THE IMPACT OF COVID-19 ON HIGHER EDUCATION
Jeanne Harrison, Vice President and Senior Analyst at Moody’s Investors Services, highlighting the financial impact of the pandemic on higher education, wrote: We expect rated universities in all of our current jurisdictions- US, Canada, UK, Australia, Singapore, and Mexico- to enroll fewer students for the next academic year than planned, due to the outbreak.”
On April 16th, the New York Times reported t
hat higher education trade groups have predicted a 15% decrease in enrollment nationwide in the United States, amounting to a $23 billion revenue loss.
In a recent survey of nearly 3,000 students intending to study in Canada, more than half (54%) are planning to defer their admission for a year. Another 15% have changed their plans and are no longer planning to study in Canada.
In a survey published in The Pie News on April 15th, 42% of students surveyed indicated they had no interest in studying online. The same survey revealed that 46% of the 11,000 international students surveyed said the virus has impacted their study plans.
On April 14th, Studyportals published survey results that indicated 40% of potential international students were changing their study plans. Three weeks ago the figure was 31%. The same survey revealed that 83% of respondents believe their travel plans will be restricted and 68% think their parents’ savings will decrease because of the virus.
Several colleges and universities in the United States, including Boston University and the University of Oklahoma, are considering cancelling in-person instruction for the fall term. Beloit College is considering starting the fall term later than usual and holding two seven-week modules instead of a single semester.
The University of Connecticut created a one-credit course, “The COVID-19 Pandemic Impacts on Health, Business, and Society. More than 4,000 students enrolled in the course.
Minnesota State University expects to cut 10 majors and more than 160 positions to defray a projected $6-million budget deficit in the 2022 fiscal year.
The president of Harvard will take a 25% salary cut. The president and provost of MIT will each take a 20% cut.
On -the horizon-trend? Some legislators in Pennsylvania are questioning if the state needs all 14 colleges and universities. Will consolidation follow? Will other states, in the face of state budget deficits, do the same?
The College Board has cancelled the June SAT examination. More than 50 colleges and universities have announced that SAT scores will no longer be required for admission. Schools include: Tulane, Virginia Tech, Swarthmore, Williams and the University of California, system-wide.
Officials for the SAT and ACT are in the process of creating digital versions of their tests that students can take at home.
Economic Indicators Impacting Future Higher Education Enrollment
China’s GDP shrank 6.8% for the first quarter of 2021, the first decline since 1992.
COVID-19 job losses in Asia could force 11 million people into poverty.
As of April 16th 22 million Americans, or 13.5% of the labor force, were unemployed. This represents the worst level of unemployment since the Great Depression.
Investment income in the United States, represents 9% of revenue at private universities, and 2.5% at public schools. The Hechinger Report noted last month that 75% of the $630 billion in endowment funds at U.S. institutions are invested in stocks, whose value has plunged since the pandemic’s onset.
Declining investment returns, along with federal and state budget cuts and a decline in the number of enrolling international students, will make it necessary for colleges and universities around the world to shelve their strategic plans and create vision plans. What will your school look like after some semblance of normalcy returns and how can you communicate your vision with future applicants and students?
More to come on that subject.