Colleges and Universities Scramble To Minimize Financial Losses

College enrollments have been steady.
Then, came the virus.

Our nation’s colleges and universities are suffering deep financial wounds as the COVID-19 pandemic enters its sixth month. The devastating results show institutions scrambling to thwart large financial losses and even for some small colleges the possibility of closing.

How large are the losses facing higher education? An ABC News report showed unthinkable numbers. University of Michigan’s three campuses, for example, will see $400 million to $1 billion in losses, while California’s university system lost $558 million in March alone. A major portion of the losses to date stems from rebates on meal and housing that was unused due to campus closings.

So, going forward, it will be more important than ever for schools to focus on capturing a larger market share – getting a larger slice of a shrinking pie. Fortunately, despite a decline in the college-age population nationwide, college enrollments were at least remaining steady.

Statista, a leading provider of market and consumer data, showed public and private college enrollments have hovered around the 20 million mark since 2015. The year 2015 showed 19.99M while 2020 was forecast slightly lower at 19.75M.

However, that was before the COVID-19 Pandemic struck and drastically changed the college experience.  Sadly, The American Council on Education estimates a 15% drop in fall enrollments costing colleges and universities $23 billion in lost revenue.

Even more daunting, SimpsonScarborough, a higher education research and marketing company, is predicting a 20% loss in enrollment based on a survey of 2,000 college-bound high school seniors and current college students in March.

Finally, as students are preparing to go to college (or not), admissions professionals are doing a variety of things to keep their enrollments up.

Here are a few:

•      Extending acceptance deadline
•      Waiving deposits
•      Early access to the waitlist
•      Insurance against dropping enrollment

There’s so much more to this dynamic situation. As the difficulty in attracting a larger number of potential students climbs, it would be wise to have a partner with experience in the higher education market. If you are an Admissions professional, SCG would like to continue the discussion with you.