HE Retention (A Brutal Tally: Higher Ed Lost 650,000 Jobs Last Year)
February 17, 2021
Universities are scrambling to cover unexpected costs of the pandemic while limiting tuition increases, seeing reduced overall enrollment rates, and experiencing a steep reduction in funding. The reported losses are startling, "Harvard is facing a $415 million revenue drop for this year, and anticipates an additional $715 million for the year starting July 1" [1]. Many institutions face the harsh reality that they must cauterize the bleeding of money that they cannot withstand, meanwhile addressing the need for additional revenue streams and increase retention.
College enrollment in fall 2020 is forecasted to be down between 5% to 20%. This decline in enrollment is a significant issue for universities because tuition and student fees make up 82% of private colleges' revenue and 38% for public universities [2]. This estimate is extrapolated based on assumed projections and insights from this fall. College enrollment right out of high school fell by 22% this fall, and enrollment by people over 24 fell by 30%. The latter is likely the resulting from financial hardships due to the pandemic or to provide childcare since many children are doing school online [3].
Colleges are incentivizing enrollment and acknowledging their learners' sensitive financial situations. As a result, tuition and fees experienced the lowest percentage increase in three decades. "Average tuition and fees increased by just 1.1% for in-state students at four-year public colleges... and 2.1% for students at four-year private institutions" [4]. This stall of tuition increases results in further loss of revenue for universities due to the pandemic.
Based on all these factors, the higher education sector is in a perfect storm of a financial crunch. The most significant result of this crunch is the mass layoff of higher education employees. "Since the World Health Organization declared a pandemic, the U.S. Labor Department estimates that American academic institutions have shed a net total of at least 650,000 workers" [5]. 13% of the sector's workforce lost their jobs. This immense loss of employment is well above the national average. The national unemployment rate is 6.3% [6]. The higher education sector experienced over double the average job loss to stem the hemorrhaging of capital necessary for survival. Barbara Mistick, the National Association of Independent Colleges and Universities president, said, "the losses for our sector have just been huge, and they're not going to go away instantly," [7] an unfortunate reality for higher education institutions.
An additional looming threat to higher education institutions is "the potential for multiple years of severe state budget cuts. Forty-six states and Washington, D.C., have constitutional or statutory requirements to balance their budgets" [8]. Deficits are already being reported. "The Center on Budget and Policy Priorities estimates that states will face a $765 billion shortfall over the next three years" [9]. This deficit will affect the federal funding of public higher education institutions. Dramatic budget cuts are already beginning. "For example, public institutions in Ohio have seen their state funding slashed by 3.8 percent, or $76 million" "Ohio State University—the largest institution in the state—faces a $14.9 million loss in state appropriations" [10].
Universities need to provide innovative solutions to survive. They need to provide increased value to their prospective students, current students, and alumni and create new revenue streams to compensate for the losses seen.
How Can Budget Shortfalls Be Better Met, Costs Be Cut Wisely, and New Revenues Be Generated?
94% of surveyed institutions said they spent money on technology during the fall semester. A quarter of surveyed institutions said technology and related training were their most considerable pandemic-related expense. To efficiently use budgets and cut costs, investments in technology must be smart. So, the big question is: How can universities better meet budget shortfalls, cut costs wisely, and generate new revenue streams? The answer is an investment in efficient, effective online systems that can reach new audiences and secure long-lasting relationships that build tuition revenues.
An ideal online platform will provide:
Turnkey customized platform and programs that require no training to start
Efficiency in all systems: AI and advanced technology provides this
Engagement: intuitive design that attracts learners and builds community
Greater revenue to make up for shortfalls: capable of supporting many online revenue streams
A value proposition that sets you apart: better online programs are a way to reach a broader audience and differentiate
Higher education institutions are partnering with online learning platforms to create new and innovative revenue streams and increase the value of enrollment in their institution for their prospective students, current students, and alumni. A smart partnership with an online learning platform that drives revenue will be capable of hosting and creating micro-credentials, summer camps, and alumni upskilling courses, as well as the traditional online course curriculum.
Amesite Offers a Single, Easy to Use, Scalable Solution
Launch a system that helps you build relationships, matriculate students, and maintain operations!
Amesite is a high-tech AI-enabled online learning platform that creates scalable, custom-branded learning environments and content curated by experts in the industry that follow best practices, meeting your university's unique needs. A host of self-paced, highly engaging, and intuitive courses can be ready for your alumni in as little as 30 days.
Amesite can provide your university with numerous revenue streams using turnkey, intuitive micro-credentials, summer camps, and alumni upskilling programs, as well as traditional online course curriculum. All of which require no training and allow your university to take advantage of the immediate needs that these programs satisfy. Amesite is a budget-conscious choice because the is no investment in IT staff or training required to use the platform.
Amesite's system uses established social media formats to help learners access the content in a familiar setting. These mechanisms streamline the learning process. Amesite's platform also gives users the experience of learning with a community, a valuable addition to the online education experience. Connecting virtually to their instructor and other students enhances the experience — and solidifies learning. Amesite has an outstanding and industry-leading 98% retention rate.
A partnership with Amesite is an investment into your university's future. Request a Demo!
Click here to see what Amesite did for Wayne State University as it built its portfolio!
