U.S. colleges and universities stand to lose a collective $183 billion as a result of the pandemic, according to an analysis by Paul Friga, a public higher education consultant for the Association of Governing Boards of Universities and Colleges and a clinical associate professor of strategy at the University of North Carolina Kenan-Flagler Business School.
Friga examined budget estimates for fiscal years 2020 and 2021 from 107 U.S. colleges and universities. Revenue losses for higher education institutions could reach $85 billion in fiscal 2021, driven by decreased enrollment, tuition discounting, declining international student enrollment and the suspension of athletic programs, according to Friga.
College budgets could be further strained by an estimated $74 billion cut to states’ higher education funding, as well as $24 billion in pandemic-related expenses.
Institutions are working to minimize budget shortfalls through hiring freezes, layoffs, operating budget cuts and delayed capital projects, Friga said in a press release. The release describes the pandemic as having the potential to cause the "most devastating loss for higher education ever."
Federal assistance from the Biden administration could soften the blow but still leave a potential shortfall estimated at $146 billion.
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