You have /5 articles left.
Sign up for a free account or log in.

A hand can be seen adjusting a black and white sign that reads “CLOSED.”

StockSeller_ukr/iStock/Getty Images Plus

“Colleges don’t close,” her grandfather reassured my daughter when she expressed concerns about the future of the small, private, Roman Catholic, liberal arts college that I had just joined. Her reading and experience in finance left her less than consoled by those words, but she changed the subject for his sake.

Economic inequities separating U.S. higher education institutions span several orders of magnitude and mirror inequality in all other aspects of life in America. Colleges with enrollments of several thousand students or more, endowments above $150 million, and with selectivity rates that have increased despite unfavorable trends in traditional-aged student demographics and attitudes—these colleges are secure. These selective, well-endowed colleges with strong enrollment will be here in five, ten, and possibly one hundred years—these colleges won’t close soon. For smaller, less endowed, and less selective institutions, which often serve the most vulnerable student populations, the threat of closure is very real. For many, that fate will be inevitable in the next five years unless a merger or other transformative change starts now.

Despite good reporting on the existential crisis facing small private colleges, especially religiously affiliated ones, the public remains convinced that, en masse, “colleges don’t close.” Sure, a few colleges might shut their doors, but the cause was likely preventable—financial mismanagement, poor marketing, unpopular programs or combinations of all of the above led to the demise. Better leadership, more outreach to donors and alumni, cutting back on expenses, offering more popular programs, and investing in athletics are solutions for an ailing college. Certainly, the college in my town or my alma mater will not fall victim to preventable errors and will find the recipe to survive and prosper.

False confidence is not limited to those outside of higher education. “It’s hard to kill a college,” a good friend and fellow faculty member shared as we discussed concerns about leadership decisions in pre-COVID times. As a social historian, he was convinced that the decisions of leadership, even horrible ones, could not bring an end to his college. He might be right. However, approaching demographic and financial realities can and will end many small colleges. Even the best leadership decisions cannot avoid five cold realities.

The first and unavoidable bitter fact, the “demographic cliff” (declining numbers of college-bound students because of a post-2008 drop in births), arrives in 2025. The cliff will significantly reduce the pool of traditional-aged students seeking postsecondary education—the lifeblood of small, residential colleges—likely for at least a generation.

Second, rising costs of operations, driven by inflation, along with the end of COVID-19 federal funds, combine to create budget deficits that cut into reserve funds and limit investment in programs and facilities necessary for adaptation.

Third, a change in attitudes about the necessity of a college degree, as well as a change in the willingness and ability of students to pay the full price for a degree, reduce both overall enrollment and the net revenue per student.

Fourthly, fewer students identify as members of traditional religious institutions that sponsor many small, private colleges.

Finally, many families question the value of the liberal arts—the central tenet of most of these colleges’ curriculums. So, private, religious, liberal arts colleges compete with secular, public institutions for a rising fraction of their enrollment. To do so, less selective colleges must significantly discount tuition to lure students so that out-of-pocket costs are on par with, or even lower than, those of public institutions. However, without the state subsidies public institutions receive, private colleges cannot generate the necessary revenue to balance rising costs without significant endowment, gift and grant income.

These five trends are not new; they have been developing over more than a decade. While the pandemic certainly disrupted the traditional operations and challenged institutions to quickly adapt, if anything, the federal dollars masked them or delayed their impact. So, why do people outside and even some inside higher education still believe that colleges can’t close?

Ironically, the same institutions whose missions often include “the courageous search for truth” are primarily to blame for the public ignorance of the vulnerabilities of small colleges. There are incredible disincentives for college leaders to speak openly about the existential crisis facing our institutions. What prospective student and his or her family would consider a college at risk of closing before they graduate? What donor will gift a building that might become a senior living facility or endow a professorship that might vanish? Would faculty or staff join a community at risk? How would my career be impacted as a leader of a failed college? No, you might argue, the only possible posture is one of glowing and unquestioned optimism—forward, always forward, everywhere forward. Otherwise, one’s fate is sealed.

What could motivate college leaders to discuss the upcoming crisis openly and honestly? Besides the high ideals of mission integrity and commitment to truth-finding and truth-telling, the pragmatic reason for this necessary discussion is to limit the pain if an institution must close and to welcome more voices earlier to face the challenges collectively. The costs of the lack of internal and external understanding of the existential threats facing small colleges are apparent for those of us unfortunate to be in the current wave of closures.

I am writing this while in the throes of an emotional closure of a 102-year-old Catholic college. The most common reaction to the announcement of closure was surprise, despite a history of financial struggle and frequent, honest updates to the faculty and staff. Even amongst the leadership, surprise and positivity characterized the response when bank covenants were missed, or special endowment draws were needed. Attempts to thwart the closure were delayed because of the need to project optimism. Confidence prevailed that, as it had in the past, the college would overcome present challenges.

The inability to openly acknowledge the crisis means transformative change is ineffective and divisiveness in the community grows when reality hits. For instance, merger and partnership discussions begin years too late—a complex merger can take years to accomplish. When merger talks start late, they end quickly with confirmation of the circumstances of crippling debt, systemic budget deficits, flat or declining enrollment forecasts, and deteriorating physical and technological infrastructure. Alumni and other donors claim that if they had only known the extent of the crisis, they would have given more to past campaigns. Faculty and staff feel blindsided.

Without an understanding of the crisis facing our small colleges, no amount of internal and external analysis reaching the same conclusion will be enough for many to accept their institution has no viable future. Donors, alumni, former and current board members, administrators, faculty and staff are left in disbelief. Some may band together to go as far as to attempt a potential takeover of the board and upper administration (or even, at my institution, attempt to negotiate directly with a major creditor). Pledges for unprecedented giving are solicited and some received, but amount to a fraction of the present need. Without evidence, allegations of financial impropriety or mismanagement are murmured or openly leveled.

Some may say these reactions are inevitable given the emotional attachment to a beloved institution. However, as educators we must help others understand—to teach and promote learning so others may avoid these outcomes or at least lessen the hardship. So, I call for a more open discussion of the realities facing small, private colleges. Students and families deserve to know the risks along with the great benefits of choosing our institutions. Faculty and staff also deserve to know, share in the governance, and accept the responsibly that this entails. The college should not be just an employer— it is a vocation for every employee sharing in the unique student-centered mission of the institution. The faculty and staff are often the first to be aware that financial circumstances are impacting the education of the students. They can have innovative ideas for change, but without acknowledging that those changes are necessary for the existence of the institution, the default will be to preserve the status quo.

Yes, colleges do close. We must muster the courage and strength to face this reality and talk openly about it. Only collectively can some colleges find a viable path forward. Only collectively can others close with dignity and grace. A student-centered institution that pledges to be a good steward of its resources cannot work to stay open at all costs and remain true to its mission. The risk of a disorderly closure and the havoc that this catastrophe causes for students, faculty and staff can happen and must be prevented—even if that means an unwanted but orderly closure.

Dialogue is essential within an institution, within sponsoring religious orders or denominations, regionally, and nationally. We might not be able to change an inevitable closure, but in the ending, we can minimize harm, pain and distress; celebrate a legacy; and ensure that the individuals who make up our institutions receive the care they deserve. Yes, colleges will close and merge—let’s do it right.

John J. Smetanka, Ph.D., is interim president, provost and dean of faculty at Notre Dame College, in Ohio, which will close at the end of the spring semester.

Next Story

More from Views