In furtherance of my earlier post, I think it'd be really interesting to examine what kinds of long-term changes we think might be in store for various sectors of the economy. It seems likely that no matter what, some version of social distancing and reductions in large gatherings will be in place for at least the next 3-12 months. Folks have already posted some great threads on the restaurant industry, the likely increase in work from home and decrease in the commercial real estate sector, and on the resumption of youth sports/activities.
So here's my question to add to these inquiries: how will (and should) this change higher education, a sector of the economy we're all familiar with from our time at Stanford, if nothing else?
Foreign Enrollment
For one thing, there will be a significant decline in foreign enrollments at all levels. At the undergraduate level, that's mostly going to hurt universities in terms of revenue - more and more American universities are dependent on wealthy foreigners who will pay full pop. Will they do so in an era where they can't even be sure whether a travel ban may be put in place back to their home country? Something makes me doubt this. Surely that will result in reduced revenue (see below).
But it could also hurt our ability to attract foreign graduate students, especially in STEM fields. Even back when I was in undergrad my sense was that foreigners made up a disproportionate share of the grad student TAs in Math and Econ, Engineering, etc. Will this hurt our long-term competitiveness in these areas? To some degree, there was already a reduction in foreigners seeking graduate education in the U.S., but this will almost surely be accelerated.
*For those of you who hire or work with foreign-trained STEM grads, how do you think a potential narrowing of the pipeline may affect the U.S. 1-5 years down the road?
Domestic Enrollment
Some of you have already talked about questioning the value of paying sticker for expensive private schools when your kids are sitting the next room over absorbing lectures by Zoom. My guess is we'll see increased enrollment at community college (in part for folks retraining who were laid off), as well as commuter state schools where a lot of students lived at home anyway. I doubt many 18-year-olds would put off college for a year altogether, but I have to imagine that, at the margins, if I live in SoCal, Pomona suddenly looks a lot more attractive than Williams. If I'm choosing between Georgetown and Berkeley and I live in Maryland, Georgetown seems obvious. My suspicion is that we'll see a return to more regional patterns in college attendance that had diminished over the past several decades.
*For those of you with kids deciding on college, or with friends and family who have kids deciding, what are they thinking? I'd be curious to hear how this decision calculus is being made.
Sports and Events
Let's assume residential college education can resume in the fall, which may be a stretch. Even if it does, it seems probable that at least large public gatherings will be off the cards for the remainder of 2020. Does that mean college football and basketball (the revenue sports) play without fans? Or do they push the season back? Some have proposed ideas about moving these sports to truncated spring seasons. To me, that seems preferable to no-fan fall seasons, and certainly from a revenue perspective, doing anything possible to salvage a normal college football season might be essential - it turns out for most schools, college football generates roughly 75-80% of the AD's income.
*What are your thoughts on how college sports should return? No fans? Pushed back to spring? Something else?
Rethinking Funding Higher Ed
Finally, this is probably the most significant of all: with a looming potential great depression, the way we've funded higher education seems untenable going forward. What 18-year-old (or their co-signing parent) takes out $200k in debt for a bachelor's degree that may or may not land them a $35,000 salary if they're lucky? Who takes out a similar quantity of debt for an MBA whose recruiting value may be minimal in 12 months? I have long thought that the price of college and professional education has far outstripped its value and has been sustained only through a combination of fear-mongering ("without a college degree, you'll be doomed!"), federal subsidies (pell grants, federally guaranteed student loans, etc.), and alumni/donor giving. The fear-mongering threats are callow when everyone is unemployed, the federal subsidies may well be diminished once the trillions of CORONA-AID need to start being paid back, and the alumni/donor giving is obviously going to be greatly diminished now that stock portfolios have declined and everyone's belt tightening.
So: what needs to be cut? Where, in your view, is the fat? One trend I've noticed with dismay is the tendency for schools to compete on perks, with an increasing number of sushi bars, climbing walls, and fancy buildings. Another trend has been the vast increase in the number of career administrators who, IMHO, seem to add marginal value. How do we combat these trends, because they add tremendously to the cost of college, but they neither contribute to a well-rounded education nor enhance the capacity to get a well-paid job.
It seems to me now is a good time to ask what the core competencies of a four-year college degree are, and who needs it? Should we be rethinking the operating assumption that everyone should go to college? One dismaying trend I've watched over the past 20-30 years has been the demolition of trade-skills-oriented high school programs. Once upon a time, many high schools prepared students for positions like mechanics, plumbers, and food services where at most a two-year AA degree would be necessary upon graduation. Should we be reconsidering that model?
Offloading Student Debt
Finally, it seems pretty clear to me that my age cohort and the cohort beneath me is going to be completely wrecked by the one-two punch of the Great Recession and now the Great Corona Re/Depression. Our economy depends on people in their 20s and 30s developing the wherewithal to buy homes, have kids, send them to college, etc., as they age into their 30s/40s/50s. How do "young" (40-somethings) do that when they are still serving six-figure debt burdens? I'm sympathetic to the personal responsibility arguments along the lines of "I paid mine off, you should pay yours," but I think we need to face facts that a lot of people got degrees that weren't worth it and they won't be able to pay off. If we don't do something to reduce their payment burdens, I fear a very large chunk of our society will be unable to assume the financial responsibilities of adulthood without family support.
*What if anything, should we do about this? Does this strike you as inequitable and untenable?
I'd be eager for the Cardboard collective brain trust's views on these various issues. :)
So here's my question to add to these inquiries: how will (and should) this change higher education, a sector of the economy we're all familiar with from our time at Stanford, if nothing else?
Foreign Enrollment
For one thing, there will be a significant decline in foreign enrollments at all levels. At the undergraduate level, that's mostly going to hurt universities in terms of revenue - more and more American universities are dependent on wealthy foreigners who will pay full pop. Will they do so in an era where they can't even be sure whether a travel ban may be put in place back to their home country? Something makes me doubt this. Surely that will result in reduced revenue (see below).
But it could also hurt our ability to attract foreign graduate students, especially in STEM fields. Even back when I was in undergrad my sense was that foreigners made up a disproportionate share of the grad student TAs in Math and Econ, Engineering, etc. Will this hurt our long-term competitiveness in these areas? To some degree, there was already a reduction in foreigners seeking graduate education in the U.S., but this will almost surely be accelerated.
*For those of you who hire or work with foreign-trained STEM grads, how do you think a potential narrowing of the pipeline may affect the U.S. 1-5 years down the road?
Domestic Enrollment
Some of you have already talked about questioning the value of paying sticker for expensive private schools when your kids are sitting the next room over absorbing lectures by Zoom. My guess is we'll see increased enrollment at community college (in part for folks retraining who were laid off), as well as commuter state schools where a lot of students lived at home anyway. I doubt many 18-year-olds would put off college for a year altogether, but I have to imagine that, at the margins, if I live in SoCal, Pomona suddenly looks a lot more attractive than Williams. If I'm choosing between Georgetown and Berkeley and I live in Maryland, Georgetown seems obvious. My suspicion is that we'll see a return to more regional patterns in college attendance that had diminished over the past several decades.
*For those of you with kids deciding on college, or with friends and family who have kids deciding, what are they thinking? I'd be curious to hear how this decision calculus is being made.
Sports and Events
Let's assume residential college education can resume in the fall, which may be a stretch. Even if it does, it seems probable that at least large public gatherings will be off the cards for the remainder of 2020. Does that mean college football and basketball (the revenue sports) play without fans? Or do they push the season back? Some have proposed ideas about moving these sports to truncated spring seasons. To me, that seems preferable to no-fan fall seasons, and certainly from a revenue perspective, doing anything possible to salvage a normal college football season might be essential - it turns out for most schools, college football generates roughly 75-80% of the AD's income.
*What are your thoughts on how college sports should return? No fans? Pushed back to spring? Something else?
Rethinking Funding Higher Ed
Finally, this is probably the most significant of all: with a looming potential great depression, the way we've funded higher education seems untenable going forward. What 18-year-old (or their co-signing parent) takes out $200k in debt for a bachelor's degree that may or may not land them a $35,000 salary if they're lucky? Who takes out a similar quantity of debt for an MBA whose recruiting value may be minimal in 12 months? I have long thought that the price of college and professional education has far outstripped its value and has been sustained only through a combination of fear-mongering ("without a college degree, you'll be doomed!"), federal subsidies (pell grants, federally guaranteed student loans, etc.), and alumni/donor giving. The fear-mongering threats are callow when everyone is unemployed, the federal subsidies may well be diminished once the trillions of CORONA-AID need to start being paid back, and the alumni/donor giving is obviously going to be greatly diminished now that stock portfolios have declined and everyone's belt tightening.
So: what needs to be cut? Where, in your view, is the fat? One trend I've noticed with dismay is the tendency for schools to compete on perks, with an increasing number of sushi bars, climbing walls, and fancy buildings. Another trend has been the vast increase in the number of career administrators who, IMHO, seem to add marginal value. How do we combat these trends, because they add tremendously to the cost of college, but they neither contribute to a well-rounded education nor enhance the capacity to get a well-paid job.
It seems to me now is a good time to ask what the core competencies of a four-year college degree are, and who needs it? Should we be rethinking the operating assumption that everyone should go to college? One dismaying trend I've watched over the past 20-30 years has been the demolition of trade-skills-oriented high school programs. Once upon a time, many high schools prepared students for positions like mechanics, plumbers, and food services where at most a two-year AA degree would be necessary upon graduation. Should we be reconsidering that model?
Offloading Student Debt
Finally, it seems pretty clear to me that my age cohort and the cohort beneath me is going to be completely wrecked by the one-two punch of the Great Recession and now the Great Corona Re/Depression. Our economy depends on people in their 20s and 30s developing the wherewithal to buy homes, have kids, send them to college, etc., as they age into their 30s/40s/50s. How do "young" (40-somethings) do that when they are still serving six-figure debt burdens? I'm sympathetic to the personal responsibility arguments along the lines of "I paid mine off, you should pay yours," but I think we need to face facts that a lot of people got degrees that weren't worth it and they won't be able to pay off. If we don't do something to reduce their payment burdens, I fear a very large chunk of our society will be unable to assume the financial responsibilities of adulthood without family support.
*What if anything, should we do about this? Does this strike you as inequitable and untenable?
I'd be eager for the Cardboard collective brain trust's views on these various issues. :)