College budgets…
- Thread starter dawgstudent
- Start date
This is my world and I can tell you the next five years are going to be brutal in higher education.
Mississippi State is in decent shape. IMO we overbuilt some things on campus, but we're okay, even with $350 million in debt. As noted above, you can't say that for everyone.
Some tough decisions are going to have to be made about schools like Delta State, Valley, MUW, etc. There's just not enough students to keep them open.
Mississippi State is in decent shape. IMO we overbuilt some things on campus, but we're okay, even with $350 million in debt. As noted above, you can't say that for everyone.
Some tough decisions are going to have to be made about schools like Delta State, Valley, MUW, etc. There's just not enough students to keep them open.
So, I recognize that Chris King is a troll, but what does student debt have to do with this? Are kids suddenly not taking out loans and going to college? I kinda doubt that.
As someone who is currently going back to finish up my degree, I can concur that the current college experience is a total joke compared to when I went in person 20 years ago. If you fail in today’s college environment you are not trying at all, unless you’re going into specific niche fields. AI has made college a literal joke. I should not be able to go to school full time online along with holding down a full time job and it’s taking me about 2 hours of work per week with school to do that. It’s insanely easy.
As a parent of a college kid and someone highly involved in the lives of a lot of 18-24 year olds that are at various colleges or recently graduated from various colleges, it seems like college is still very wide ranging in quality and value...just like it was when I was in college a quarter century ago.
The shit some of them learned is mindblowing. The shit some of them prepared to take on in grad school and careers is impressive.
And what some others learned and prepared to take on is frankly pathetic.
^ that is how I would describe college 25 years ago too. Many friends and peers learned some amazing stuff and prepared to do some incredible things as adults. And many other friends and peers graduated despite being total 17ups or dummies.
I dont know who this Chris guy is. I assume he mentioned student loans because that is a commonly cited complaint for people who are college graduates and are anti-college and pro-'trades'.
They often complain about how making it easy to get student loans was a bad thing.
Whether that actually has anything to do with the topic they are responding to is often questionable. Its just another opportunity to complain.
Yet each the schools will pay over $20m to for some dudes to play ball. When there is many out there, that would play for free.
hope they all go broke.
hope they all go broke.
Availability of subsidized student loans was a huge driver of the increase in the cost of college. Colleges were very openly discussing the attractiveness of the high cost/high aid model, with the argument that rich people would pay, poor people would get government grants, and middle class would borrow.
If the federal government hadn’t handed out money, you would have seen more colleges trying to compete by keeping the return good than by having the most rock walls and fanciest dorms.
It was way worse that they paired this with making it illegal for employers to use measured intelligence as a screening tool or to make hiring decisions, but somehow perfectly fine to use having a college degree as a screening tool or for hiring decisions.
Agree with all that but has this stopped or something?
Are we dealing with the enrollment cliff i.e. just less students in general?
Its a combo of both. The enrollment cliff is real. I posted the numbers a few weeks ago. Significantly less 18 year olds graduating high school thus year vs. 10 years ago and it will keep dropping. Combine that with a renewed interest in the trades and colleges are fighting for every student.
I consulted a small Midwestern private this year. Enrollment about 1200 students, D3 athletics (no athletic scholarships). They have increased their discount rate from about 45% to 65% in three years. A healthy discount rate (what the average student pays vs. published tuition) is under 50%. I've heard that some Southern schools in the same profile are approaching 70%. Its unsustainable and as Birmingham Southern learned, a tuition reset will not work.
Clemson’s spending issues have been pretty well known for the past year
Don’t be surprised if that number quoted turns out to be higher. It seems like their deficit has increased every time I’ve paid attention…
Don’t be surprised if that number quoted turns out to be higher. It seems like their deficit has increased every time I’ve paid attention…
Gotcha. The amount of some federal loans has been capped. The high education model seemed to be based on ever increasing costs for most schools, so that probably has maybe forced some schools to get a little more honest about their situation. And more prospective college sutdents realizing student loan debt can be an albatross was going to hit a lot of expensive but low prestige schools. But the enrollment cliff is the big one. That's going to make sure there isn't a gradual adjustment to the new reality, but something much more disruptive.
Part of the BBB was some elimination of federal student loans based on the average expected salary of the major. I've seen some folks up in arms about that aspect because of the impact that it will have on things like seminary where preachers just don't make much, or some of the majors in the arts. Heck, it's pretty common for people on path to be an attorney to pursue some liberal art undergrad that might not make the BBB cut. On the other hand, for many of the majors available, no private entity would back a loan if they looked at the financials behind it.
I work with many universities across the State. I also work with companies that work with universities across the US. Colleges are now out there selling an experience. Education is not, but it is now the college experience. Gone are the days of prestige and academic standings, but it is about Greek life and good times. What can I do to get a social media like? If you can offer a good time and experience, you will be just fine.
I would guess it's not unusual for major universities to have debt loads approaching their annual operating budget. Not common but not unusual. The bad news is their endowment is pretty low, very similar to Mississippi State's but State's total debt to endowment ratio is much lower. What really kills these universities is fixed debt payments when enrollment is falling.
Public universitites, by and large, issue revenue bonds that are secured by future income such as student fees and dorm rent. This is one reason the "Student Activity Fee" portion of college expenses has gotten so high. Since a bunch of that is paid for through student loans, easy access to student loan financing has help finance a lot of university projects. If you have a drop in student fees and dorm rent due to fewer people going to college, higher interest rates, and tighter credit, some schools are going to have trouble paying their debt.
I don't think athletic revenue sharing has anything to do with this, but in Clemson's case, it would not surpise me if it is party driven by overbuilding / over estimating long-term enrollment due to some big increases in enrollmenr during their really good football years in the late 2010's.