The first indications are in on how the academic year is likely to go. In the pomp and ceremony that surrounds the opening of the school year, deep concerns emerge behind-the-scenes in all but the best endowed institutions as the numbers come in. There are no alternative facts to hide what an institution will face. It’s the “is what it is” moment for America’s higher education.
Colleges and universities have known what the composition of their incoming classes will be since last May when a fairly complete freshman profile emerged. They completed summer renovations on facilities and monitored their multi-year building projects. And they have matched their staff, especially faculty, to the size and needs of the incoming and returning student bodies to keep their student/teacher ratios in line.
But the late summer presents more statistical evidence of what is likely to happen in the coming academic year. The most telling evidence is financial:
- What was the summer melt — those who intend to enroll but don’t arrive — of students like?
- Did the freshman class meet the enrollment projections?
- Did the Office of Financial Aid meet or exceed its budget?
- What will federal and state support look like, especially at public institutions?
- Were capital projects delivered on time and on budget?
Financial Questions Dominate College Leadership Discussions
Since most colleges are so heavily tuition-dependent, these financial questions increasingly dominate senior leadership discussions each fall.
The cold facts are that colleges are capital-, technology-, and labor-intensive institutions. There is very little discretion available to them in an annual budget.
And the numbers will likely confirm soon that net tuition revenue is essentially flat for yet another year. Further, many of them, including some very good schools, did not meet their internal enrollment projections.
The financial model at tuition-dependent colleges and universities that support their people, programs, and facilities no longer works.
Clearly, higher education is going through a process in which it must reevaluate how to pay the bills. There are ways to put the financial pieces together differently, drive efficiencies and cost savings, and look to outside partnerships to reevaluate how to make the educational enterprise work without destroying the historical foundation upon which colleges and universities are built.
Student Residential “Palaces” Symbolize Excesses of College Spending
One example is the Taj Mahal residence hall. These are often spectacular facilities with amenities that exceed anything that most students – even those sharing apartment rents – will be able to afford after graduation. The “build it and they will come” theory of facilities design and enhancements has serious drawbacks. Its presence draws attention to the inadequacy of the current financial model.
These residence halls symbolize the excesses of American higher education, especially the failure of a college to live within the means that would dampen tuition sticker price increases.
The facts are that it is unlikely that higher education institutions need to put so much cash into development of these student residential palaces. If they do, private developers should bear the cost of their construction, assuming that they can maintain quality and create efficiencies that a college is unable to do using in-house expertise to moderate the cost.
In fact, in many cases colleges should be moving out of the student “hotel” business, using a progressive redesign of their student life program to achieve broader institutional strategic objectives that go beyond these luxurious student residences.
Colleges must also find a way to diminish the need both to treat fully depreciated student housing as a cash cow to shore up their general programming and re-capture much of their upper division students for whom they may not currently provide housing.
Focus on What Students Truly Need in Residence Hall
There are larger questions drawn from these trends. When is more just more? And, what do students actually need?
Let’s assume that students need a residence that has decent square footage and is well-maintained. They should be clean, have adequate electrical capacity for their growing number of technology-related products, quiet HVAC for heating and air conditioning, and private or semi-private bathrooms, depending on the configuration of the facility.
That’s enough. They do not need in-house pools, exercise facilities, cafes, or in-suite laundry facilities. That’s too much.
Technology, Connectivity Top List of Student Needs
In fact, if a college or university thinks strategically about what tops the list of students needs, they are likely to hear that it is technology – and specifically, connectivity.
The ability to connect to the outside world is the great leveler for colleges and universities that break down the geographic, social, and cultural barriers that all institutions face in different ways.
This is an area of continuing concern on college campuses. It is a particularly serious problem on rural campus where social and cultural options are more limited. Technology is a large, recurring expense for most colleges, especially since demands shift and technology changes with amazing speed.
Solution Will Require Partnerships
The solution will require new and imaginative partnerships among colleges, business and industry and their providers. It may be that fewer dollars – or perhaps more private partnership dollars – can be put into non-core, non-academic facilities like residence halls to pay for other expenses like technology.
Whatever the solution, colleges must think strategically by looking to the consumer demands of their students and less to the mindless “rock wall” amenities of their competitors.