Post by purplehaze on Sept 12, 2019 12:41:34 GMT -5
Saw this article posted on the Bucknell board - very interesting and definitely applicable to HC's position in maintaining a highly qualified applicant pool in the future. Bucknell had to go to their waitlist for about 100 students to fill their class of '23. Various socio-economic factors are laid out in this article and the author basically says 'they are not going away'.
Anyone know how many wait listed students we took in this year, or take in during a typical year ? 100 sounds like a lot.
This year, and last year, HC was worried about having too high a yield, and an entering class size that was too large. I doubt any came off the waitlist, unless a waitlisted student had a particular talent that HC coveted but could not find in the enrolling class; e.g., an oboe player for the band.
The larger point of shifting demographics particularly in much of the Northeast and some of the Rust Belt are valid concerns.
/\ /\ Completely agree. If you are a New Yorker eyeballing Lehigh for engineering, for example, and you see SUNY Stony Brook and SUNY Buffalo are similarly ranked for engineering (and maybe 50K less per year ) it would be no surprise nowadays to pick one of the latter (provided acceptance). FWIW SUNY is now tuition free for New Yorkers from families earning 125K or less.
Last Edit: Sept 13, 2019 16:04:28 GMT -5 by hcpride
Post by KY Crusader 75 on Dec 20, 2019 16:18:41 GMT -5
Rather than start a new thread I thought I'd add this article from Bloomberg News that I found on the web to this discussion on colleges facing big problems
(Bloomberg) -- The challenges facing U.S. private colleges are starting to become their bondholders’ problem, too.
An unusual bankruptcy by New York’s College of New Rochelle this year will likely leave investors recovering only a fraction of what they are owed. A Christian college is asking bondholders to sell back their securities for as little as 10 cents on the dollar to help it emerge from a two-decade fight for survival. Others are defaulting on debt limits contained in bond contracts, a potential harbinger of deeper strife to come.
The troubles have been building at some small, private colleges for years as students grow apprehensive about taking on debt for costly tuition. Moody’s Investors Service has estimated that one in five such schools is under “fundamental” stress, and a demographic shift is threatening to make it worse: by one estimate, the number of high school graduates is projected to stagnate over the next several years and then start falling after 2026, threatening to increase competition for a smaller pool of students. “The size of their market is shrinking,” said Joseph D’Angelo, a partner at Carl Marks Advisors, a firm specializing in debt restructurings. “If we were talking about a business or industry, we’d be going, ‘Oh wow, this is terrible.’”
The pressure is creating a divide in the higher-education system between the prestigious, wealthy schools that draw a large number of applicants and those struggling to attract them. Jessica Wood, a senior director at S&P Global Ratings, said she expects more colleges on the losing end to merge or shut down as a result. “I don’t think there’s an end in sight,” she said.
Ohio Valley University, in Vienna, West Virginia, is trying to avoid that. The approximately 500-student Christian school told investors that “tremendous market pressures” have left it facing an “uphill financial battle” for about 20 years. In June, it offered to buy back its debt for prices ranging from 10 cents to 40 cents on the dollar, depending on the particular security. In September, the school defaulted on debt payments. Mike O’Neal, financial adviser for the college, said the school is still working on the restructuring and declined to comment further.
Still, out-of-court restructurings can be more advantageous to investors and the schools than bankruptcy, which is a last resort because it cuts off crucial federal student aid. The College of New Rochelle in New York filed for Chapter 11 bankruptcy this year. It will end up selling its campus for $32 million, which will cover a little more than a third of its outstanding liabilities. Investors who owned debt issued by Dowling College on Long Island, which went bankrupt in 2016, fared even worse: they recovered an average of 17.8% of what they were owed, according to Moody’s. Others have been breaching the financial terms of their bond contracts. Bethune-Cookman University, a historically-black college in Florida, is negotiating with bondholders to avoid having to repay $16 million of debt early because of troubles tied to a costly dormitory project.
Such technical defaults can be remedied. Azusa Pacific University, a Christian college in California that has seen its credit rating slashed into junk, in 2018 reported that the difference between its revenue and its debt payments narrowed to a level below what it had agreed when it issued bonds. But Ross Allen, chief financial officer for the 10,000 student school, said it has instituted monthly budgeting practices and is using more conservative assumptions to constrain costs. “This organization has turned around so quickly,” Allen said.
The trouble has come slowly over the past decade. Between 2010 and 2017, not-for-profit private colleges saw enrollment grow by about 164,000 students, compared with a 440,000 increase during the previous decade, according to U.S. Department of Education statistics. At the same time, the steady increase in student debt has driven a push by Democratic presidential contenders Elizabeth Warren and Bernie Sanders to make public colleges free, a step that would drastically reduce the draw of many private schools.
For those that can’t compete, mergers may be the only option short of shutting down. Yet they can be difficult to execute. After Mount Ida College in Massachusetts agreed to sell itself to Lasell College, for example, the deal was abandoned after bondholders reportedly balked at the initial terms. It closed instead.
Marlboro College in Vermont may have better luck. Last month, it agreed to be sold to Emerson College in Boston, which will take over Marlboro’s $30 million endowment and real estate worth more than $10 million after the current school year. President Kevin Quigley said it was easier to negotiate a merger because it has an endowment that’s much larger than the $2 million loan it has with the U.S. Department of Agriculture. “We just realized that we couldn’t make it on our own,” Quigley said. It’s a lesson that shouldn’t be lost on others. Some colleges aren’t developing plans for attracting new students until it’s too late, said D’Angelo, the restructuring expert. “It should be obvious that you need to make some changes, and yet people are paralyzed,” he said.
To contact the reporter on this story: Amanda Albright in New York at firstname.lastname@example.org
To contact the editors responsible for this story: Elizabeth Campbell at email@example.com, William Selway, Michael B. Marois
For more articles like this, please visit us at bloomberg.com
Post by Pakachoag Phreek on Dec 20, 2019 16:50:00 GMT -5
The demographic bottom falls out in 2027, which is 18 years after the Great Recession, and there will be no post 2027 recovery because the fertility rate has dropped since 2008. The smaller LACs are screwed.
WASHINGTON — The fertility rate in the United States fell in 2018 for the fourth straight year, extending a steep decline in births that began in 2008 with the Great Recession, the federal government said on Wednesday.
There were 59.1 births for every 1,000 women of childbearing age in the country last year, a record low, according to the National Center for Health Statistics. The rate was down by 2 percent from the previous year, and has fallen by about 15 percent since 2007. ..... Other sweeping social changes have accompanied the delay in childbearing. New data from the Census Bureau show that the median age of first marriage is now 28 for women and nearly 30 for men; in 1970, the median ages were 21 and 23, Mr. Frey said.
Since all the babies who will be 18 in 2027 are already born, the only way to increase the demographic of high school graduate in 2027 and the years (at least through 2037) thereafter is through immigration, in which families with children come to the United States. Not to run afoul of the Dean's proscriptions, I'll simply say that current policies discourage and impede immigration.
I was at a retirement function at Mercy last night. They have absorbed all of the CNR students who could be placed into existing Mercy academic programs...and much of the former CNR faculty. The College of New Rochelle has financial problems for some time, but things went from bad to worse in a 2 year period earning the end of the college. I am glad so many of the students and faculty were able to land on their feet. I cannot see HC ever in such a position financially, but in this day and age, it is not impossible.