Higher education is already feeling the first effects of COVID-19

As I write this COVID-19 continues to gnaw on the human race.  Data is increasingly dubious for a range of reasons (politics, testing, etc.) but the range looks like between 630,000 and 720,000 infected and around 30,000 dead, with both registers rising (WHO, New York Times, Worldometer)*.  In the United States the CDC reports 122,653 infections and 2,112 dead, while the Times estimates more, “at least 135,738” infected and  “[a]t least 2,391” dead.

Did I mention rising?  Here’s the Johns Hopkins dashboard‘s worldwide case graph:

coronavirus comfirmed cases 2020 Jan 21-March 29_JHU

How will that takeoff curve hit higher education?  I’ve been tracking this since the start, and will have much more to say this week.  Right now I’d like to start with evidence of impact.  And I don’t mean campuses migrating face to face instruction online.  We’re already there, mostly, with a few exceptions.

Several campuses have taken drastic steps over the past week, citing COVID-19 as what pushed them over the edge.

The San Francisco Art Institute (SFAI) decided to close.  COVID-19 was the final straw:

The final straw for the faltering institution was when discussions to merge with a local university collapsed after the coronavirus sent the Bay Area into a lockdown. Pam Rorke Levy, the institute board’s chair, estimated the university’s total debt was around $19 million but likely to increase because the school is not earning revenue during the health crisis.

According to the official statement:

SFAI’s leadership has no clear path to admit a class of new students for the fall of 2020. Given our current financial situation, and what we expect to be a precipitous decline in enrollment due to the pandemic, we are now considering the suspension of our regular courses and degree programs starting immediately after graduation in May of this year.

SFAI was already in financial trouble.  The pandemic pushed it over the edge.

Further north, Central Washington University (CWU) declared financial exigency.  This is a very precise term that frees up a campus administration to take all kinds of drastic measures, including terminating tenured faculty members.  At Times Higher Ed forecasts, “it’s likely to make layoffs…”

The official statement makes the pandemic’s economic impact very clear through a detailed breakdown:

CWU anticipates that measures required to inhibit the spread of COVID-19 will reduce overall enrollment through the erosion of retention as well as the recruitment of new students… CWU anticipates the absence of students, employees and visitors will result in a significant loss of revenue that supports bond payments, “System” revenue that is realized through the use of dining services, the Wildcat Shop, residence halls, and other services… the required cancellation of university-sponsored events will result in the loss to the university of revenue associated with conferences, camps, and many other student-life and academic events…

In California Notre Dame de Namur University (founded 1851) announced it would stop admitting new students.  And they are canceling sports!  It’s not a closure per se but really sounds like one.

NDNU intends to remain in operation through the spring 2021 semester.. We are working diligently to build pathways for our students to finish their degrees while we evaluate options for the university’s future.

Why?  They were already in the kind of trouble I’ve been telling you all about for years:

In the face of sharply rising costs in the Bay Area, we have a very modest endowment and limited resources at our disposal. At the same time, we have experienced our lowest enrollment in 30 years, a decrease of 33% since 2013. This has created a dramatic decrease in net tuition revenue while the cost to educate students has increased by several thousand dollars per student.

A 33% decline!  Their official announcement doesn’t mention the pandemic, but it seems likely to have contributed to their decision.  Their classes are already online.

East of Washington, the University of Arkansas Little Rock (UALR) is considering cutting the numbers of its campuses from 5 to 3.  Enrollment and financial pressures have been squeezing that institution lately, and now the pandemic is playing a role:

[Chancellor Christina] Drale expects more money will be cut as a result of fewer expenses, such as lapsed salaries for people who have left but not been replaced and decreased travel amid the covid-19 outbreak. “Of course we don’t know how much this crisis will affect this year’s budget,” Drale said.

Meanwhile, an Illinois liberal arts college announced it would closeMacMurray College (founded 1846) determined that it “had no viable financial path forward amid declining enrollments, rising competitive costs and a small endowment.”  The pandemic played a role in this determination:

The coronavirus pandemic and resulting economic disruption were recent factors that complicated MacMurray’s financial condition, but they are not the principal reasons for the Board’s decision to close, according to [Board of Trustees Chair Charles] O’Connell.

On the east coast, Quinnipiac University decided to cut faculty and staff salaries because of the pandemic:

“The far-reaching disruptions caused by Covid-19 have resulted in significant additional expenses for our university and lost revenues from programs that were canceled,” [President Judy] Oilan wrote in an email to staff members on Monday, March 23.

Is it unsurprising that Moody’s downgraded higher ed’s overall outlook to negative?

As a final thought, here’s the latest epidemic curve graph from WHO:

coronavirus epidemic curve 2020 March 29 WHO

Let me pause for now.  This is a post about evidence, not forecasting.  Forecasting is up next.

Are there other examples out there?  Should I track them?

*Here are the latest numbers from those sources.  Infections: 634,835 – 720,117 – 721,412.  Deaths: 29 957 – 33,925 – 33,956.

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2 Responses to Higher education is already feeling the first effects of COVID-19

  1. Something like 100 universities, including many R1s and several Ivies, have already put in place hiring freezes. Just the first set of steps.

    By the way, it’s interesting to model out not just the declining revenue prospects for the higher education sector but also increasing costs. Revenue declines from fewer international and out of state students; needing to refund room and board; potential increases in financial aid; etc. Cost increases from benefits (health insurance and FMLA); additive expenses associated with online learning if not offset by cuts to employees and expenses associated with residential life/learning; etc.

  2. Dahn Shaulis says:

    The College Meltdown was progressing many years before Covid19. The next ting t watch will be austerity with state-level funding. We could also see a spike in student loan non-repayment, which is already about 50 percent.


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