Top Threats to Higher Ed in 2019
At last month’s Board of Trustees meeting, I shared my list of the top challenges for Susquehanna University. The first six are of concern to most institutions of higher education. The last two vary significantly by institution, region, and sector. They were:
1. Market Disturbance
2. National Association for College Admission Counseling (NACAC) Changes
3. Price Sensitivity
4. International Student Decreases
5. 2026 “Demographic Cliff”
6. Poor Public Understanding of What We Do
7. Geographic Population Redistribution
8. Limited Reputation
Over the next few weeks, I will address each of these in a separate post. They are interconnected in that they all affect “consumer behavior” as it applies to collegiate education.
Threat No. 1 —Market Disturbance
Most colleges and universities have been planning for the “Demographic Cliff of 2026,” when the number of traditional college-age student will drop significantly.
In the absence of war or pestilence, we know how many 18-year-olds there will be for the next 18 years, which is why we know there will be a marked decline seven years from now. Based upon historic behavior and trends, we also know approximately how many of them will enroll in college when they reach that age.
The fall of 2019 presented a surprise to many in higher education, because the anticipated number of traditional-aged students who enrolled in college nationally was 1.7% lower than anticipated. Pennsylvania missed the mark by 2.6%. The disruption that occurred this past year was not only varied by region, but by institutional type.
Nathan Grawe, an economist at Carleton College, has done excellent work on the challenges demographic change will create for colleges and universities. In his seminal book, Demographics and the Demand for Higher Education, Grawe posits that, in general, the most prestigious institutions will be the least susceptible to changing demands.
To a certain extent that remains true, but some colleges (especially in the Northeast), whose enrollments had been historically impervious, saw dramatic declines in first-year admissions. Likewise, some institutions, like Virginia Tech found themselves awash with over-enrollments.
I believe that a number of the threats in the list above are collectively driving the calculus that is shifting the higher-ed marketplace. Many Americans don’t understand what we do in the academy, and the media are steadily undermining public confidence in what remains a significant public good. Families have become far more price sensitive, and international enrollments are in a third year of decline.
These stresses are compounded by the current job market. More young people are entering the workforce in lieu of college. This may be a good short-term strategy for many who plan to matriculate in the next few years.
In many instances, the media suggest that the ROI (return on investment) of a college degree is now a shaky bet; however, this September, at a gathering of university leaders, Joe Barrett, US Midwest and national education editor of The Wall Street Journal, stated that the earnings gap between college graduates and non-graduates is at an all-time high.
Last week, a new report was released by the Georgetown University Center on Education and the Workforce that quantifies the financial ROI of degrees from over 4,500 post-secondary educational institutions. I was proud and not surprised that Susquehanna is among the top 10% for positive ROI.
That is good news, but it is important to remember that the true ROI of a liberal-arts education is not merely economic. It is an investment in lifelong learning, enhanced citizenship, and preparing for a life well lived. These are benefits worthy of investment to which I hope the market will return.