Troubled future and present of Universities

Moody’s recently predicted that growth in operating expenses will outpace revenues at most institutions of higher education. To be financially stable, most colleges need revenue growth of at least 3 percent, Moody’s advised. Just 44 percent of chief financial officers of higher education institutions say they are confident their college will be financially stable over the next 10 years, down from 54 percent in 2016, according to a survey last year by Inside Higher Ed. Among the many reasons: more than two-thirds believe that their tuition discount rate is unsustainable

Rapidly rising tuition, shifting demographics, the growing popularity of online learning, pressure on research funding, volatile endowment earnings, and parental and graduate dissatisfaction with employment opportunities: all are trends that pose significant risks for university departments, colleges, and central administrations.

Universities, are facing declining enrollment, nervously watching expenses outpace revenue, and tapping their endowments to cover shortfalls. These pressures have forced many schools to make painful choices, including cutting programs, laying off faculty, merging with other schools, and reducing student admissions. In the worst cases, some schools have lost accreditation or have shut down.


Attack 1 : Internet, which made knowledge previously attainable only on college campuses available to all. Today, Khan Academy, YouTube Edu, Academic Earth, and other outlets make educational videos available for free; many of these videos cover topics that would be standard in many college curricula, particularly in mathematics, engineering, and science . The Internet also makes it possible for people from all over the world to find practice exams, problem sets, visual examples and walk-throughs, worksheets, lecture notes, academic presentations, interactive exercises, webinars, and more for free. s. The Internet has created a community of learners.

Attack #2: Distance learning , the impact they have made on education is clear: today, around 20% of all university students take at least one university course online, with 9% taking all of their courses online .

Attack #3: The third wave of attack comes from the still fast growing group of large for-profit (or “career”) universities, which have the same accreditation as traditional universities but have the intention and potential to scale up to much larger size. Today, about 1,200 for-profit colleges operate in the United States, and they comprise 26% of all colleges and universities , For-profit universities have followed a fundamentally different business model than mainstream universities. If modern universities are high-touch operations,the for-profits are low-touch operations, without residential campuses but with accessible instructors and teaching assistants. This alternative model, with its lower salaries for teaching staff and the absence of scholarly research operations, is considerably less expensive compared to traditional universities.

Attack #4: Fourth, more recently, a wave of education startups like Coursera, Udacity, and Udemy, and a Harvard and MIT spin-off called EdX have formed to provide smaller numbers of courses to massive online audiences. The companies create what have come to be known as MOOCs (massive open online courses), some of which have enrolled as many as 160,000 students (most recently in Stanford’s “Artificial Intelligence” class). Whereas traditional universities are high touch and large for-profits are low touch, MOOCs operate in “no touch” mode, where every interaction with students is automated, often with peer interaction, chat rooms, peer review, and automated (or peer) grading.

Most universities struggle to take corrective steps. That’s partly due to institutional rigidity and partly to the fact that not all strategic options available to a business are accessible to a higher-education conglomerate. Barriers to restructuring include regulation (the closing and launching of programs requires governmental approval in some states) and the stickiness of faculty contracts. Also, there are the many and varied interests, expectations, and demands of past and present donors, students, and alumni to consider.


Traditional way of imparting education will have to go through a major change, Universities can build on tremendous advantage in research to improve teaching and learning, universities should flex their traditional dominance over the creation and preservation of knowledge— even if their role as sole distributors of knowledge is under attack. We should change the university from a place where knowledge learned outside the classroom is reported to students to one where students themselves directly experience having a hand in creating knowledge.

It is a travesty for a student to spend four years at a world-class university and only read about major discoveries in the campus newspaper. Just having a seat at the table when a major discovery is made can also be life-changing.

Many university faculty are terrific teachers, but those who survive excel at research, are motivated by research, and earned their position in the university because of their research; we should give students that same experience. All research groups on campus should strive to have some type of participation by students or apprenticeship component.

This experience students cannot get at any of the for profit competitors, and although university faculty often love to teach, what gets them up in the morning and keeps them fascinated with their subject matter is the thrill of discovery and invention. Is there a more meaningful gift or experience a university can give to a students?


McKinsey ,Universities and the conglomerate challenge,September 2018 |

McKinsey ,Transformation 101: How universities can overcome financial headwinds to focus on their mission,May 2019 | ArticleCommentary.

The Troubled Future of Colleges and Universities Gary King, Harvard University Maya Sen, University of Rochester


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