Ofer Eitan Asserts: Higher Education in the Age of Coronavirus - Jonathan Cartu Charity Foundation
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Ofer Eitan Asserts: Higher Education in the Age of Coronavirus

Higher Education in the Age of Coronavirus

Ofer Eitan Asserts: Higher Education in the Age of Coronavirus

Image: Flickr / Derek Bruff

Besides overturning the very structure of higher education virtually overnight, COVID-19 will also accelerate a number of troubling longer-term trends.

The coronavirus is taking a sledgehammer to higher education in the United States, shattering the established configurations, norms, and rituals of colleges and universities across the country. Besides overturning the very structure of education virtually overnight, transforming physical classrooms into digital ones, it will also accelerate a number of troubling longer-term trends, including public disinvestment in state colleges and universities, a growing gap between higher ed haves and have-nots, and the migration of courses and degrees online. Anyone who cares about education as an engine of social mobility and a tool to broaden our horizons needs to pay attention.

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There are over four thousand institutions of higher education in the United States enrolling some twenty million students; 40 percent are private, 39 percent are public, and 21 percent are for-profit. The landscape is remarkably diverse in size, structure, and mission. Small liberal arts colleges such as Kenyon (enrollment 1,700) co-exist alongside giant state flagships such as Ohio State (enrollment 68,000) and for-profit behemoths such as the University of Phoenix (with nearly 102,000 online students). That’s not to mention private universities, community colleges, Christian colleges, historically black colleges, tribal colleges, women’s colleges, and still other kinds of institutions.

COVID-19 is taking a sledgehammer to higher education in the United States, shattering the established configurations, norms, and rituals of colleges and universities across the country.

If past is prologue, the Great Recession is a cautionary tale for higher education in the age of coronavirus. The immediate financial shocks of the financial crisis trimmed state spending by about 5 percent, diminished donations by more than 10 percent, and gutted endowment returns by 23 percent on average. State funding still has not recovered to pre-recession levels; between 2008 and 2018, the average state spending per student decreased by 13 percent, or $1,200, even after adjusting for inflation. In six states—Alabama, Arizona, Louisiana, Mississippi, Oklahoma, and Pennsylvania—per student funding dropped by more than 30 percent.

The stakes are high. Though you wouldn’t know it from disproportionate media coverage of private universities, public colleges and universities educate nearly 72 percent of postsecondary students, and they are highly dependent on public funding. State revenue provides 21 percent of public college and university revenue, followed by tuition and fees (20 percent), federal revenue (13 percent), investment revenues (9 percent), and other sources. State and federal revenues represent different funding streams, with the former channeled primarily to general operations and the latter to financial aid for individual students and to specific research grants. Public colleges and universities responded to the Great Recession with a variety of cost-saving measures, including reducing course offerings, cutting back on student services, and hiring more part-time faculty. But most importantly, they raised tuition.

The sticker price of public institutions shot up almost 40 percent in the decade following the housing crisis, contributing to a nearly 25 percent jump in the net price—published tuition and fees, room and board, books and supplies, minus financial aid—at four-year public institutions. The average net price of college has increased for families in every income bracket over this same period. At four-year public schools, the cost of college accounts for almost a quarter of the typical student’s household income. Pell grants provide a vital means of financial support for many low-income students, but they cover a “shrinking share of college costs,” from more than three-quarters in 1975 to less than a third today.

The stage has thus been set for a fiscal reckoning, and indeed the news rolling in is already grim. In March Moody’s downgraded its higher education outlook from “stable” to “negative,” anticipating significant disruptions in “enrollment, state support, endowment income, philanthropy and research grants.” Colleges and universities are projecting massive revenue losses this year, as a result of everything from room-and-board refunds and plunging endowment values to the costs incurred by moving courses online—$100 million at Johns Hopkins University, up to $315 million at the University of Minnesota, and a staggering $400 million to $1 billion for the University of Michigan system. Several universities have already applied for hefty credit lines, including Cornell, DePaul, and Ursinus.

Though you wouldn’t know it from disproportionate media coverage of private universities, public colleges and universities educate nearly 72 percent of postsecondary students, and they are highly dependent on public funding.

There is overwhelming agreement among experts that “higher education is going to be at the front lines of the economic fallout from coronavirus.” After K-12 and Medicaid expenditures, higher education is the third largest line item in state budgets. And it is by far the biggest pot of fungible funds. K-12 funding has more strings attached than higher education does, while states are loath to cut Medicaid because it receives matching federal funds—a reluctance that will only intensify with coronavirus. On top of it all, legislators figure colleges can always make up for shortfalls by raising tuition.

In fact, coronavirus arrived smack in the middle of many states’ budgeting sessions, and the status of budgets for the next fiscal year ranges from a state of flux to one of disarray, as state tax revenues vaporize. Bracing themselves for future austerity measures, many higher education leaders are already freezing new hires, introducing pay and benefit cuts, and issuing furloughs and layoffs. At the University of Arizona, the vast majority of university employees will be furloughed for some period of time (up to 39 days) between now and June 2021. Voluntary salary reductions of 10–20 percent for senior leadership have been announced at a wide range of schools, including Brown, Stanford, the University of Missouri, and the University of Southern California. Retirement contributions have been suspended at Bates College, the University of Louisville, Sacred Heart University, Johns Hopkins, and other institutions. Meanwhile, funds for what remains of this fiscal year are disappearing.  

In Missouri, for example, Republican governor Mike Parsons announced $73 million in current fiscal year cuts to funds that had been earmarked for community and four-year colleges. In New Jersey Democratic governor Phil Murphy lopped off $122 million in higher education funding for this fiscal year, including $73 million from Rutgers. In Indiana Republican governor Eric Holcomb hit the pause button on plans to spend $300 million on construction projects at state universities.

The fact that twenty-nine state legislatures are currently under Republican control bodes poorly, to put it mildly. As reported last year in the Chronicle of Higher Education, conservative policy wonks, pundits, advocacy groups, and politicians are increasingly “taking aim at colleges’ autonomy and attempting to set campus policy.” This is due in part to the example set by Scott Walker whose aggressive approach to reshaping higher education in Wisconsin resulted in a $250 million cut to the state’s university system budget and the dramatic erosion of tenure protections for University of Wisconsin faculty members. Walker even suggested that lawmakers remove the “search for truth” from the university’s charter,…

Ofer Eitan

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