In the last decade, elite colleges benefited from big donations, endowments that grew in value and increased popularity. Meanwhile, private colleges without the benefit of rich endowments struggled financially. In the wake of bad press and heightened regulation, for-profits shut down. At the end of the decade, new questions were raised about the fairness of elite college admissions. Here are ten trends that define the last decade in higher ed.
1. The Varsity Blues admissions scandal cast a pall on elite admissions
Lori Loughlin was arrested in 2019.
In March 2019, federal prosecutors exposed the nation’s biggest-ever admissions scandal. They charged more than 50 parents, coaches and exam proctors in a $25 million bribery and cheating scheme to get the kids of wealthy families into elite schools. Defendants included celebrities Felicity Huffman and Lori Loughlin, who paid $500 million to California consultant William “Rick” Singer to get her two daughters into the University of Southern California. The scandal, dubbed “Varsity Blues,” has called into question the fairness of elite college admissions.
2) Struggling private colleges are closing
Since 2016, more than 50 private not-for-profit schools have either ceased operations or merged, according to a study by Emory’s Kevin P. Coyne and Robert Witt, chancellor emeritus of the University of Alabama system. One high-profile example: Marlboro College, which ranked at No. 637 on the Forbes’ 2019 list of America’s 650 top colleges but saw declines in enrollment and tuition revenue before announcing plans in November to merge with Emerson College. A recent Forbes report suggests that more closures and mergers are imminent.
3) Student debt has doubled
According to the New York Federal Reserve, aggregate student debt rose from $750 billion in 2010 to $1.5 trillion. A popular 2007 loan forgiveness measure, the Public Service Loan Forgiveness Program, has since come under fire for rejecting 99% of applicants.
Betsy DeVos has lessened regulations of for-profit schools.
4) For-profit colleges have closed, contracted or merged
The number of for-profit colleges in the U.S. dropped 25% between 2010 and 2018 and the number of students enrolled has fallen by half, to 47,000. In 2014 the Obama administration instituted the so-called gainful employment rule, which cut off federal aid to schools that couldn’t prove their graduates found decent jobs. The rule hit for-profits hard. Though Education Secretary Betsy DeVos repealed the rule in June 2019, many for-profits had already ceased operations.
5) The number of high school graduates has plateaued and is predicted to fall
This major source of college students has mostly stagnated since 2011 and is expected to shrink three of the next nine years. Credit rating agency Fitch notes in its 2020 education outlook that the higher ed industry will face “increasing competition for each college-going student” and that schools reliant on tuition for revenue will struggle.
6) International student enrollment at U.S. colleges has leveled off
According to the Institute of International Education, there were 50% more international students at U.S. colleges and universities in the 2018-19 school year than in 2010-11. But since 2015-16, fewer new foreign students are coming to the U.S. to study, as American college prices rise and nationalist rhetoric increases.
7) Private colleges are increasing discounts
Since 2010, the average discount schools give undergraduates on their tuition sticker-price has risen from 36.9% in 2009 to 46.3% in 2018, according to NACUBO, a membership organization for college business officers. Schools are not always discounting as a charitable measure. Lower prices attract applicants from a shrinking pool.
Stanford is was the most exclusive school in 2018.
8) Elite colleges are becoming increasingly elite
The median acceptance rate at the 25 highest-ranked schools on Forbes’ 2019 Top Colleges list fell from 16% in 2010 to 9% in 2018. Each school’s rate fell, and Stanford’s was the lowest at just 4%.
9) Endowments are up at the richest schools
Endowments grew at the richest schools. Taken together, the endowments of just 26 schools account for half of the nation’s total of $648 billion in endowment dollars, according to IPEDS. That’s up from the 2010 total of $356 billion. Harvard’s endowment of $40 billion, the nation’s largest, is up from $27.6 billion in 2010.
Michael Bloomberg made a $1.8 billion commitment to Johns Hopkins in 2018.
10) Rich people have pledged bigger donations
In the last decade, schools have received 97 philanthropic commitments of $100 billion-plus, up from 34 in the previous decade, according to the Chronicle of Philanthropy. The biggest single pledge came from now-presidential candidate Michael Bloomberg in 2018 when he committed $1.8 billion to Johns Hopkins, his undergraduate alma mater to help fund education for low-income students.
