Masking Your Enrollment Issues

John W. Dysart
President
The Dysart Group

Having conducted enrollment audits at hundreds of colleges and universities, I sometimes find difficult enrollment challenges and problematic trends that institutional leaders, board members, faculty and alums have not recognized, or have not taken seriously. Sometimes, problematic outcomes can be hidden by other entities and practices.

Endowments

Up until recently, the stock market has soared. Many individuals, as well as colleges and universities, have benefitted from the extraordinary growth over the last decade. Endowment growth has enabled many institutions to cover revenue shortfalls in some areas with greater draws on investments.

Such growth is obviously not going to continue in the short term as markets have been in free fall. Basic economic realities coupled with unpredictable threats such as the Coronavirus, make it risky to rely too much on investment growth. While events over the last few weeks have been dramatic, it is always risky to rely too heavily on unpredictable endowment growth. At the time of this writing, the market has dropped more than 30% in just weeks!

Fundraising

The growth in the market has also contributed to improved fundraising in recent years for many colleges and universities. While the generosity of benefactors is terrific, it might be dangerous to assume the current giving rates will continue. Both companies and individuals have lost an extraordinary amount of wealth in recent weeks and it is going to reduce fundraising outcomes. The generosity of donors is important, but over-reliance on hiding enrollment revenue declines via donor generosity is dangerous.

Creative Budgeting

Certain constituent groups may not even be aware of budget shortfalls due to declining enrollment, increased financial aid costs or both. Some institutions do not cut budgets and reduce expenditures, even when faced with shortfalls. It is important to communicate any revenue challenges to important constituent groups such as administrators, faculty and board members even if resources are available to cover losses in the short run.

Athletic Recruitment

 

While athletics make for excellent co-curricular opportunities for both players and fans, many colleges and universities are increasing the number of student athletes to stem steep declines from other student types. Institutional leaders should be mindful to track the percentage of undergraduates comprised of student athletes. Roster sizes should be examined to ensure that they do not become bloated. Listing 24 women on the basketball team, for example, is excessive. Over-recruitment of student athletes is likely to translate into growth in attrition rates.

Selected Major Offerings

Some very popular majors can also serve to mask overall declines in other concentrations. If your institution offers Nursing, for example, the popularity of that program across the nation can be tapped for growth. Be careful that success in recruiting nursing majors does not distract from addressing challenges in other academic offerings. Keep in mind that clinicals and accreditation requirements will likely place limits on significant enrollment growth.

The important thing is to understand your current situation in a detailed way. It is helpful to mitigate enrollment challenges in some areas with greater draws on the endowment, additional athletic offerings and popular majors, but understand that there are limits. Short term revenue injections are not going to solve longer term enrollment challenges for most colleges and universities.