sons and later daughters of the local
squire-archy.  Nebraska has 20+ 4 year schools for a population of under 2 million people.  On the other hand, Montreal Canada is roughly the same size and has 2 English Universities, 2 French Universities and a few satellite campuses or miscellaneous schools affiliated with another institution. 

What do you mean by "largely in private hands"? 85% of secondary education is public, and most of the private is nonprofit.

[polly_mer]

First - We got into this mess in the US because higher education is largely in private hands. A hundred and fifty years ago, every town big enough to need 2 hookers opened up a college - whether for the religious formation of the clients of said hookers or as a finishing school for the sons and later daughters of the local
squire-archy.  Nebraska has 20+ 4 year schools for a population of under 2 million people.  On the other hand, Montreal Canada is roughly the same size and has 2 English Universities, 2 French Universities and a few satellite campuses or miscellaneous schools affiliated with another institution. 

What do you mean by "largely in private hands"? 85% of secondary education is public, and most of the private is nonprofit.

Are you counting students or are you counting institutions?  The non-profit dinky colleges outnumber the public universities in the US.  However, it's true that all the dinky colleges currently enroll a small percentage of the overall US college students.

The public 2-year sector (community colleges) has the largest enrollment.

[marshwiggle]

Not chiming in on your larger argument, but a clarification: Montreal does have only 4 universities. But it also has a few dozen CEGEP's -- roughly the equivalent of grade 12 and a year of college; sort of equivalent to a Junior College / Community College, but not really. The whole system in Quebec is very different from secondary and collegiate systems in the rest of Canada and the United States. In principle, it does some of what you (and Polly) have been lobbying for. In practice, it is cash-strapped, politically volatile, and part of a system that taxes Quebec citizens at a high rate. It is a unique product of the highly idiosyncratic history of Quebec, and an unlikely model for educational reform in any other place.

Part of the cash problem with the system in Quebec is the decades-long tuition freeze which is now untouchable. Ironically, Quebec has one of the lowest post-secondary participation rates in the country.
(Indeed, Quebec is different from the rest of Canada.)

[spork]

Looks like deposits are running about what they were a few years ago, when we missed our target for the incoming class by more than ten percent.

True, but you can't compare this year to any prior year.

[. . .]

Actually you can. And should. Because too many higher ed institutions ignore long-term trends by engaging in optimism bias and assuming "bad years" are one-off outliers. You might be surprised at the number of colleges and universities in the USA that haven't returned to pre-2008 recession enrollment levels.

Bradley University is planning for a 25-35% drop in revenue next year:

https://www.pjstar.com/news/20200406/bradley-university-weighing-40m-in-cuts-after-coronavirus-effect-on-budget

It already had an $8 million deficit for the current fiscal year and has so far had to refund an additional $5 million due to the pandemic.

[Wahoo Redux]

I suppose I am a nerd who thinks of education as much more than a business or job-training model. 

I think of healthy education as more like the church or healthcare or something: essential for a civilized society. 

Sure, there is an economic benefit to a college degree, obviously, and one can point to university research yadda yadda, but more importantly it is one of the prime engines of culture. 

We take college for granted and will let a segment of it collapse with sad but resolute shrug.  Being a nerd, I don't understand this.  America has a history of grass-roots activism as a catalyst for huge change.

We definitely need to look at other countries and what they do, but I also look at, say, Norway and think we are just not the same kind of animal.   

At least Polly and I can agree that it is tiresome to say the same things over and over.

[marshwiggle]

I suppose I am a nerd who thinks of education as much more than a business or job-training model. 

I think of healthy education as more like the church or healthcare or something: essential for a civilized society. 

And even countries with universal healthcare don't support every treatment for every condition under the sun - BECAUSE RESOURCES ARE NOT INFINITE, EVEN FOR PEOPLE WHO WANT TO DO ALL THE GOOD THINGS!!

[Wahoo Redux]

I suppose I am a nerd who thinks of education as much more than a business or job-training model. 

I think of healthy education as more like the church or healthcare or something: essential for a civilized society. 

And even countries with universal healthcare don't support every treatment for every condition under the sun - BECAUSE RESOURCES ARE NOT INFINITE, EVEN FOR PEOPLE WHO WANT TO DO ALL THE GOOD THINGS!!

We don't need nor would we be asking for infinite resources.