Fear and loathing as colleges face another season of red ink
When the University of California’s Board of Regents got a close look at the numbers in September, it was the visual equivalent of a thunderclap. The massive university system, with 10 campuses and more than 285,000 students, was hemorrhaging money — $2.2 billion in lost revenue and additional costs, mostly due to the pandemic.
While some of those losses came from medical centers that
temporarily gave up high-paying elective procedures in order to treat COVID-19 patients, the bigger picture was as vexing as it was simple: In the age of pandemic-induced remote learning, the campuses were largely deserted. And when students aren’t living on campus, schools stop making money. Fast.
“Colleges and universities get very high premiums on their housing. It’s a big revenue space for them,” said Dr. Jorge Nieva of the University of Southern California’s Keck School of Medicine. “But for many, many schools right now, they just can’t operate in person.”
When they try, the outcomes have often been dire. A New York Times rolling survey of roughly 1,900 colleges and universities has tracked more than 321,000 viral infections on campus among students, faculty and staff, with at least 80 deaths. Most of the fatalities occurred in the spring, and hundreds of schools have since opted for either 100% remote instruction or severe limits on how many students may be on campus.
Those decisions, driven by administrators’ understanding that it’s nearly impossible to contain the spread of
COVID-19 in classrooms, dormitories and cafeterias, are prudent and comply with local and state health protocols. But as schools attempt to finalize plans for the winter quarter or spring semester beginning next month, a sense of dread has crept in. Absent student housing and dining money, budgets again will be blown.
The expected arrival of a coronavirus vaccine is welcome, but at many campuses, students are unlikely to pay for room and board again until the fall — and, even then, perhaps in reduced numbers. Larger schools and private universities with significant endowments will almost certainly get through it, but after that, the picture gets cloudier.
“We’re fully anticipating that some of the smaller schools will not make it,” said Patricia Gandara, a research professor of education at UCLA. “Some of the liberal arts schools, especially, are struggling to stay afloat. It’s a really terrible problem.”
Indeed, a recent model created by a Boston education company, Edmit, estimated that more than a third of the private four-year colleges it studied may need to merge or close in the next few years. New York University professor Scott Galloway, meanwhile, has identified more than 90 colleges that fall into the “low value, high vulnerability” quadrant of his analysis, meaning they’re already in trouble financially and may be pushed to the edge by the budgetary effects of the virus.
The national figures are mind-boggling. In a letter to Congress in October, the American Council on Education said it had estimated that the pandemic would cost colleges and universities at least $120 billion. In every category of university operation, the council wrote, “revenues are down and expenses are significantly increased.”