Gordian Logo RSMeans Data from Gordian

Students, Funding and Facilities: A Balancing Act of Priorities

Students, Funding and Facilities: A Balancing Act of Priorities 1This Executive Viewpoint post is authored by Peter Zuraw, Vice President, Market Strategy and Development for Sightlines, a Gordian company.

Competition is not necessarily a word associated with higher education, a place where collaboration and collegiality are key to personal growth and knowledge creation. Yet competition is all around. The energy that spurred on Villanova’s second triumphant March Madness run in three years was all about the competition loved by so many in collegiate sports.

A current competition worth paying attention to is one for students and their tuition dollars. The impact of these efforts is transforming the campus experience for students and faculties alike.

Both money and students can be harder to come by as of late. The Chronicle of Higher Education recently reported that for the first time, over half of states rely

Surplus can have its own challenges. The growth economies in Texas and California have seen sharp demographic increases, resulting in some university student bodies doubling in size over the past 15 years. The economic downturn a decade ago also brought people back to college looking to reshape their careers and lives. Without enough existing space to handle either surge, a robust building boom ensued. Even the institutions not experiencing population increases are feeling pressured to provide similar new space in attempts to retain students. None of this speaks to the much debated “lazy rivers” and other social amenities being used to create an increasingly complete and compelling student experience. All of this new space requires new resources to maintain it. For those with student population increases, there is at least some money (for now), if it is made available at the budget table. For those without student body growth, they are leveraging an increasingly unclear future in hopes that the investments will yield students and their revenue. Balancing Students, Funds and Facilities

Students, Funding and Facilities: A Balancing Act of Priorities 2Let’s not forget curricular challenges. A 2016 US Department of Education report put numbers to a trend already apparent across the country. Job demand in STEM (Science, Technology, Engineering and Math) will outpace increases in all occupations anywhere from two percent in Mathematics and 18 percent in computer software development, to nearly 50 percent for Biomedical Engineering. Providing spaces to teach these tech focused curriculums and attract top faculty will require even more resources. For large research institutions, federal research dollars and corporate partnerships are creative ways to finance these expansions. For the remaining schools, additional local gift and debt resources are required to provide space for students and their faculty. So far, the STEM demands have not altered the conviction in higher education leadership to maintain a broad educational experience that includes the humanities and social sciences. So while a corresponding drop in resource commitment is unlikely in these areas, pressures of flat budgets or worse, budget cuts, are still present.

It is not clear how long the revenue required to support all of this new space and the new programs will continue to be available. There is hope a surge in adult learners will help to buoy the financial future in the short term. The Education Commission of the United States projects adult learners will grow along with traditional student populations through 2024. Looking beyond 2024, the Western Interstate Commission for Higher Education projected in 2016 that over the next 15 years all western states will see an increase, or at least stay neutral, in high school graduates. But in that same report, the overall national graduating high school class will be smaller by 2032 than in 2013 as a result of significant reductions over much of the eastern half of the country. Fewer applicants may force schools to accept less academically qualified students, who historically have a harder time ultimately graduating. For the institutions with struggling reputations, this could yield a terrible downward spiral.

American higher education has long been highly regarded for its quality, not least of which because of the incredible diversity of offerings, experiences, cultures and ultimately outcomes associated with it. It has seemed possible for nearly everyone to find a path for their own success. Today, the quality and diversity of institutions may be at risk due to forces largely outside the schools’ control.

Faced with challenging enrollment trends and ever-shrinking public contributions, higher educational leadership must focus on what uniquely creates that quality experience for their institution. Developing a strategy for balancing the right resource distribution to people and place will require great care using the information already available and perhaps some yet to be uncovered.