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Top Colleges See Little Fall in Freshman Commitments

Jared Hobson — Mon, 11 May 2009 04:37:32 +0000

Jacques Steinberg of the New York Times reports today that Top Colleges See Little Fall in Freshman Commitments.

Unsurprisingly, students offered admission to Harvard, Yale, Princeton, and Pomona are accepting those offers at more or less the same rates as in years past. All of these schools have increased their financial aid budgets this year over last to ensure that yields stay constant.

But as Steinberg admits, only a small fraction of colleges have reported yield rates, and many colleges (including the likes of Georgetown) still have room in their freshman classes. The effects of the economic meltdown on college enrollments still remain to be seen, and we’re several weeks from having a full understanding of how the economy will affect both college budgets and the experience of the students who do matriculate.

Stay tuned.

Great College Advice
Independent College Consultant

May 11 UPDATE: According to an article in today’s issue of The Dartmouth, Dartmouth College’s yield was 2% lower than last year, forcing the admissions office to pull 50-60 students off the wait list. This is not a huge decline, and probably something that would have made the news, were it not for the kooky economic situation.

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Declining Enrollments: Your Opportunity

Jared Hobson — Tue, 23 Dec 2008 06:51:35 +0000

Today’s New York Times includes an article about worried admissions officers across the land, especially at private colleges, who are noticing steep declines in the numbers of applications. Conventional wisdom has it that the financial aid picture is so bad that students dare not dream of attending a private school for fear of being unable to afford it.
While it is true that some of the credit options for parents are a bit sketchy, college still have plenty of financial aid to give away–and perhaps fewer applicants to whom to give it.
What does this mean for you? Well, it means that if you have played your cards right by applying to colleges that are both good fits for you and also likely to accept you, it’s altogether possible that your aid package may be sweetened as an incentive fo you to attend.
If admissions officers sense that they will have a hard time attracting good students, they may rejigger their aid offers in order to ensure that the size of their class does not decline.
It’s also possible that we will see a lot of movement on waiting lists this year, as colleges move to fill their classes in May. This will primarily benefit students who are able to pay and who are not seeking large financial aid packages.
The students I really worry about are the ones who have applied to state colleges in the belief that this is the only place can afford. Not only will classes be super-crowded at state colleges in the fall, but some will not be accepted. And as state funding dries up, some public colleges are capping enrollment. Some may actually accept fewer students in the past, leaving students who thought of their state college as a “safety” school are left hanging.
While it’s impossible to forecast all the craziness that this admissions season will bring, it’s important that students and their parents not lose their senses. Good planning and a good strategy for admissions and financial aid will leave many folks with a variety of good options to choose from once those admissions letters come out in early April.
Mark Montgomery
College Counselor

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Falling Markets & College Budgets: Mergers Ahead?

Jared Hobson — Mon, 27 Oct 2008 16:50:42 +0000

Forbes posted an article on October 22, foretelling hard times in the country’s higher education industry. With falling stock markets, declining endowments, and some colleges having loaded up with debt in the past decade or so, the article predicts that some colleges may be swallowed up by financially stronger competitors, or will at the very least face some very tough financial difficulties in the next few years.

The evidence is a September 2008 study by the National Association of Independent Colleges and Universities, in which one-third of the 504 member institutions surveyed indicated that the credit crunch had hurt enrollment. About 20% of respondents said they had fewer returning students than expected, and roughly the same number said they had a smaller incoming freshman class than expected.

Clearly the credit crunch is hurting individual families, and economic logic would have it that these individual decisions will have an impact on the higher education industry, as demand falls for high-priced tuition at private colleges and universities. I’ll have more thoughts on that story later this week.

As demand falls, some colleges that were not as conservative with their investments and did not leverage their future in favor of immediate gratification may begin to feel the financial pinch. Moody’s is watching college budgets and investments carefully, and according to an article in the Chronicle of Higher Education, three colleges are on a “watch list” to have their bond ratings downgraded. The colleges in question are Simmons College, Franklin Pierce University, and Suffolk University.

Many other colleges will feel some pain. But, as I said in an earlier post, most colleges have acted more like the pecunious ant than the spendthrift grasshopper. The report from Moody’s bears this out, as seen from this quotation from the Chronicle article:

In its report, Moody’s said that the “overwhelming majority” of colleges have dealt with the freeze with “only minor budgetary or liquidity adjustments.” It attributed colleges’ general resilience to their conservative management strategies, their access to lines of credit and quasi-endowment funds, and their holding of fixed-rate debt.

So I’m not betting that many colleges will go belly up or that we’ll see a bunch of college mergers. Maybe a few exceptional cases will make the headlines, but the vast majority will weather the storm. It won’t necessarily be a leisurely cruise; but most boats won’t sink–even as the hurricane roars overhead.

College Counselor

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