An article was published in Vox recently called, “The Incredible Shrinking Future of College” and it caught my attention. The subtitle intrigued me: “The population of college-age Americans is about to crash. It will change higher education forever.” Cue anything from George Streicher’s Music of the Macabre here. This article left me feeling in a way I’ve never felt in my higher-education-enrollment career: that this time, we wouldn’t be able to market, recruit, discount, or outsmart our way out of a crisis.
The Vox article outlines what most of us in the Academy already know, that, “In four years, the number of students graduating from high schools across the country will begin a sudden and precipitous decline, due to a rolling demographic aftershock of the Great Recession. Traumatized by uncertainty and unemployment, people decided to stop having kids during that period. But even as we climbed out of the recession, the birth rate kept dropping, and we are now starting to see the consequences on campuses everywhere. Classes will shrink, year after year, for most of the next two decades. People in the higher education industry call it ‘the enrollment cliff’.”
Many colleges and universities in western states may not experience “the cliff” as dramatically, due to population fluctuations. And very highly selective elite institutions, along with some flagship publics, will most likely be shielded from it. But the vast majority of colleges and universities in the United States, all tuition-driven, will feel the effects, with some already experiencing enrollment declines.
The enrollment cliff
This topic has been on our minds for some time, but it was this article, bookended by the consulting trips to client campuses we took last fall, that has us talking almost non-stop now about “the cliff.” By “us,” I mean my agency, Echo Delta, and in super-serious, sometimes-accompanied-by-a-bottle-of-wine, conversations with my enrollment consulting colleagues, Jeff Kallay and Scott Rhodes. Combined, we have enough years under our belts to deserve the label “seasoned,” and not one of us can remember a time when the outlook for higher education seemed so bleak.
Everywhere we went, we were told by the school’s enrollment team that the board of trustees or the president had increased their enrollment goals for the fall semester. To be fair, many institutions experienced enrollment declines during the pandemic and are trying to recapture those enrollment levels; however, the goals that were expressed to us were almost always in excess of pre-pandemic numbers. It seems that COVID-era funding, which kept so many places afloat, is drying up, and institutions are desperately trying to find ways to grow (or regrow) revenue. Candidly, we’ve been surprised by the tone-deafness of this “more, more, more” order coming from higher education leadership and wonder if they’re not reading the same stuff we are.
Between a rock and a hard place and another hard place
According to the National Center for Education Statistics (NCES), colleges have likely hit a ceiling in terms of how many 18-year-olds they can coax onto campus. The percentage of young adults with a high school diploma has reached 94%. And the immediate college enrollment rate of high school graduates was flat, right around 70% from 2010 to 2018 before dipping in 2019 and 2020 as the job market heated up for less-skilled, lower-wage jobs.
The National Student Clearinghouse Research Center recently found that undergraduate enrollment fell nearly 6% from 2019 to 2021, with freshman enrollment dropping 13% over that period. Recently, The Bill & Melinda Gates Foundation partnered with Edge Research to explore why this is happening and have published this report. The three themes that stand out are: 1) Students are concerned about college costs, 2) they have questions about the value of postsecondary education, and 3) many are worried about disrupting their livelihoods to attend college.
A recent report from ECMC Group revealed that less than half of current high school students (48%) plan to pursue a four-year degree. An even smaller percentage of these students (45%) believe a postsecondary education is necessary at all.
Yet another report found that Gen Z students are also the least likely of any generation to say they trust U.S. colleges and universities.
With birth rates declining and college-going rates declining, where are all of the “more, more, more” going to come from? Some schools are looking to international markets, but if an institution does not have an international student recruitment plan in place already, it can expect to spend three to five years, and a fair amount of resources, before seeing results. In addition, earning a visa to study in the U.S. continues to be a challenge for many.
Growth is not the answer. Rightsizing is.
Businesses do it all the time: it’s time higher education considered this approach. But don’t downsize and simply make cuts. Instead, rightsize by thinking about what the market demands now and in the next few years. It’s possible to make budget cuts without gutting, or worse yet, cutting out an institution’s heart.
In 2019, George Washington University announced that it was going to rightsize its undergraduate enrollment by 20% over the next five years. The idea was to reduce strain on institutional resources and make the university “better, not bigger.” It seemed startling at the time, but four years later, as we face “the cliff,” it seems both forward thinking and prudent.
Wisdom through experience
Karen Gross, former president of Southern Vermont College, which closed in 2014, has written on the topic of rightsizing colleges and universities. In her writings, she reflects on strategies that she could have employed to save the university. I borrow heavily from her articles that were published in University Business and Age of Awareness:
- Reduce faculty to align with student enrollment. Align faculty in majors with high enrollment and consider adding programs that will be in high demand in the near future.
- Match residence hall capacity with enrollment. Old dorms can be very expensive to maintain, and cost savings could be realized from either tearing down these facilities or renting these facilities to area businesses. If enrollment grows, consider renting nearby homes or space from neighboring colleges.
- Reduce administrative positions. A first step to achieving this is through attrition. Don’t replace open positions that are not absolutely critical to the student experience and the operation of the institution.
- Launch a robust retention program that focuses on retaining first-year students. Oftentimes, these programs can involve a lot of low-cost, high-touch solutions that require a modest investment and can have significant rewards.
- Be mindful not to cut your recruitment and marketing costs. With the approaching demographic decline and the changes to current student and family attitudes toward higher education, the cost to recruit new students will not lessen.
The time is now
Move quickly. Higher education is notorious for moving at a glacial pace, and with the cliff looming, no tuition-driven institution can afford to wait. Resist the urge to create a time-consuming strategic plan; as inclusive and thoughtful as they can be, you just don’t have the luxury of time. Godspeed.