This article was produced by The Hechinger Report, a nonprofit, independent news organization focused on inequality and innovation in education.
DUDLEY, Mass. — It was in his part-time job as a campus tour guide that Jared Maymon first heard prospective students and their parents asking not just about the food, the dorms or the required courses but about whether his college would be around long enough for them to experience any of those things.
Several other New England institutions had abruptly closed because of falling enrollments, growing debt and other problems. And Nichols College, where Maymon is a junior double-majoring in economics and finance, fit the same profile: small and with a comparatively low endowment and a student body drawn mostly from a few surrounding states.
“It was, like, 18 months ago, and I think [Mount Ida College, near Boston] closed — somewhere around there,” said Maymon, taking a break between classes in the Nichols student center. “And that’s when it kind of popped into my head and I was, like, ‘Oh, man, is this something that could happen to us?’ ”
He’s increasingly confident it won’t. In another of his roles here, as a vice president in student government, Maymon gets regular updates about the many solutions with which Nichols is experimenting as one of a few small private colleges publicly confronting a crisis that has shuttered one comparable institution after another.
It’s trying to increase enrollment, which has rebounded after a decline, according to publicly available and internal documents administrators made available. These also show that Nichols has reduced the number of dropouts, holding onto $5.4 million a year in tuition revenue it was previously losing. It’s saved more than $345,000 annually by streamlining some administrative tasks.
It’s expanding graduate programs and providing custom education for area businesses, increasing income from those sources by 46 percent. It’s reviewing staff positions to find any that aren’t needed, which may be eliminated as soon as this summer. It’s nearly doubled that endowment. And it’s begun a cost analysis of its smallest academic departments, with as few as 11 candidates for degrees apiece but as many as three full-time professors.
“It’s not panic time,” said Susan Engelkemeyer, a longtime business management professor and president of Nichols, which has about 1,200 full-time undergraduate and 235 graduate students. “We’re just trying to address the challenges we face.”
Surprisingly few such colleges are being so aggressive. When a fellow president told a higher education conference in January that her campus had already cut spending as much as it could — “to the bone … there’s nothing left to cut” — Engelkemeyer stood up and said she disagreed.
“I would suggest that there are very few schools that have done all that they can do,” she said in her office on the Nichols campus on a hill in rural Massachusetts near the border with Connecticut.
Colleges are closing or merging at an accelerating rate, according to the Moody’s bond-rating agency, from about eight per year between 2004 and 2014 to an estimated 20 per year moving forward, with small private colleges particularly vulnerable.
Yet “I talk to some of my colleagues that have structural deficits in the millions and they just say, ‘Well, we’ll be fine,’” Engelkemeyer said. “Well, if you project that out, you won’t be fine.”
Mount Ida, for example, whose most recent tax filings show it had annual revenues of $60 million, ran up more than $68 million of debt but continued to recruit applicants and agreed to a new contract with faculty just weeks before it closed, leaving 1,500 students in limbo and 280 full- and part-time employees without jobs.
Some 800 institutions face similar “critical strategic challenges” because they’re operated inefficiently or are very small, according to the consulting firm Parthenon-EY Education.
Despite their seemingly fast-increasing tuitions, colleges are giving discounts so steep that they are spending more than they take in, Moody’s reports. Many are desperate to fill seats; higher education institutions of all kinds had nearly 2.1 million fewer students this academic year than they did at the last enrollment peak, in 2011, thanks to an improving economy that is sucking more people straight into the workforce, and a decline in the number of 18- to 22-year olds that is steepest in the Northeast and Midwest.
This has most recently dragged down not only Mount Ida, but Wheelock College, in Boston, which merged with Boston University, and Newbury College, near Boston, which will close at the end of this semester. Hampshire College in Massachusetts won’t admit a full freshman class in the fall, and is looking for a merger partner; its president quit suddenly.
Three Vermont institutions also announced this year that they will close: Green Mountain and Southern Vermont colleges and the College of St. Joseph. So will Hiwassee College in Tennessee. And Wheeling Jesuit University in West Virginia has laid off more than a third of its full-time faculty.
Nichols and some other small private colleges are working to preempt that fate.
Nearly 20 have reduced their tuitions over the last three years, according to the National Association of Independent Colleges and Universities. That’s after a decade in which college tuition and fees rose 63 percent, or three times the rate of everything else tracked by the U.S. Bureau of Labor Statistics’ Consumer Price Index. Almost seven in 10 parents said in a survey that they had eliminated colleges from consideration for their children because of the cost.
Cutting the price is one way to compete for a dwindling supply of students. Other small four-year institutions are also negotiating deals with community colleges to smooth a path for transfers that many previously filled with obstacles.
Small colleges are also looking for new sources of revenue. If they have graduate divisions, they’re expanding them. To reduce costs, a few are cutting money-losing programs.
Liberal arts colleges, which have the extra burden of persuading students that they can get jobs when they graduate, are doubling down on professional development and adding high-demand programs; Hiram College in Ohio, for example, which by 2014 was deeply in debt, dropped majors including art history, music, philosophy and religion and added sport management and international studies in an approach it calls “the new liberal arts.”
Dominican University in California has teamed up with a coding academy called the Make School to offer a minor in computer science; Make School students, in exchange, can get Dominican bachelor’s degrees in applied computer science.
“Those colleges and universities that survive are likely to be not the ones with the biggest endowments but the ones that are the most creative and … the most entrepreneurial,” said Brian Mitchell, the former president of Bucknell University and the author of “How to Run a College,” who is now a consultant to many struggling institutions.
Nichols has been doing some of all of these things, showing that there are still ways to improve efficiency in higher education, but also how — even on a campus where the process has been notably transparent — there can be opposition and anxiety.
It has hired students instead of an outside vendor to staff its call center, saving $150,000 a year; combined financial aid into student financial services to save $50,000; moved digital marketing in house to save another $100,000; negotiated cheaper health insurance premiums; and increased the number of freshmen who return for sophomore year from a low of 62 percent in 2012 to 74 percent today. (The national average for private, nonprofit colleges is 82 percent.)
The college, which focuses on business, has survived hardship before. Founded in 1815, it closed altogether between 1909 and 1931 before reopening as a junior college for men, became a four-year school in 1958, decided to go co-ed in 1970 and started to add graduate programs in 1974. It ran up operating losses and went into debt in the late 1990s, a time when its enrollment dropped by 26 percent.
Applications fell again in 2017, but have since recovered, and the college exceeded its enrollment goals this year. Financial documents show it now has a positive cash flow, with revenues exceeding expenses by nearly $5 million, though Engelkemeyer said more work is needed for Nichols to stay healthy.
She has opened the books to faculty and students, holding meetings with them complete with PowerPoint presentations in which she’s spoken frankly about the problems. “You have no doubt read or heard about the challenges facing private colleges,” she wrote in a blunt memo to the campus. “Nichols College is not immune to these issues.”
Some of that transparency has prompted pushback. Engelkemeyer conceded that it still takes time to change an academic culture that has enjoyed an almost uninterrupted supply of students since she started teaching in 1990.
“There were more students than there were seats,” Engelkemeyer said. “You could raise tuition 10 percent and nobody batted an eye.”
Faculty may have been slow to recognize that those days are over, but most do now, said Erika Smith, who teaches international business and political science — especially after Nichols hired one of the professors laid off from Mount Ida. “That becomes a very sort of personal experience as a colleague,” Smith said. “The more those things happen, the more the reality sort of sets in.”
