Some Current Trends in Higher Education in the U.S. and VirginiaJEREMY P. MARTIN, PH.D.

COLLEGE AND UNIVERSITY AUDITORS OF VIRGINIA CONFERENCE

MAY 7, 2019

1

Some Current Trends in Higher EducationIncreasing Confidence in Institutional Financial Viability

Shifting Sources of Institutional Funding

Trends in Enrollment

2

Increasing Confidence in Institutional Financial Viability

3

52%

56%59%

63% 63%66%

50%

39%

48%

52% 53%

57%

0%

10%

20%

30%

40%

50%

60%

70%

2014 2015 2016 2017 2018 2019

Source: Inside Higher Education’s 2019 Survey of College and University Presidents

Presidents' Confidence That Their Institution Will Be Financially Stable in the Next Five and 10 Years (2019 Survey)

Next 5 Years Next 10 Years

4

66% 66% 66%

81%

60%63%

65%

58%57%

52%

60% 61%

50% 49% 50%

64%

0%

10%

20%

30%

40%

50%

60%

70%

80%

All Public Private Nonprofit Doctoral Master's/Bacc. Assoc. Doctoral/Master's Bacc.

All Institutions, by Sector Public Private Nonprofit

Source: Inside Higher Education’s 2019 Survey of College and University Presidents

Presidents' Confidence That Their Institution Will Be Financially Stable in the Next Five and 10 Years by Institution Type (2019 Survey)

Next 5 Years Next 10 Years

5

53%

47%

57%

68%

53%

44%

62%

54%50%

54%

46%

64%

52% 52%49%

44%

0%

10%

20%

30%

40%

50%

60%

70%

80%

All Public Private Nonprofit Doctoral Master's/Bacc. Assoc. Doctoral/Master's Bacc.

All Institutions, by Sector Public Private Nonprofit

Sources: Inside Higher Education’s 2018 Survey of College and University Presidents and 2018 Survey of College and University Business Officers

Presidents' vs. Business Officers’ Confidence That Their Institution Will Be Financially Stable in the Next 10 Years by Institution Type (2018)

Presidents Business Officers

6

Increasing Confidence in Institutional Financial ViabilityOverall, presidents’ confidence in their institution’s financial viability has been increasing in recent years – both at 5-yr. and 10-yr. outlooks

Public doctoral institution presidents have the greatest confidence in financial viability in the next five years.

Private baccalaureate institution presidents are more confident in their financial viability over a 10-yr. horizon than the next five years.

Private institution business officers are less confident than their presidents in the institution’s financial viability over the long term (2018 results).

7

Shifting Sources of Institutional Funding

8

$8

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$8

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$7

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$7

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$3

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4

$4

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8

$4

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$4

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1

$4

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5

$3

,91

6

$4

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0

$4

,07

4

$4

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8

$4

,38

5

$4

,55

1

$4

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$4

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4

$4

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$4

,96

9

$5

,21

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$5

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0

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6

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$6

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8

$0

$2,000

$4,000

$6,000

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$10,000

$12,000

$14,000

$16,000

0

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10

12

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19

93

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20

10

20

11

20

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20

13

20

14

20

15

20

16

20

17

20

18

Do

llars

per

FTE

Pu

blic

FTE

En

rollm

ent

(Mill

ion

s)

UNITED STATESPUBLIC FTE ENROLLMENT AND EDUCATIONAL APPROPRIATIONS PER FTE, FY 1993-2018

EDUCATIONAL APPROPRIATIONS PER FTE NET TUITION REVENUE PER FTE PUBLIC FTE ENROLLMENT

NOTES: Data adjusted for inflation using the Higher Education Cost Adjustment (HECA). Full-time equivalent (FTE) enrollment equates student credit hours to full-time, academic year students, but excludes medical students. Educational appropriations are a measure of state and local support available for public higher education operating expenses including ARRA funds, and exclude appropriations for independent institutions, financial aid for students attending independent institutions, research, hospitals, and medical education. Net tuition revenue is calculated by taking the gross amount of tuition and fees, less state and institutional financial aid, tuition waivers or discounts, and medical student tuition and fees. Net tuition revenue used for capital debt service is included in the net tuition revenue figures above.

SOURCE: State Higher Education Executive Officers Association

9

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1

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7

$6

,66

1

$6

,81

4

$7

,26

5

$7

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8

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3

$8

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5

$9

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9

$8

,64

9

$6

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2

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0

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8

$5

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6

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$2,000

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0

50

100

150

200

250

300

350

19

93

19

94

19

95

19

96

19

97

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

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20

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20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

Do

llars

per

FTE

Pu

blic

FTE

En

rollm

ent

(Th

ou

san

ds)

VIRGINIAPUBLIC FTE ENROLLMENT AND EDUCATIONAL APPROPRIATIONS PER FTE, FY 1993-2018

EDUCATIONAL APPROPRIATIONS PER FTE NET TUITION REVENUE PER FTE PUBLIC FTE ENROLLMENT

NOTES: Data adjusted for inflation using the Higher Education Cost Adjustment (HECA). Full-time equivalent (FTE) enrollment equates student credit hours to full-time, academic year students, but excludes medical students. Educational appropriations are a measure of state and local support available for public higher education operating expenses including ARRA funds, and exclude appropriations for independent institutions, financial aid for students attending independent institutions, research, hospitals, and medical education. Net tuition revenue is calculated by taking the gross amount of tuition and fees, less state and institutional financial aid, tuition waivers or discounts, and medical student tuition and fees. Net tuition revenue used for capital debt service is included in the net tuition revenue figures above.

SOURCE: State Higher Education Executive Officers Association

10

11

12

Institutional Sources of Revenue (IPEDS)Tuition and fees are revenues from all tuition and fees assessed against students (net of refunds and discounts & allowances) for educational purposes.

Sales and services of auxiliary enterprises are revenues (net of discounts and allowances such as scholarships) generated by auxiliary enterprises that exist to furnish a service to students, faculty, or staff, and that charge a fee that is directly related to the cost of the service (e.g., residence halls, food services, student health services, intercollegiate athletics, college unions, college stores, and movie theaters).

Total operating revenues is the sum of all operating revenues. They resultfrom providing services and producing and delivering goods.

13

Institutional Sources of Revenue (IPEDS)State appropriations are amounts received by the institution through acts of a state legislative body, except grants and contracts and capital appropriations. Funds reported in this category are for meeting current operating expenses, not for specific projects or programs.

Total non-operating revenues represents the sum of all revenues generated from non-exchange transactions.

14

26%

41%

24%

52%

0%

10%

20%

30%

40%

50%

60%

State Appropriations Tuition and Fees + Auxiliary Enterprises

Perc

ent

of

Tota

l Op

erat

ing

and

No

n-O

per

atin

g R

even

ues

Source: Author’s Calculations from U.S. Department of Education, National Center for Education Statistics, Integrated Postsecondary Education Data System (IPEDS), 2017-18, Finance Component. Retrieved from https://nces.ed.gov/ipeds/datacenter on May 4, 20

Percentage of Total Operating and Non-Operating Revenues by Selected Source at Public, 4-yr. Institutions, FY2017

U.S. Virginia

15

Shifting Sources of Institutional FundingIn the U.S., educational appropriations for higher education peaked in 2001 – on an inflation-adjusted basis and remain well below that level as of 2018. This is also the case in Virginia.

In the U.S., enrollment in public higher education peaked in 2012 and has since declined/plateaued. This is also the case in Virginia, though the enrollment peak came in 2011.

In the U.S., student-driven revenues are increasingly the primary source of institutional income. This is also the case in Virginia.

16

Trends in Enrollment

17

98,909

141,591

23,044

33,204

121,953

174,795

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Source: Author’s Calculations from State Council of Higher Education, E2: Fall Headcount Enrollment (1992 thru Current Year)

Headcount Enrollment at Virginia Public, 4-yr. InstitutionsIn-State Students Out-of-State Students

18

-33%

-27%

-16%-13% -10% -9%

-6% -4%

21%

34%38%

46%

59%

89%94%

-40%

-20%

0%

20%

40%

60%

80%

100%

NSU VSU UVA-W RU CNU LU ODU VMI W&M VT UVA UMW VCU GMU JMU

Source: Author’s Calculations from State Council of Higher Education, E2: Fall Headcount Enrollment (1992 thru Current Year)

Change in In-State Undergraduate Headcount Enrollment from Max/Min Value since 1992

19

-33%

-27%

-16%

-13%

-10%-9%

-6%-4%

-40%

-28%

-15%

-11%

-6% -6%

-4%-2%

-45%

-40%

-35%

-30%

-25%

-20%

-15%

-10%

-5%

0%

NSU VSU UVA-W RU CNU LU ODU VMI

Source: Author’s Calculations from State Council of Higher Education, E2: Fall Headcount Enrollment (1992 thru Current Year)

Change in 2018 Undergraduate Enrollment from Peak Enrollment (since 1992)

In-State Total

20

-26% -25%

-5%

-1%

1% 2%

5% 5%6%

11%

17%

28%

-30%

-20%

-10%

0%

10%

20%

30%

40%

NSU VSU RU UMW UVA-W ODU CNU VCU LU VMI W&M UVA JMU VT GMU

Source: Author’s Calculations from State Council of Higher Education, E2: Fall Headcount Enrollment (1992 thru Current Year)

Change in In-State Undergraduate Headcount Enrollment 2011-2018

21

5,470 5,494 4,628

66,067

84,962 85,656

0

20,000

40,000

60,000

80,000

100,000

120,000

Hig

h S

cho

ol G

rad

uat

es (

n)

Source: Western Interstate Commission for Higher Education, Knocking at the College Door: Projections of High School Graduates, 2016.

Projected Virginia High School Graduates by School TypePrivate Public

22

45,339 49,258 47,086

14,930

19,10517,716

2,342

10,996 16,6023,311

6,6499,303

0

20,000

40,000

60,000

80,000

100,000

120,000

Pu

blic

Hig

h S

cho

ol G

rad

uat

es (

n)

Source: Western Interstate Commission for Higher Education, Knocking at the College Door: Projections of High School Graduates, 2016.

Projected Virginia Public High School Graduates by Race/EthnicityWhite Black Hispanic Asian/Pacific Islander American Indian/AK Native

23

67.2%

74.3%

49.7%

71.3%

81.6%

51.4%

38.0%

30%

40%

50%

60%

70%

80%

90%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Source: State Council for Higher Education in Virginia, B08H: Admissions History

Avg. Acceptance and Yield Rates at Virginia Public, 4-yr. InstitutionsIn-State Acceptance Rate In-State Yield Rate Declining Enrollment Univ.-Acceptance Declining Enrollment Univ.-Yield

24

39.4%

22.8%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

<800 800 to 890 900 to 990 1000 to 1090 1100 to 1190 1200 to 1290 1300 to 1390 1400 to 1490 1500 to 1600

Perc

ent

of

En

rolli

ng

Firs

t-Ti

me

Stu

den

ts

Source: State Council for Higher Education in Virginia, B12: SAT Scores by Residence Status

SAT Score Distributions of First-Time Students, 2017-18 IS - All VA Public Univ. OOS - Selective VA Public Univ

At Virginia’s selective public universities, more than 60% of out-of-

state students scored above 1400.

25

Trends in EnrollmentEnrollment at Virginia’s public, four-year institutions has grown significantly since 1992, with some plateauing since roughly 2012.

This growth has been experienced differently among the respective institutions, with some seeing declines from peak enrollments while others have grown rapidly.

Projections for high school graduates in Virginia is relatively stable in the coming years, indicating the competition for in-state students may intensify.

The demographics of Virginia’s public high school graduates anticipates growing Asian and Hispanic/Latinx populations, relative stability among other populations.

Virginia’s selective universities are particularly able to attract talented out-of-state students to the commonwealth, which may become an asset should competition for in-state students intensify.

26

Discussion

27