Higher Ed Dinosaurs Wait and Watch While the Meteors Arrive - Exploring Higher Ed in Decline

 

Yesterday, Glenn Reynolds posted to Instapundit:

OHIO NORTHERN UNIVERSITY DENIES THAT IT’S IN A “HUGE FINANCIAL CRISIS.” Well, wait until the verdict in Prof. Scott Gerber’s lawsuit. . . .

This strikes a chord. From 2002 to 2016 I served at Ohio Northern University (ONU) in faculty and administrative capacities. I was actively involved with student recruiting and admissions issues for the business college. (And, yes, I crossed paths with, and admire Scott Gerber.)

An oversupply of college seats is chasing a diminishing number of college bound high school students.  Undergraduate college enrollment peaked in 2010 (Education Data Initiative; see accompanying graph). 

 The percentage of high school graduates immediately enrolling in a four year college, approximately 44%, remained stable from 2014-2021l (the most recent year for which data are available). 

This declining enrollment meteor has been speeding toward colleges and universities for years.  It is, and has been, a known known.

What to do? A primary response by many institutions is to cut expenses. And, granted, many institutions likely have fat to trim. And, if done strategically, can be part of a comprehensive long term solution.  Unfortunately, my experience is that  budget cut mandates are not approached in a strategic manner.  The institutional plan (hallucination?) is to narrow the budget gap (crater) via cuts alone. Multiple times the provost ordered that I (along with all campus unit leaders/budget managers) cut X% from my budget. No guidance was provided other than a due date to return a budget spreadsheet with a bottom line that is reduced by X%. A key challenge is that higher ed budgets are dominated by personnel expenses. Copier paper and the like account for a negligible percent of the budget.  

During one mandated budget cut adventure (not at ONU), I eliminated the personnel line that supported my administrative assistant. Mature technologies -- I'm looking at you email and Outlook calendar invitations --  obsolesced most of the position's job responsibilities. (No, I didn't need someone to schedule meetings via multiple phone calls and then inform me of the meeting day/time via hand written note!) By eliminating this position, I retained monies in my budget to pay adjuncts that were teaching required course sections persistently enrolled to capacity; sections of program required courses for which we lacked full time faculty capacity to cover. Were these sections not offered, the alternative was to downsize the programs that require the courses. Downsizing the programs would have translated to revenue reduction far in excess of the cost to staff the sections with adjunct faculty. Serving our students by ensuring they can access the courses they need to progress through their program of study in a timely manner is a non-negotiable priority, in my world!

To be clear, strategic budget alignment, where budget is aligned with funding activities critical to mission, is an important tool. However, budget alignment must be done strategically. and it must be done as a complement to strategically driven activities that will s      

Strategic innovation must complement budget realignments. A process for making funding available proactively to fund creating an institution's future is essential.  Innovate! Be entrepreneurial! Create new value propositions. Develop new programs. For example, while at ONU, we identified need in the health sector for individuals with business acumen and life sciences understanding.  The Pharmaceutical & Healthcare Business major was launched to address this opportunity. The major also served as a retention tools for students that entered ONU's PharmD program, but subsequently discovered that the business side interested them more than the being a health care provider. Cultivate new markets. Differentiate. 

Alas, universities generally, and most in higher ed administration, are not entrepreneurial. Few know how to innovate; to create; to look outside the institution; to discover undone jobs to be done; to generate new revenue streams; to recruit the same kind of students to fill seats in legacy programs. Few in higher ed envision a future for their institution, college, or program beyond the status quo; they double and triple down on continuing to do what they have always done. Default mode reigns while the meteor zooms ever closer.

High sticker price, high discount pricing strategy is yet another meteor streaking toward these default mode colleges and universities. NASFAA reports (emphasis added):

the majority of undergraduate students grant aid, which were on average the largest recorded awards yet, with 90.9% of first-time undergraduates surveyed receiving institutional grant aid and 82.9% of all undergraduates receiving grant aid. That aid covered 62.1% and 57.6% of published tuition and fees, respectively. 

Put differently, 9.1% of first-time undergraduates and 17.1% of all undergraduates pay full boat sticker price tuition.  Put simply: a very few are willing to pay the sticker price for higher ed. 

The NASFAA report continues (emphasis added):

The survey of 341 private nonprofit institutions found a 56.2% average institutional tuition discount rate in the 2022-23 academic year for first-time, full-time, first-year students and a 50.9% discount rate for all undergraduates — the highest rates recorded.

Tuition is so overpriced that it is discounted an average of almost 60% to attract buyers! Or, rearranged, first-year students are paying about 40% of the published tuition rate. (Important note: these discounts typically do not apply to mandatory "fees" or to room and board; both are important revenue sources for many institutions).

Parents, at their peril, love to boast to peers about how many 'scholarship dollars' their (soon to be debt-ridden) son or daughter is being offered. "My kid is so smart she is offered a $xx scholarship! I prefer to think of 'scholarships' as tuition discount coupons.  Coupons that lower the price of admission, with the goal of increasing the likely you will attend.  (Perhaps in a future post I'll go into the sausage making of scholarship and financial aid awards).  

I have asked myriad admissions personnel: "Have you considered 'right sizing' tuition to reflect what students pay?"  Consistently I hear responses along the lines of we can't do that because ...

• Parents gotta brag! Prospective students and their parents love the bragging rights about the scholarship amounts. We can't deny them that! And, it's great PR for us! 
  
  
• A lower tuition would lower our perceived quality. Higher price equals higher perceived quality, don't you know! If the published tuition rate were lowered, especially if tuition is lower than competitor institutions, prospective students and parents will perceive we don't deliver quality degree programs.  

How to colleges and universities pay for tuition discounts? Returning to the NASFAA report (emphasis added):

... the majority of institutionally-funded grant aid (56.5%) came from undedicated sources of revenue, while 28.6% came from institutional reserves, and 10.4% came from endowment earnings and withdrawals. Another 4.6% came from gifts or fundraising efforts.

Colleges and universities typically build their budget showing tuition revenue at the tuition "sticker price". To "pay" for the tuition discounting (i.e., to acknowledge that the budgeted tuition revenue is overstated), to balance the institutional budget, a quarter of colleges and universities tap institutional reserve funds. Funds that otherwise could be used to fund innovation, faculty development, efficiencies, or  myriad other activities.  A funding strategy that weakens the institution's financial position. Reserve funds afford an institution resiliency in the face of unexpected events such as government mandated shut downs, unexpected building maintenance, or legal bills generated by an adverse personnel decision. 

Meanwhile many colleges and universities, and sadly ONU is a poster child, sit and wait. They watch the approaching higher ed meteors -- the enrollment meteor; the financial meteor, the pricing meteor, the campus culture meteor -- getting closer and closer.  

For some colleges and universities, it is too late. The higher ed meteors struck with fatal effect. Since 2020, 28 public or private nonprofit schools or campuses have closed or announced planned closures (source: BestColleges). 

The multiple meteors endangering higher ed rapidly approach ONU. Several of the higher ed meteors have made contact, as evidenced by ONU's current budget challenge (or perhaps more accurately 'budget crater'; this isn't ONU's first round of budget cuts requiring personnel reduction). Will ONU survive? That, is an open question.

  

Back in the Bike Saddle After Eight Years - Gear Updates

On Sunday, July 5, 2015, I wheeled my Canondale CAAD10 road bike out of the garage, as I had many times that summer. I checked the tire pressure, adjusted my helmet, started Strava recording on my cell, and headed out.  It was a beautiful summer day. Not too hot with negligible wind (a rarity in Northwest Ohio). I aimed South, down the Slippery Elm multi use trail towards North Baltimore, has I had countless times before.  The out and back loop riding was peaceful, enjoyable and comfortable. 

One hour and 50 minutes, 29.6 miles, and 78 feet of elevation gain later, I was back in the driveway. Little did I anticipate that my next ride on the CAAD10 would be April 7, 2023, almost eight years later. A new job. A move to New England. Life intervened.  Over this period, I did enjoy a few off road trail miles on a fat tire bike. Through pine forests, Sandy soil. Good fun. Fresh air. But not the same as spinning out on the road.  

Job responsibilities no longer a constraint. Another move. This time to the familiar surroundings of mid-coast Maine. Spectacular scenery. Limited traffic. The CAAD10 beckoned to be ridden again. The yearning to feel the wind in my face and road unfold under my wheels reemerged. Time to ride again. 

April 2023. Almost eight years have elapsed since the CAAD10 and I last rolled. I'm now 62. I feel good. But what will it take to get my base back? I'm in decent shape from wrangling cords of firewood, and other household chores. But how will my body tolerate being back on the bike? Only one way to find out. 

Layered up, I rolled out of the drive way. The plan was a seemingly modest 8 mile loop. The air was crisp; in the 40s.  The snow bank lined roads were dry. Ah, the wind in my face! The sound of my wheels rolling over the pavement. After a slight downhill, the first climb arrived.  Shifting to my lowest gear, I worked up the hill.  Winded, I longed for lower gearing. Then down. Whew! Flat for a bit. Then down. Then up. Gear down, gear down, gear down.  Wishing I could gear lower. Legs straining.  Flat. Down. Slight rise. Climb. Although I've driven the loop many times before, I never appreciated the elevation change. Now, from the wheel of a car, does the roughness of the road surface, with many cracks and frost heaves, is not apparent. The hills, seemingly short but long enough to pose a challenge. Especially to legs with no base and bike gearing too high. Another climb. Lowest hear. Struggle. Made it. Flat. Whew! Slight down, then UP. Legs burning, lungs screaming, vision narrowing. I cleared the top of the hill, coasted down the short saddle before the climb resumed, and stopped. Plopping my exhausted self into the roadside snowbank, I phoned home to request a ride. 

Lessons were learned. Riding mid-coast Maine is different from navigating the flats of Ohio, home of the Hancock Horizontal Hundred, billed as the flattest century in the United States, it accumulates 434 feet. Total.  Wind is a near constant companion: sometimes it is a gift; oftentimes it is a curse. Spinning a groove for miles is common. Not here in the mid-coast where flat stretches rarely extend more than a quarter mile or so. Elevation change, up or down, is seemingly constant. 

To accommodate the realities of road cycling in Mid-Coast Maine, changes in training technique and gear must be made. I address training technique changes, adapted to the reality of my 62 year old body, in a subsequent post. First, I'll review gear updates made to accommodate the hills and rough roads that I now ride.  

To ease the hills, I lowered the gearing. I swapped the 11-26 rear cassette (perfect for the flats) for a SRAM 11-32 cassette. A SRAM Rival 22 Medium cage rear derailleur replaced the original derailleur with a cage too short to handle the 32 tooth cassette.  A new chain completed the drive line updates. New brake pads increased the odds I could stop. I also replaced the break and gear shift cables. 

Ohio roads and bike lanes are generally smooth riding. For as long as I can remember, 700x23 Continental GatorSkin tires have graced my rims.  They are durable and grip well in various weather conditions. However, rough roads and 23C tires are a challenging mix. Descending rough roads vigilant for road imperfections to avoid is neither fun nor comfortable.  I first updated to 25C GatorSkins. They provided some improved road shock absorption and road defect protection. But not as much as I had hoped. After a couple hundred miles, I upgraded to 28C Continental GatorSkins.  The 28s provide cushioning and road defect padding that let's me ride more comfortably and confidently when the road gets dicey. 

I've been riding since BC: before cell phone.  My bike electronics tell the tale. The handlebar mounted Garmin Legend H Handheld GPS Navigator, a ride recording, location confirming, direction providing companion since 2009, developed the infuriating habit of shutting off. Randomly. A cell phone in a  jersey pocket faithfully records my rides to Strava. Surveying the "bike computer" landscape in 2023 revealed a world very different than 2015, when I was last riding regularly. All sorts of devices now provide stem-top mapping, ride recording, Strava synchronization, bike data (e.g., cadence, speed; previously provided by mechanical devices), physiological data (e.g., heart rate), notifications of incoming calls and txt messages, etc., in one compact device. 

A Wahoo ELEMNT Bolt V1 GPS Cycling/Bike Computer replaced the Garmin Legend.  This little wonder features a black and white display. I see no need for a power hungry color display. It has worked flawlessly. Every time. And I give kudos to Wahoo for the frequent, (possibly too frequent) software updates that are delivered to the device via WiFi. Slick!

To facilitate training, a Whaoo TICKR chest strap heart rate monitor, which connects to the Bolt via ANT or Bluetooth, replaced an ancient Polar chest strap heart rate monitor (that beeped when certain heart rates were realized, but did little else). The chest strap is as comfortable as one can be.  My first TICKR, after working flawlessly out of the box, refused to connect after a firmware update.  Wahoo declared the TICKR failed and replaced it under warranty. The replacement arrived in two days. And has worked flawlessly. Kudos to Wahoo customer support!

Whelp, that's the bulk of the CAAD10 refitting I've done so far. The CADD10 with SRAM Rival components and a compact crankset, purchased on occasion of my 50th birthday (do the math) is otherwise stock. According to Strava, I've logged a bit more than 3700 miles on the CAAD10. The rims are holding surprisingly well. Speedplay pedals round out the kit. The aluminum frame is surprisingly forgiving. The carbon fiber fork helps considerably. 

Please let me know your questions, suggestions, etc.