Wanted: B.I.C's - Will Negotiate- love, Colleges & Universities
What’s a B.I.C? As defined in my book, ENOUGH! The College Cost Crisis, B.I.C. stands for Bottoms In Chairs. Admissions offices are charged with a simple formula to meet their target money goal. The formula boils down to this- “X” number of students who actually attend, multiplied by the “Z”, or AVERAGE amount of tuition plus room & board PAID per student, equals the “Y” or yield. This money is a huge chunk of their yearly budget. They track admissions, deposits, & projected payments closely from January to September to meet their goals. The pandemic has inflicted a serious wound on every college and university budget.
But, it’s only the beginning.
The January 13 Chronicle of Higher Education article, “How to Survive the Enrollment Bust” gives a behind the curtain look at how Higher Education is looking at the looming B.I.C.problem.
“Before the pandemic struck, colleges were already dreading a “great enrollment crash.” Then came the pandemic, breaking short-term projections and yield models. If only the past year looked more like 2013! The pandemic-induced 13-percent decline in first-time undergraduate enrollments, seen in the fall of 2020, lies outside any projection model. What can we take away from all this?”
Last Fall, I guestimated a 15 % drop in enrollment. Pretty close for an amateur. For example, in a student body of 25,000, they generally admit around 4,500 freshmen. A loss of 13% means 585 fewer students in the undergraduate school. If all are full-time paying an average of $24k of tuition, fees plus room and board, the University just lost $14+ million. But that’s just the start. Lost revenues from sports, concerts, concessions, paraphernalia, are piling up a huge deficit. That will break the budgets of all but the wealthiest schools. According to a professor at UNC-Chapel Hill, about $183 billion nationwide.
The pandemic is masking other declining enrollment trends, too. For example, universities have counted on full-price paying international students for 20 plus years.
First, we have been reminded of the risks of relying on international students. The National Student Clearinghouse Research Center estimates that, in the fall of 2020, undergraduate international-student enrollments fell by 15 percent and new international enrollments declined 43 percent. That rate of decline is breathtaking, and yet according to the Institute of International Education new undergraduate international-student enrollments have declined each year since 2015-16 — with the total loss reaching 12 percent in 2019-20. In other words, this market was weakening even before the pandemic hit.
These talented and financially valuable students often pay full out-of-state rates. This has buttressed college budgets for decades.
A larger view of both short term and long term demographics is even MORE discouraging. The problem is now: From 2000 to 2018, the share of postsecondary enrollments accounted for by non-Hispanic whites steadily declined, from 71 percent to 55 percent. A recent report by the Migration Policy Institute underscores the importance of immigration in this transformation. In 2018, 28 percent of enrolled college students were either first-generation immigrants or their children — up from 20 percent in 2000.
The second challenge began in the shadow of the 2008 Great Recession: Young families began having fewer children. While the economy rebounded, fertility rates did not, and the result was the fewest births in more than three decades. Kenneth M. Johnson calculates that, from 2008 to 2019, 6.6 million fewer children were born than would have been born had fertility rates held steady at 2007 levels. While low fertility has been particularly pronounced in the Northeast, the Centers for Disease Control and Prevention reports deep fertility declines in every region. Colleges — particularly those that serve traditional-age students — can expect to feel the front edge of this fertility decline in the middle of this decade.
Translation: Starting NOW and accelerating through the end of the decade and beyond, quality students who demonstrate college capabilities will be sought by more schools. That means the more your student can bring to the table, the more scholarships and grants may be on that table. This is GREAT NEWS for good students. They want and NEED you. They are more willing to negotiate the price to get you.
And yet, you must negotiate. If they can get you for full-price, they will. There is no guarantee you will get more money, but I promise you WON’T if you don’t ask. Our daughter received a nice scholarship from her eventual alma mater. It did not stop me from asking for more. Wish I could tell you I was successful- I wasn’t. BUT, I am still glad I tried and made sure I left nothing unasked.
What can your student do to boost their chances? So glad you asked!
Have the Best Package- Help your student aim to be in the top “25%” or higher class rank, academically. Have them take challenging courses, focusing on “winning” their best grades in those classes. Make sure they have good study skills and a strong focus on doing well.
Community Service Projects- There are increasing numbers of “leadership” scholarships- and these are awarded to students who make a real difference in an area of need. Raising money for charity, serving the homeless, or leading a service project, can translate into a scholarship for your student. Make sure the school knows about this!
“Unique You“ Money- Sometimes there’s a specialty scholarship. Consider your student’s background, experiences, and yes, even their issues. If I were a student looking for money, I would think about how I am different. Me? I’d ask if there are any scholarships for left-handed people! Yep, I am one of those people. Although we are just 10% of the population, we are a unique group. A left-handed philanthropist may have endowed a scholarship that the right-handed majority forget about. Be creative! Don’t leave money on the table!
As always, be professional. Treat Financial Aid with courtesy and respect. If there is a “no” today, be gracious. They might put you on the “nice “ list. Down the road, you might receive an unexpected scholarship because the student who received it originally is not going to attend. Who cares? Yeah!
To be fair, applications at high-end schools are way up for this fall. That is likely due to those “13 percent” coming back into the student admissions pool from last year. This one-time uptick could reduce options this year. NEVERTHELESS- the numbers of qualified students are definitely shrinking overall. In fact- I’d ask for money Every Single Year- especially if it is a private school.
Next week, let’s go from the Year of the Rat (2020) to the Year of the Ox (2021). Let’s dive into the Chinese Zodiac for ideas about the coming year.
Until Next Time,
All My Best,
Bonnie Burkett
