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Chronicles of Higher Education
Why Haven’t More Colleges Closed?
Prognosticators predicted mass shutterings. That hasn’t happened, but other enormous changes are underway.
By Rebecca S. Natow
March 1, 2021
Last spring’s abrupt, pandemic-induced pivot to virtual learning led to
tremendous financial disruption for colleges. The educational
technology came with a lofty price tag. So did retrofitting campuses to
comply with public-health guidance, with needs for plexiglass dividers,
extra campus cleanings, and personal protective equipment — to say
nothing of smartphone screening apps and the cost of Covid testing
itself.
There were housing refunds to process, reduced revenues from flat or
even decreased tuition pricing, and widespread enrollment declines.
State governments threatened enormous funding cuts, and sometimes
followed through, exacerbating a troubling pre-pandemic trend. The
economic losses have been steep — one estimate comes in at $183 billion
— and although the federal government has provided stimulus funding
with more likely on the way, the amount seems certain to fall far short
of the $120 billion advocates sought.
Observers were quick to grasp the enormousness of Covid’s effects on
our sector. Last March, Moody’s Investors Service downgraded its
financial outlook for higher ed, citing the pandemic as a cause for the
change. In the pages of The Chronicle and elsewhere, experts like
Robert Kelchen, Robert Zemsky, and William R. Doyle sounded dire notes.
Existential perils loomed, it seemed; mass college closures appeared
imminent. Zemsky told The Wall Street Journal in April that the toll
could be as high as 200 closures in a year. In Forbes, Richard Vedder
wrote that more colleges were vulnerable to closure now “than at any
other time in American history” in an article headlined “Why The
Coronavirus Will Kill 500-1,000 Colleges.” Last January, John Kroger, a
former president of Reed College, predicted 100 small-college closures
over the course of a decade. By May, he had revised that estimate
upward: “More than 750 to 1,000” such schools would now “go under.”
Two hundred closures, 500, 1,000 — these predictions steeled us for the
worst. So what has the cost been so far? How many colleges have
shuttered?
Ten — at least that’s the number of permanent closures or
consolidations between the beginning of March 2020 and the end of
January 2021 according to Higher Ed Dive, which has been tracking
college closure announcements. The prognosticators have been wrong, so
far — off by factors of 10 or 20 or nearly 100, though in fairness,
some predictions were for longer time periods.
These 10 have been small, private institutions, and were often in deep
financial trouble before the pandemic. MacMurray College, in Illinois,
said the coronavirus’s disruptions were “not the principal reasons” for
closure. Pine Manor College, in Massachusetts, began a phased two-year
handoff to Boston College to let current and incoming students avoid
disruption. The Pacific Northwest College of Art is on track to become
part of nearby Willamette University, in Oregon.
These changes are lamentable for the faculty, staff, students, and
administrators directly affected, but collectively they represent more
of a glancing blow than the direct asteroid hit many pundits predicted.
Why?
First, a few caveats. For one thing, it’s still early. A year is a
short amount of time in the lifespan of colleges that have existed, in
some cases, for centuries. Closures and consolidations take often years
of planning to bring about. Also, the significant federal stimulus to
colleges may be propping some up just for now, and a wave of closures
is possible if such funding disappears. Still, the fact remains that
the pandemic has not driven a large number of colleges past their
breaking points, at least not yet.
Some of what’s happening fits a longstanding pattern. Should the past
year’s predictions of doom remain off target, they will be in good
company. Prognosticators like the late Clayton Christensen and Earl
Cheit predicted the demise of large segments of higher ed years ago, to
no avail. As it turns out, colleges are remarkably durable.
In a 2017 article in the American Educational History Journal, the
University of Memphis associate professor R. Eric Platt and colleagues
observed that during the Great Depression, only about 2 percent of U.S.
colleges closed, and an even smaller number merged with other
institutions. As the American Council on Education’s Phil Muehlenbeck
and Karina Pineda wrote in 2019, some of the institutions that
struggled in the 1970s, including Boston College and New York
University, are now among the nation’s most well-regarded. In a
November 2020 study, Robert Kelchen found that among private colleges
with risk factors for failure, a wide majority were still operating
four years later. The story here is that American colleges are
strikingly resilient: Even in extremely grim economic contexts they
rarely close — and even when they have the sorts of risk factors
associated with closure.
It is true that a large number of for-profit colleges (more than 1,000
according to a 2019 article) have permanently closed in recent years.
As relative newcomers to the higher-education sector, for-profit
institutions tend not to have the deep roots or many of the
institutional trappings possessed by a lot of their nonprofit
counterparts, which are factors in institutional longevity. Moreover,
for-profit institutions have seen their enrollments rise substantially
in recent months, indicating a possible turnaround for the sector that
may prevent further closures.
While institutions may survive, not everything about them will.
Institutional evolution is an important part of institutional survival.
That is, although many more institutions than expected are likely to
survive the current crisis, they are also likely to adopt fundamental
changes to adapt to resource scarcity, changing markets, and the new
competitive environment. As Platt and colleagues have noted, colleges
throughout history have survived economic and other crises by
rebranding themselves, not infrequently following a merger of two or
more institutions into one. For instance, two New Orleans institutions
in 1930 merged to rebrand as Dillard University. More recently,
Southern New Hampshire University successfully rebranded itself from a
small, private, regional college to a global distance-learning
provider, enrolling over 130,000 students.
Back in 1990, the economist David W. Breneman observed that
liberal-arts colleges had expanded their curricular offerings in
response to market pressure to adopt more “professional” degree
programs, such as business, education, engineering, and health
professions.
In recent decades, increasing numbers of colleges have developed fully
online course offerings in response to changing market demands. Some
colleges have entered into partnerships with business and industry to
help increase enrollments, for example, by providing skills training
for employees of corporate partners or by working with external firms
that specialize in recruiting and serving international students.
Colleges have also reduced or transformed certain programs and
practices in response to evolving environments — as well as to reduce
their costs. For example, over the years, the proportion of tenure-line
faculty has declined while the proportion of lower-cost contingent
faculty has increased. Colleges have also eliminated or restructured
departments and degree programs to make their offerings more marketable
to prospective students. In short, institutions have proved they are
willing to make adjustments, reorganizations, and even substantial cuts
to lower expenses and keep up with market demand. This willingness to
adapt has no doubt been a factor in keeping many colleges financially
afloat.
Colleges have generally been reluctant to drift too far from
institutionalized practices that have been embraced by the sector for
ages, such as tenure. And with good reason: Organizational scholars
argue that holding onto such practices provides institutional
legitimacy, which can in turn bring more resources to an organization.
However, as the examples described above demonstrate, colleges have
shown a greater willingness to adapt to new circumstances than
stereotypes about the sector’s rigidity and reluctance to change would
suggest.
Although most traditional institutions will survive the pandemic
largely unscathed, many will adapt to the post-Covid “new normal” by
instituting new policies or programs and by eliminating others. For
example, Stanford University recently eliminated 11 varsity sports
programs; the University of Vermont terminated its entire departments
of classics, geology, and religion; and the University of Nevada at Las
Vegas recently announced the addition of a new graduate program in
cybersecurity, to address a growing demand for technologists. While
being among the first to make such changes may invite shock and even
resistance, the changes will most likely become more accepted over time
— part of the new normal.
Such changes are plenty painful. Sadly, higher education has already
experienced a large number of cuts in faculty and staff employment in
response to pandemic-related financial losses, both current and
projected. Some institutions have cut back on employee retirement
benefits. And as noted above, consolidations of two or more colleges
have also been announced or are being considered. More cost-saving
measures are likely to come, at least until college leaders have more
clarity about the market demand for higher education in the months and
years ahead.
Institutions are also likely to expand curricular offerings in
post-pandemic high-demand fields, such as health professions and
technology. Also, because colleges have invested so heavily in distance
learning during the pandemic, expect institutions to continue to expand
their online course and degree offerings even after the need for
socially distant teaching subsides. Before our very eyes, we’re
witnessing an enormous, slow-motion change: The academy is becoming a
more frugal employer, a more virtual entity, and less of a home to the
traditional liberal arts — again, extending trends that were already
present before the arrival of Covid.
This, it seems, is change enough for now. If history is a guide, the
vast majority of colleges will survive the current crisis, as they have
survived many other difficult periods in the past. It will be up to us
to ensure that higher-education institutions — in their post-pandemic,
altered forms — remain true to the important missions of centering
student learning, producing valuable research, and adeptly serving
their communities.
Read this and other stories at The Chronicles of Higher Education
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