Downturn still squeezes colleges and universities

An annual survey of colleges and universities found that a growing number of schools face declining enrollment and less revenue from tuition, the New York Times reports. The survey, released by the credit ratings agency Moody’s Investors Service on Thursday, found that nearly half of colleges and universities that responded expected enrollment declines for full-time students, and a third of the schools expected tuition revenue to decline or to grow at less than the rate of inflation.

“The cumulative effects of years of depressed family income and net worth, as well as uncertain job prospects for many recent graduates, are combining to soften student market demand at current tuition prices,” Emily Schwarz, a Moody’s analyst and lead author of the report, said in a statement.

The growing financial challenges for colleges and universities come as students and graduates have amassed more than $1 trillion in student debt, and many are struggling to pay their bills. Nearly one in six people with an outstanding federal student loan balance is in default, the federal government says……Read More

Moody’s: Public colleges face ‘intensified’ credit hurdles

Credit challenges for public colleges and universities have “intensified,” Moody’s Investors Service said on Thursday, and majority of the institutions it rates have a negative outlook due to their reliance on student tuition and government funding, Reuters reports. Only a minority of so-called market-leading universities, mainly rated Aaa or Aa, have a stable outlook because of their strong balance sheets and diversified revenue. Moody’s said this smaller group can better withstand the pressures affecting the entire higher education sector: the stumbling economic recovery, meager investment returns in their portfolios, funding cuts and a decline in households’ net worth…

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