April is the cruellest month
-TS Eliot, 1922
In March – which feels so long ago – I described various ways the pandemic could injure higher education’s finances, pushing some colleges and universities to make painful cuts, while others stepped closer to the abyss.
It wasn’t the most imaginative or counterintuitive forecast I’ve ever written. And now we see the first wave of COVID-19 cuts in higher education.
They occur across the United States, hitting every kind of campus, from well-endowed research universities to state universities, liberal arts colleges, and community colleges. The cuts take a range of forms, from layoffs to furloughs to compensation reductions:
- Antioch College furloughed 27 staff and cut hours and/or compensation to others.
- Atlantic Cape Community College laid off about 100 staff who could not work remotely.
- Bob Jones University furloughed an unspecified number of staff.
- Boston University laid off more than 1600 student workers.
- Bristol Community College laid off 136 part time workers.
- Drew University furloughed some staff.
- Guilford College furloughed 166 people, or “[s]lightly more than half of the college’s 250 non-faculty employees.”
- Harvard University froze all kinds of raises and projects, while cutting the salaries of its president, VP, and provost.
- Johns Hopkins University announced a series of cuts, including this strategy: “divisional leaders will exercise their discretion and have to consider furloughs or layoffs when necessary to meet their financial and strategic objectives in such a constrained budget environment…” They may face a $375 million deficit this fall.
- Kent State University called for a 20% budget cut, which will be carried out by “reducing operating budgets by 20%, enacting a hiring freeze, postponing new campus construction projects, … reducing spending on athletics,” and cutting senior administrator salaries.
- Keuka College furloughed an undetermined number of staff while issuing wage cuts.
- Lake Superior State University will apparently commence layoffs.
- Lewis-Clark State College ended around 16 staff positions and is working on cuts to faculty.
- Marquette University furloughed around 250 staff, notably those who could no longer work remotely.
- Merrimack College laid off 30 staff.
- Oakland University cut salaries of several senior administrators.
- Ohio University announced it would lay off 140 staff. “This (is) our first significant personnel reduction,” [Carly Leatherwood, a university spokesperson] said.”
- Portland State University will furlough 106 staff.
- Rochester Institute of Technology will furlough some staff and “is prepared to introduce a salary reduction program.”
- Rutgers, State University of New Jersey, cut senior administration compensation and signaled it would hire fewer adjuncts this summer and fall.
- Smith College cut or requested voluntary cuts to some senior administrators’ compensation.
- Southern Oregon University furloughed 395 staff.
- Syracuse University cut some staff compensation and froze merit pay increases.
- Union College furloughed 30% of its staff.
- The University of Akron announced plans to cut academic programs and student athletics.
- The University of Alaska will furlough 166 administrators.
- The University of Arizona announced furloughs and pay cuts to a range of employees. It also withdrew financial aid packages to grad students.
- The University of Kentucky furloughed 1700 staff, nearly all in medical care.
- The University of Louisville furloughed “some employees and will institute pay cuts for those earning at least $100,000…”
- The University of Massachusetts Medical School furloughed 100 staff.
- The University of Michigan called for cuts to senior administrator compensation as well as voluntary staff furloughs, based on expecting at least a $1 billion loss.
- The University of Missouri laid off more than 40 people, mostly in their hospital.
- The University of Montana laid off 63 staff (although the headline says “furlough”).
- The University of New Haven cut staff and faculty compensation, furloughing some.
- The University of Oregon laid off 282 people.
- The University of Rochester announced it would cut some senior administration compensation and furlough some staff.
- The University of Tulsa furloughed a number of staff, focusing on those who cannot work remotely. UT also had its senior leaders have their compensation hit by “a reduction of the equivalent of two weeks of our salaries…”
- Several University of Vermont senior administrators saw compensation or support cuts.
- The University of Wisconsin system will furlough staff and also laid off some number of student workers.
- Valparaiso university furloughed 200 staff and encouraged faculty to take salary cuts.
- Western Michigan University laid off more than 200 staff.
Also:
- The National Governors Association and New America published a guide on how states can handle college and university closures.
- The majority of campus presidents in an AAC&U poll said they expected to cut staff:
- Vermont State Colleges’ chancellor tried to consolidate campuses, but was driven to resign instead.
I have come across other accounts of impending cuts that I can’t cite here – yet – because they were shared with me in confidence and have not been publicized.
A few reflections on this list: faculty members have largely been spared. Cuts have fallen on staff instead. There are few signs of structural or programmatic change. Many of these are temporary measures.
Have you seen others to add to this list? Is this something I should make a point of tracking? And what do you think of the steps taken so far?
(thanks to Michael Nietzel, Stephen Jacobs, Tony Moretti and many others)
I have yet to see any Universities offering early retirement to staff. They would save on those salaries, and the only thing they would need to pay for would be health insurance depending on the schools policies.
Good point, Amanda!
Our school had offered early retirement in the fall. Swore that was it. But did bring it back one more time.
We might see waves of it, Hetty.
Were rumors about Miami University OH layoffs confirmed?
Last I can find is stories about partial refunds, Jennifer.
Watch the College Meltdown in real time.
https://collegemeltdown.blogspot.com/2019/02/workers-expose-subprime-college-crash.html
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We have to develop a more sophisticated analysis of higher education. Clearly, some of the economic principles of higher ed have to be evaluated and reevaluated. What principles should we examine to understand the complexities of College Mania! and the College Meltdown? Here are some ideas that I have.
Higher education participation is not always countercyclical.
Pricing varies a great deal and it’s not transparent.
People make “rational” and “irrational” decisions (e.g. Chivas Regal effect) about college choice.
Irrational decisions are influenced by changing social and cultural beliefs, marketing, propaganda.
Consumers can be ambivalent about college choice, feeling that education is too high, but spending the money anyway.
Higher education should lead to better paying jobs, but this is often untrue.
Many consumers have limited college choices that are rational and many that are irrational.
Classical economics still play a part (e.g. supply, demand, elasticity, friction). For example, since brand name higher education at the undergrad level has a large demand from rich people, and a limited supply, pricing can still be raised. This does not hold true for most higher ed, which has an enormous supply and a decreasing demand, especially in a nation increasing in social inequality, and decreasing in social mobility even among college graduates.
Labor is not as large of a factor in higher education as it once was.
Technology has limitations in providing learning. Does it also have limitations in providing decent jobs?
These are good ideas, Dahn.
By “Labor is not as large of a factor in higher education as it once was” are you referring to adjunctification?
Baylor made some changes to their budget.
Martha, can you say more?
What about universities that have large online programs? See this feature about Liberty University (https://www.nytimes.com/2018/04/17/magazine/how-liberty-university-built-a-billion-dollar-empire-online.html), which has both a private campus and a large online presence (student numbers).
There is also this article which considers student perspective: https://www.cnbc.com/2020/05/03/online-schools-thrive-amid-college-campus-closures-due-to-coronavirus.html
And of course there is the 2020 US News & World Report for Online Programs, which is a favorite source of information for parents and students alike (https://www.usnews.com/education/online-education). It’s interesting that some of the schools that made it into their top 5 lists are also listed above as laying off faculty.
Wholly online institutions have a big advantage over the rest, with established practices and structures.
The larger universities with a large online presence have questionable outcomes. And they cut corners by replacing faculty with facilitators and robots. https://collegemeltdown.blogspot.com/2019/12/the-higher-education-assembly-line.html
I am an adult student seeking to finish my BA in Poli Sci online. Very few of these are available and why? I am an honors student seeking a quality experience, not the quickest path to the degree. This would be a good time for schools to get on board with offering quality online degree programs. People want this, especially right now, and most schools only offer the same tired BS in Business and Nursing, a plethora of masters degrees and they love selling the online “certificates.” That’s if they have anything at all online. They’ve learned a lot about distance education this past semester & should get on this. They’ve all been way too slow on this and now they’re holding the bag in panic for revenue.
Secondly, this would be a good time to LOWER PRICES on everything, starting with tuition, online & on site. They all need to reassess the real world value of what they offer, stop padding the salaries of their presidents and examine the costs of multi billion dollar passe athletic programs.
Good points, Lynn.
I think there’s a lot of pressure to lower prices… and a lot of nervousness about that.
We need more mentoring of people in making college choices. What good is a degree for most people if it does not lead to gainful employment?
Alert! Faculty and Staff face a Hobson’s Choice if and when their institutions call them back to work!
See Question 40.
https://home.treasury.gov/system/files/136/Paycheck-Protection-Program-Frequently-Asked-Questions.pdf
40. Question: Will a borrower’s PPP loan forgiveness amount … be reduced if the borrower laid off an employee, offered to rehire the same employee, but the employee declined the offer?
Answer: No. … [but] to qualify for this exception, the borrower must have made a good faith, written offer of rehire, and the employee’s rejection of that offer must be documented by the borrower. Employees and employers should be aware that employees who reject offers of re-employment may forfeit eligibility for continued unemployment compensation.
Good catch.
First wave, then second wave, then the third wave ….
Here’s what it looks like in real time.
https://babel.hathitrust.org/cgi/pt?id=uc1.b4085065&view=1up&seq=581
Cf. Figure 103. These successive waves of growth (left to right) are now being reversed due to Covid-19 (right to left). Where will the new set-point be along this reverse-growth curve?
This interesting diagram appears in Pearl and Reed (1924, 575), and depicts a series of successive population S-curves arranged tail to head. They are refered to as “epochs” or “cycles.” As one growth process wanes, another begins. Rarely, if ever, are the separate logistic curves this easily distinguished. More likely, they are simply silhouetted by a single cumulative curve, which is the additive result of all sub-dominant curves. In fact, most growth curves are the summation of numerous indistinguishable underlying curves.
In the Covid-19 case, divestment and deinstitutionalization will track the growth curve in reverse. Where on this curve will the new “normal” equilibrium point be located? Will higher ed be recognizable ?
Glen and Bryan, let’s all pretend we didn’t see it coming.
https://collegemeltdown.blogspot.com/2020/05/lets-all-pretend-we-couldnt-see-it.html
http://collegemeltdown.blogspot.com/2017/05/charting-college-meltdown.html
http://collegemeltdown.blogspot.com/2019/06/enrollment-declines-campus-closings.html
https://www.linkedin.com/pulse/us-education-racket-dahn-shaulis/?trk=mp-author-card
And a decade before that was edububble.com, available in wayback machine, archive.org
Glen, I’ll have to take a few snips of that. Along with that take a look at Richard Freeman’s 1976 classic “The Over-Educated American.”
https://collegemeltdown.blogspot.com/2019/07/college-meltdown-resources.html
Thanks! This is new to me — I found 2 reviews that I’ve printed. Thanks!
That’s a fine set of resources, Dahn.
Glen, what led you to that text?
Pearl is the grandfather of population statistics.
https://en.wikipedia.org/wiki/Population_ecology
The logistic also tracks diffusion of innovation.
https://en.wikipedia.org/wiki/Diffusion_of_innovations#/media/File:Diffusion_of_ideas.svg
this is super helpful Bryan. Thanks for putting this together.
1. It seems really important that we have some “shared sacrifice” model in this. So many are not advocating for any furloughs for faculty and/or pay cuts, apart from the most hghly compensated.
2. It seems a TIERED system of pay cuts and furloughs would be the most equitable way to go. Our institutions have become increasingly inequitable: adjunct/tenure, or exempty/non exempt etc., and no surprise falls along racial divides.
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