美国高校面临生源断崖式下跌与财务危机

Nathan Grawe is professor of economics at Carleton College and the author of the book, The Agile College, How Institutions Successfully Navigate Demographic Changes, and he joins us now from Minnesota. Professor Grawe, great to have you with us, and maybe we could just start by talking about this kind of broader demographic trend. When we talk about the cliff, how precipitous is it? What does it look like, and and how are you seeing that manifest itself at Carleton Colleges and place places like it?

Yeah. So a cliff might be overly abrupt. The reality is that what we're seeing is over the course of maybe fifteen or twenty years, a decline in the number of babies being born totaling about fifteen or sixteen percent. So it's one percent decline one year and another 0.7% decline the next year, but it adds up. For institutions that don't have large endowments, which is most of them, that kind of contraction year after year after year can be really destabilizing.

And there's compounded issues here, right? Because you're seeing a decline in international students partially due to visa complications. Keep in mind, those are students who mostly pay full tuition because they don't qualify for domestic aid. And there's other factors as well, including college is so expensive. A lot of people are looking at doing other things, trade school or skipping it altogether. What does the bigger picture look like, and how big are those factors in comparison to the demographic issue?

Yeah. It's pretty important. If we go back to the, financial crisis just about a decade or so ago, fifteen years ago, and we look since then, we've seen a pretty substantial decline in the number of people going to colleges. It's been focused in the two year sector where enrollments fell by more than one third. A lot of that just reflects a strong economy. We've had very low unemployment with the exception of the pandemic blip, and we've had wage conversions.

Wages at the bottom of the wage distribution have been rising faster than the middle and the top, and that draws some students out of higher ed altogether and into either the labor market or they might choose the trades and get a certificate but not follow through to the associate's degree or a four year degree. We've got those factors that have led to a decline in the number of high school graduates who go on to college.

We've seen a decline of about 10% over the last decade or so, and now we are on this precipice of this decline in the number of young people reaching college going age. So it's a very challenging time with a lot of, as you point out, a lot of different forces converging all at once. Nathan, what does this mean for the schools themselves? How are they, I don't wanna say reacting to this, but kind of changing their business model and their approach with with the understanding that this is is coming?

Think that our colleagues here at Bloomberg have reported on a number of these schools having to close their doors, yes, because of the demographics, demographics, but these compounding factors as well. How is it altering the terrain of of higher education? Yeah. We certainly have seen, an unusual number of colleges that are closing. But even those that are staying open, we're seeing program closures with greater propensity, so we're looking for efficiencies and expenses, but we've also seen more competitiveness in the recruitment.

So while the long term trend has certainly been positive in the cost of higher ed, in the last decade we've seen declines adjusting for inflation both in the sticker price and in the net price that is after the institutional grants are accounted for, and they're meaningful declines. So if we look at tuitions and fees, just the sticker price adjusted for inflation, at public four years that's down 7% in the last decade, and if you look after the grant aids are awarded by the institutions, we're looking at much more substantial declines in the net fee income that the institutions are collecting.

If these trends continue, how does this shake out? Do you see colleges needing to consolidate? Do you see more specializations in certain sectors so they could combine those students, less of a broad based liberal education, a lot of these places because they just can't afford to keep that many different programs? What do you do, and how do you convince kids that this is worth their money? This is worth the debt they might have to incur?

Yeah. I think you're you're nailing it in that it's it's not gonna be a silver bullet solution. We're looking at at forces that are large enough that we're gonna need a lot of different solutions altogether. But at the heart of all of those solutions, we have to think about meeting students more effectively where they're at. And so it does mean making the argument for the return on investment because we know students, as they're considering going to college, care very much about this as an investment, so we have to speak their language and make clear the relevance of what this is to their life after college.

But it also means we have to really promote student success so that we can increase retention rates. It's one thing to draw a new student to campus, but if they only stay for a year, we're really failing that student, but it's also not going to benefit the college's financial position much. If we focus on student success, then we get repeat customers, and that's better for our mission, and it's also better for the financial health of the institution.

Where is the pain likely to be the most acute? I'm gonna go out on a limb here and say that at a place like Carleton, which when I was in high school, I I I heard I I had friends who went there. They told me that there were tunnels through the snow in the winter. Was that cold. Students still go there. You're still teaching there, a very popular and prestigious institution. Is is it going to affect schools like you most, or are there gonna be pain points in other kinds of schools, state schools, technical schools?

Where is this likely to play out most? Well, there certainly are some institutions, and Carleton is is likely to be among them, that are a bit more insulated. The institutions that are accepting just a minority of their applicants obviously can just go deeper into their pools, and that's quite fortunate. But the vast majority of institutions in The United States are these regional institutions. They might be regional publics or they might be private institutions that recruit regionally and they accept the vast majority of the applicants that come.

They're open access institutions. And the private institutions among that group typically don't have large endowments. When we see a decline in the number of young people and a decline in the number of students coming to campus, those institutions tend to feel the pinch most. The public institutions, the public regionals, will also likely experience some real pressure, but of course they have the taxpayer as the backstop and so legislatures will have to make some tough decisions about do we continue funding even if the number of students is declining, but there's at least another lever that those institutions can pull.

Nathan Grawe, was I misled was I misled about these tunnels? Is the snow that high that there actually has to be tunnels between the buildings? It it depends on the year, but I would encourage all of your listeners to come and do a college tour in January. We've got our bald spot. The center of campus is covered with an ice sheet, and you can play broomball and hockey and ice skate. There are lots of great things to do here in the winter.