Current market trends in higher education show that troubled
institutions have been plagued by declines in enrollment, increased market
prices, and poor retention rates. Yet the data shows, as outlined in a new ACE
brief, that less than 10 percent of just over 2,300 institutions nationwide are
in serious risk of closing or merging.
However, the next 20 percent of the market, institutions
that are genuinely struggling but not in immediate danger of closing, also face
challenges, according to an analysis of eight years of the National Center for
Education Statistics’ Integrated Postsecondary Education Data System
(IPEDS) data reported in Too
Important to Fail, Too Big to Be Complacent: An Analysis of Higher Education
Market Risks and Stressors. The publication was produced with the
generous support of the TIAA Institute and was co-authored by Robert Zemsky,
professor of education at the University of Pennsylvania, and Philip Rogers,
senior vice president at ACE.
“We need to move away from talking about predicting which colleges
are on the brink of closure and toward a full and frank discussion rooted in
the facts of the matter,” said Zemsky. “We hope this paper will spark a better,
more nuanced understanding of how the market for an undergraduate education
distributes enrollments.”
In the paper, Zemsky and Rogers outline several strategic
options, particularly the reconsideration of price and costs, but also
encourage a national conversation focused on affirming and strengthening higher
education’s value proposition. Recent Gallup data shows that only 48 percent of
Americans have strong confidence in higher education.
This report was funded by the TIAA Institute and was
inspired, in part, by the desire to build the knowledge base to inform
institutional strategic decisions about the what, when, and why of potential
consolidations or closures and to more broadly support higher education leaders
as they navigate an increasingly complex landscape. The report is part of a
larger collaboration between ACE and the TIAA Institute, designed to surface
and evaluate the implications of economic trends for college and university
sustainability.
Colleges and universities – regardless of market position –
are also being called upon to steer their institutions to be champions of
equity, access, and completion, according to the paper. In a recent ACE
publication, Race and Ethnicity in Higher Education:
A Status Report, data confirm that “too many black students fare
poorly in America’s postsecondary education system,” especially when
considering persistence, dropout, and borrowing rates.
“A purposeful examination of higher education’s market
challenges and value proposition is necessary for our country’s future,” said
ACE President Ted Mitchell. “Higher education has never been more important to
individuals, communities, our economy, and our democracy.”
The paper will be presented at ACE’s next regional summit in
October in Kansas City, Missouri, as part of a panel.