Working in higher education over the last decade, you would hardly have known we were in the longest bull market in U.S. history. Funding per student to state institutions never recovered after the cuts imposed during the Great Recession, and a cyclic decline in the number of “college-age” students drove lower aggregate enrollment. Larger, top-tier institutions remained stable, but even there tenure-track jobs were scarcer than they had been in previous periods. Salaries barely kept pace with inflation. Morale was low.
Institutional closures made the news well before COVID-19 emerged as a global pandemic. But given the state of the broader economy, the assets these colleges held -- and the students they served -- could be absorbed by their larger and better endowed neighbors. We have already seen reports of colleges shuttering forever in response to mandatory campus shutdowns. Given the unclear duration of the current threat and the resultant imperative that institutions preserve cash, there will be fewer institutions today that can pick up the slack. Read more.