For years, higher education was in an inflationary trend. Schools raised tuition, enrollments grew, and revenue and donations increased. The number of graduates also grew, and 40% ended up working jobs that required no degree. Americans questioned higher education’s value, and some small schools shut down. But the industry faces much greater challenges now that social mood has shifted to negative and schools confront deflationary trends. Four in 10 potential students say they may delay enrolling, and economic challenges are making it harder for donors to give.
Meanwhile, colleges are having to refund an estimated $8 billion in room-and-board fees to students who are now learning online — a development that also threatens summer class revenue. The American Council on Education says every college and university in the U.S. faces a cashflow crisis, and Moody’s Investor’s Service has downgraded its higher education outlook from stable to negative. Some schools may have to merge or close, and some may have to lower tuition to attract students. Times have changed, but a 2011 article in The Socionomist warned that the education industry was facing a multi-decade peak.
To learn more, read “The Education Industry Shows Sings of Collapse.”
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