the higher education mecca of the world – carefully monitored and prepared for the potentially devastating impact that the inevitable drop in college and university enrollment would unleash.
“We’ve been doing it relatively quietly,” Carlos Santiago, the commissioner of higher education in the Bay State, says about efforts to deflect the slow-moving storm that’s now engulfed more than a dozen colleges and universities, pushing them to merge, consolidate or reinvent themselves in other ways to survive.Then something unexpected happened last spring that changed everything: On a Friday afternoon in April, the 119-year-old Mount Ida College in Newton abruptly announced it was broke and planned to shutter its doors after commencement the following month, leaving nearly a thousand students scrambling to figure out their future.
This sudden closure, which until then had been a storyline associated mainly with corrupt for-profit schools, sent a jolt through the state and put school administrators across the country on high alert that declining profits and diminishing enrollment were reaching a stage of crisis.
“The culminating moment was the abrupt closure of Mount Ida, the way it transpired and the real outrage that came not only from the college community but also from parents and Massachusetts in general,” Santiago says.
Within months, Massachusetts officials went from monitoring the effect of market forces on their higher education industry to actively playing a role in mitigating future risks.
In response, Santiago and state lawmakers convened a working group that quickly prepared a report detailing the emergency and outlining eight specific recommendations to ensure that the state – along with students and the campus community, more importantly – isn’t caught off guard again.
Among other things, the recommendations call for a financial evaluation of all colleges and universities to identify those in need of potential monitoring or intervention, a requirement that schools alert students when they are at risk of not being able to operate for 18 months out, and the establishment of an Office of Student Protection.
The recommendations, which were included in legislation filed by Republican Gov. Charlie Baker last week, are slated for full implementation by the fall.
For a state that’s home to hundreds of schools that collectively enroll close to half a million students and employ hundreds of thousands of workers, Massachusetts’s economy is intrinsically linked to the success of its institutions of higher education, perhaps more than any other in the country. Quite literally, it cannot afford more Mount Ida-like closures.
“Our objective is not fundamentally to stop an institutional merger, closure or consolidation,” Santiago says. “It’s really to protect students as best we can. Those are the driving forces.”
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Santiago is quick to note that what happened at Mount Ida, where administrators kept its flailing financials largely secret and did little to ensure a smooth transfer process for students, is an exception. Other schools have navigated much more responsible paths, he says.
Wheelock College, for example, merged with Boston University last year after enrollment dropped and it couldn’t keep up with the cost of operations. For similar reasons, Newbury College in Brookline announced last year that it plans to close this spring, leaving students ample time to transfer. Most recently, Hampshire College in Amherst announced in January that it’s seeking to partner with another institution in order to continue operating.
“Our projected deficit is so great as we look out over the next few years, we couldn’t ethically admit a full class because we weren’t confident we could teach them through to graduation,” Hampshire President Miriam Nelson wrote earlier this month in an open letter to the campus community about future plans. “Not only would we leave those students stranded – without the potential for the undergraduate degree they were promised when they accepted Hampshire – we would also be at risk of going on probation with our accreditors.”
But the Mount Ida experience highlights what many in the higher education space have been sounding the alarm over for years: The higher education apocalypse is coming. And the steady drip of crises in Massachusetts and across New England – Southern Vermont College announced abruptly earlier this month plans to close – may just signal its arrival.
“Colleges and universities will have too much capacity and not enough demand at a time when the economic model in higher education is already straining under its own weight.”
Some forecasters, including famed Harvard Business School professor Clayton Christensen, predict as many as half of all universities will close or go bankrupt in the next decade. The crisis is largely driven by declining enrollment facilitated by the Great Recession, which resulted in a significant drop in the U.S. birthrate. Scholars estimate that nearly 2.3 million fewer babies were born between 2008 and 2013, which, when combined with an expansion of higher education offerings in the decades preceding that, mean too many slots compared to the number of applicants.
Economist Nathan Grawe, who coined the term “birth dearth” in his 2017 book, “Demographics and the Demand for Higher Education,” estimates that the number of students graduating from high school in New England who are then likely to enroll in four-year colleges and universities will be 24 percent lower in 2029 than it was in 2012.
In fact, just seven years from now, he estimates, there will be 32,000 to 54,000 fewer college-aged students in New England, which has both the lowest fertility rate and highest concentration of colleges in the country.
In Massachusetts’ case, Santiago says, the vast majority of colleges are doing OK. But many of them, especially the small, private liberal arts schools, have been operating similarly to how someone might live paycheck to paycheck, some having survived that way for 20 years or more at this point.
The new monitoring strategy, which Santiago describes as part science, part art, will allow the state better oversight of those slipping into the red.
“We will have metrics and we will have indicators, but until you have a conversation with the individual institution, you’re really not going to know,” he says. “What makes this different from what we’ve done in the past, is that in the past we’ve been really reactive. We want to be more proactive.”
While most of the closures are impacting smaller private schools, which are more dependent on tuition, larger research universities and schools with major endowments are also taking note and positioning themselves strategically.
Case in point: Earlier this month, the five-campus University of Massachusetts system, which has a $874 million endowment, announced the launch of an online degree program specifically designed to address immediate workforce needs and target adults who have some college credits but never earned a bachelor’s degree.
“Even if UMass can maintain our enrollment trend line – even if we significantly increase the number of out-of-state and international students we attract to Massachusetts – if there are 15 to 25 percent fewer college students overall, we will be challenged to meet the demands of the workforce,” president of the university and former member of Congress Marty Meehan said during the state of the university speech earlier this month.
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Meehan, who guaranteed Mount Ida students acceptance to his university’s Dartmouth campus after the school closed and UMass bought its property, has been a vocal leader in addressing the enrollment crisis.
“Colleges and universities will have too much capacity and not enough demand at a time when the economic model in higher education is already straining under its own weight,” he said. “Make no mistake – this is an existential threat to entire sectors of higher education. And New England, unfortunately, is ground zero.”
The entire saga has prompted some to ask whether endangered schools are worth trying to save.
“That’s a tough question to answer,” Santiago says. “There are some people saying, ‘Let them fall off a cliff.’ It’s not quite that easy. Many of these institutions are anchors of their communities. In some respects, they are the only major employer in a particular region.”
To stem the tide, some schools, like the University of Massachusetts system, are looking to technology as a path forward. Other places, like Georgia State University, have focused on improving graduation rates of their students, finding that for every 1 percent improvement in persistence the school sees $3 million in kept tuition and fees.
Other schools have tried selling property or deferring maintenance costs, though neither strategy has bought much time. In the waning years of Mount Ida’s existence, the school deeply discounted tuition – by as much as 65 percent – in order to drive up enrollment. But the strategy backfired as it ended up losing money on every student who enrolled.
Many describe the situation as a storm that colleges and universities need to figure out how to weather until enrollment bottoms out.
“Enrollment is going down,” Santiago says. “It’s been going down since 2010 and will continue to do so until 2030. But it will come back. It will come back at some point.”
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