As the end of the year is fast approaching and the pandemic is still raging on after almost nine months of wreaking havoc on all aspects of American life, it’s time to reflect on the state of higher education before we head into another year. Even though every school in the country has been affected in one way or another by the pandemic, some schools clearly fared better than others. The ones that survived the pandemic the best and are most likely to thrive in the upcoming year are the ones with the biggest endowments. Think Ivy Leagues, top tier schools, or large state schools with sizeable cash flows. These are the schools that are in the best position to weather any dips in enrollment or huge swings in their investments.
On the other hand, smaller schools did not fare so well. According to Inside Higher Ed, the schools that may not thrive are less-selective religious and rural colleges, liberal arts colleges, and regional comprehensives, especially ones located far from urban, job-producing centers. These types of schools were already wavering before the pandemic, but after it hit, some are just barely on life-support. Moreover, schools that relied heavily on sports and the revenue it generates were similarly affected. According to Brookings, the sports revenue business model that some big-name schools relied on came to a grinding halt when the pandemic hit, quickly drying up a key source of cash flows, and also laying bare many systemic issues with this model.
Notice how there is an eerie similarity between how the pandemic affected higher education and how it affected the U.S. economy as a whole — large systemic issues like equal access to healthcare were exasperated and those with an abundance of financial resources, like Jeff Bezos, fared exceedingly well while those already struggling were only put in a worse situation. The similarities don’t end there. In the same way that we can expect large companies with massive cloud computing capabilities to continue to thrive, like Amazon, we can expect large and well-endowed colleges and universities to come out on top. As small, private schools are shuttered because of financial strain, that leaves the schools left standing to suck up all the remaining current and prospective students. Additionally, those that now cannot afford to lower their tuition will be undercut by those that can, namely schools with large financial reserves.
Don’t worry, there is a silver lining to all this. The funding provided by the CARES Act has undoubtedly saved many colleges and universities from ruin, with Stevens being no exception. On top of this, the massive layoffs caused by the recession have forced many to seek graduate degrees in the hopes of boosting their marketable skills. While it has yet to be firmly established, it is entirely possible that the pandemic may be a boon for many graduate programs. The National Student Clearinghouse Research Center reported that graduate enrollments are up for 21 states, with 15 states exceeding the national growth rate. We may find that schools that invested heavily in marketable graduate degrees before the pandemic will fare quite well in the near future.
So what does all this mean for Stevens? Overall, the road ahead for Stevens is rocky but manageable. Our endowment did take a substantial dip along with other financial strains, like the loss of cash flows from housing. Going forward, this will hurt Stevens not only because we will not have as many financial resources to fall back on, but also because it makes it harder to reduce our already exceptionally high tuition, which makes it harder for qualified students from economically disadvantaged households to accept an offer from Stevens. Additionally, the fact that we are a small school means that the “Stevens brand” may be overshadowed by larger, big-name schools. As mentioned, these schools are in a good position to suck up students in the coming semesters from smaller schools. Furthermore, Stevens is known for relying on international students, especially at the graduate level, and any possible reduction in graduate students or any travel restrictions in the near future could hurt Stevens even more. We already saw something similar to this happen earlier in the year when the Trump administration announced that some international students may not be allowed back into the U.S., although this decision was later overturned. Taking into account that our last academic year was already turbulent enough (who can forget the hacking and all the chaos that caused), the pandemic and its consequences put added strain on our school’s effort to maintain its competitive edge.
But not everything is doom and gloom. Our close proximity to Manhattan puts us in an enviable position. Unlike other schools, we are close to a major urban center that gives our students superb job prospects. This has always been a key edge that Stevens had over other schools, and in the immediate future, our close proximity to New York is going to be more valuable than ever. Additionally, our strong STEM focus puts us ahead of other schools, especially ones that focus on liberal arts. The shift to more tech-focused jobs and computing skills that has been many years in the making has accelerated under the pandemic, and this does not seem to be easing up anytime soon. Consequently, the skills that Stevens’ degrees offer will become even more marketable for our graduates. Lastly, the fact that Stevens did not rely as heavily on generating revenue from sports events as other colleges means that our entire business model did not become unraveled by the pandemic. We did take a financial hit, but not as bad as some other schools. In the near future, Stevens has a long way to go to recover, but there is light at the end of the tunnel.
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