Historically, higher education weathered these demographic storms by relying on an increase in the college-going rate. What makes this particular cliff so concerning is that we may not have the luxury of relying on higher college-going rates. The cliff reality could be made even steeper by a segment of students and families that are giving up or doubting the ROI of higher education. Career opportunities are drawing students into the world of work directly out of higher school.
Alternative online credentials are luring others away from traditional degree programs. Unfortunately, more students and families now question the value of college and are exploring new routes to learning and career outcomes. This value question was under scrutiny already due to rising costs in tuition and student loan debt; however, it appears to have gained momentum post-COVID and could impact college-going rates. Keep reading because you can do something about this.
Pathways need to be central to your strategy
Creating opportunities for high school students to experience your campus earlier will create an advantage. More dual enrollment programs, weekend coding boot camps, literature events, athletic camps, gaming contests, performing arts programs, mock trial coaching events, and shark-tank business projects are just a few examples of where you might invest. Align those immersive experiences with academic or extra-curricular programs you are confident will drive growth for your campus.
Do not overlook transfer agreements with community colleges in your primary and secondary markets either. The development of pathway programs benefits everyone. You drive more demand while influencing the college-going rates in your primary and secondary markets.
Pathways are important priorities for legislatures at the state and federal levels; you may discover funding sources exist, too. You are not going to market your way around the cliff with simply more direct marketing and social media strategies. Pathway programs are key to the solution and benefit everyone.
You will lose pricing power
NACUBO recently released its Tuition Discounting Study. The average institutional tuition discounting rate increased to a record 56.2 percent for first-time freshman for the 2022-2023 academic year, and 50.9 percent for all undergraduates. These rates already raise questions about how sustainable these discount rates are for most institutions. Unfortunately, the impending cliff will only add significant downward pressure on tuition pricing. While this may signal good news for students and families, it means noticeably less tuition revenue for many colleges and universities, making many campuses particularly vulnerable.
To combat this, make sure you are maximizing your financial aid strategy and operations. It is not just your leveraging strategy, but your financial aid operations and processes too. Consider these questions:
- How timely are your award offers?
- What are your turnaround times on the key steps of the financial aid process?
- Are you staffed appropriately?
- Does your process create a seamless and convenient experience for students and their families?
When considering financial aid, it is not just about the money. A great experience speaks volumes about the value of your campus. No amount of marketing will offset a poor process or experience.
What happens when the enrollment cliff meets higher ed’s staffing crisis?
While COVID accelerated staff vacancies and hiring challenges, the root causes existed pre-pandemic. Today’s staff vacancies and hiring challenges show no signs of letting up anytime soon, pushing many campuses to re-imagine their operating models. This is particularly important for financial aid offices that influence the student experience and are on the front lines of combating the impact of the enrollment cliff. A 2022 NASFAA survey indicated that 56 percent of financial aid offices were operating at reduced capacity and concerned with their ability to meet the needs of students.
A recent industry survey mirrored equivalent results when asked about financial aid operations. Staff retention is important to this enrollment cliff conversation. If you want to retain your students, it starts by retaining more of your staff.
Challenges deserve solutions
The enrollment cliff presents a significant challenge for colleges and universities, but it is not insurmountable. The good news? These challenges have solutions. They come from creating new pathways, empowering your existing team, and applying new operating models and partnerships alongside enrollment management strategies. Combined, these create a framework for a comprehensive solution that benefits students and your campus. The right solution always benefits both.
Related: “Gen P” students remain unsure about college
Robert Heil is the CEO of Financial Aid Services (FAS). Robert brings more than 25 years of higher education and leadership experience as a university administrator, a highly respected consultant and thought leader, and executive for multiple EdTech and consulting firms.
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