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Colleges face 'pain ahead' amid COVID: Expert

Yahoo Finance discusses the state of college enrollment and U.S. education with Doug Shapiro, National Student Clearinghouse Research Center Executive Director.

Video Transcript

- So colleges and universities are hoping to put the weight of the pandemic behind them and for a good reason, as a recent report showed a record decline in spring enrollment, uh, this year according to a new report from the National Student Clearinghouse Research Center. The springs overall college enrollment was down 3.5%, which was seven times worse than last year right when the pandemic first started disrupting normal life. That was the worst decline in student headcount since the group started tracking enrollment data.

And for more on that, let's bring in the executive director of the National Student Clearinghouse Research Center. Doug Shapiro joins us, alongside Yahoo! Finance's Aarthi Swaminathan for more on this. And, Doug, I mean, obviously, that's the springtime. A lot of people are looking ahead here to the fall, trying to figure out maybe what the appetite is to get back on campuses.

You still, though, have to deal with, uh, in many cases vaccine pressure. And solving that, also potential testing. What do you think we're at in terms of, I guess, prospective students weighing the pros cons here?

DOUG SHAPIRO: Well, you know, this has been a-- a very frightening year for higher education and, uh, the only-- the only student groups that that group were among graduate students seeking master's and professional degrees. When we looked at just undergraduates, the decline was-- was 5%, about 727,000 fewer students, on, uh, campuses this year. And I think the fears were that it was going to be much worse. Almost all of the decline though was clearly the result of the pandemic.

You know, the number of students, uh, in college has been shrinking very slowly, uh, but steadily in recent years, mostly due to demographic shifts. But this year's drop was really like falling off a cliff, about 10 times as steep as pre-pandemic for undergraduates. And the hardest hit by far were freshmen and students at community colleges. Uh, community colleges fell by 10%, almost a half a million students.

And we know that the community colleges serve the most low income and disadvantaged students, the ones who most need more affordable options for attaining higher skills and credentials that will help them advance in the workforce, and yet they're the ones who are missing out the most. And I fear that they will continue to suffer going into the fall of this year.

AARTHI SWAMINATHAN: Doug, can speak a little bit as to how enrollment affects the college's finances? And we've seen inflation sort of, um, affect-- tuition is not increasing that much. So can you speak a little bit about what happens when a community college loses 10% of its students?

DOUG SHAPIRO: Well, it's very painful for the colleges, there's no question. And we've seen a lot of downsizing and, uh, even some colleges starting-- starting to consolidate and merge with-- with, um, neighboring institutions. I think that, you know, even if the trend doesn't continue next year, the fact that so many fewer freshmen showed up last year, in some sense, the damage is already done for next year. That freshman gap, which was 20%, actually, at community colleges, one in five, uh, freshmen who we expected to show up for the first time last fall did not-- didn't make it.

That gap will echo through the years, uh, for colleges for years to come. There will be fewer second year students next year, uh, fewer juniors in-- in-- in 2022, and even for four-year institutions, fewer transfer students coming from community colleges and entering bachelor's programs. So even if enrollments snap back this fall, uh, there will still be pain ahead continuing for the colleges.

AARTHI SWAMINATHAN: Doug, one of the big reasons for that financial hit a lot of these four-year universities took was because of the lack of international students, especially with the borders closed. What does it look like on that front right now? And is there enough to really get, uh, a lot of these universities that relied on the tuition, oftentimes full tuition, from international students-- what's the outlook for this year?

DOUG SHAPIRO: Well, it's still very uncertain. I mean, the-- the situation with the virus, as you know, is changing very quickly and travel restrictions in many cases are being reimposed. So it's very hard to say. And I think a lot of, uh, international students and their colleges are-- are very concerned about this.

AARTHI SWAMINATHAN: Doug, um, when you look specifically look at 2020, 2021, what has gotten you most concerned, just looking across the data and not just specifically at-- at the types of schools affected?

DOUG SHAPIRO: Well, again, the-- the-- my biggest concern is about, uh, low income and minority students who have traditionally, uh, enrolled in community colleges that did not show up this year. And, uh, you know, the level of opportunity, um, that these students have to get ahead is-- is-- is a very narrow-- comes in a very narrow window. So, you know, when we see half a million fewer community college students on campus today, um, that-- that decline, which is particularly steep among Black and Hispanic and Native American students, and even worse especially for men, whose numbers fell by twice as much as women, I'm concerned that many of these students have entered the workforce in whatever low wage jobs they could find to support their families during the pandemic, thinking probably that they can go to college later.

But the fact is that that gets harder and harder to do the longer you're away from school. And in the meantime, they will continue to fall further and further behind economically, stuck in the low skilled, low wage workforce.

- Yeah, we know how important that first kind of, uh, earnings level is in someone's life too, so raising a lot of questions here. Doug Shapiro, National Student Clearinghouse Research Center Executive Director, alongside Yahoo Finance's Aarthi Swaminathan, appreciate the time.