The following factors should be considered in the context of changes in economy, industry, work force, income inequalities and gaps, and philanthropic activity.
Diminished state appropriations will affect the base higher-ed budget.
Invest in SUNY, Rational Tuition summary
A History of Rational Tuition, SUNY Student Association, 2014
"Let me be absolutely clear: A reenactment of NYSUNY 2020 is not an automatic renewal of annual tuition hikes. It is a renewal of SUNY’s ability to set tuition based on the immediate needs of SUNY’s state-operated campuses and the students, faculty, and staff they serve," former SUNY Chancellor Zimpher's op-ed concerning Rational Tuition renewal, 1/29/16
Increasing costs will affect institutional operations.
"The 2017 outlook for the US higher education sector continues to be stable, reflecting the expectation of sustained aggregate revenue growth at or above 3% for not-for-profit four-year public and private colleges and universities...." and "Softening revenues and increasing labor costs are other pressures which could emerge as endowment payouts are likely to shrink and wages tick higher as the labor market strengthens." US not-for-profit higher education's diverse revenue sources and sound demand drive steady aggregate revenue growth, Moody's Investor Service, 12/6/16
The Excelsior Scholarship Program could make college education more affordable, and more attractive to prospective students who qualify. The program's annual progress and residency requirements may make the program less attractive to students who take time away from their studies to work, or who wish to live in another state after graduating.
"The Excelsior Scholarship, in combination with other student financial aid programs, allows students to attend a SUNY or CUNY college tuition-free," provided students meet eligibility requirements. Higher Education Services Corporation
"At the state’s community colleges, more than 90 percent of students would not qualify for free tuition based on those requirements. Even at its four-year colleges, 60 percent would be ineligible." New York’s Free-Tuition Program Will Help Traditional, but Not Typical, Students, The New York Times, 4/11/17
"Students must first apply for, and use, other money like federal Pell Grants, before turning to the scholarship. That, in turn, means that low-income students have less to gain from the scholarship than do students from families who are too wealthy to qualify for those grants." Here's the Fine Print on the Country's Biggest-Ever Free College Plan, National Public Radio, 4/11/17
"Perhaps the most controversial element of the program, which is called the Excelsior Scholarship, is a work and residency obligation that kicks in after students graduate. Scholarship recipients will have to live and work in New York State after graduation for the same number of years they received Excelsior Scholarships, or their grants will turn into loans." N.Y.'s Tuition-Free Dream Meets Details, Inside Higher Ed, 4/17/17
New union contracts (and anticipated raises under current contracts) not funded by the state or by Maintenance of Effort could prove disruptive to budgets.
Rising enrollment will increase the need to invest in faculty and support staff, and facilities.
Demographic shifts related to funding
The changing demographic of incoming students may change funding needs and institutional appropriations.
Diversity and inclusion in the workforce
The diversification of the higher-education workforce—especially in the leadership ranks—is critical to match the shifting changes in the student population. The workforce is getting more diverse.
"The data suggest colleges and universities are prioritizing experience when they have to hire a president, according to ACE. But because presidents have historically been white men, the emphasis on experience comes at a cost to hopes of increasing diversity." The Slowly Diversifying Presidency, Inside Higher Ed, 6/20/2017
"According to William Frey, demographer at the Brookings Institution, racial minorities will account for all of the growth in the labor force within the next few decades. However, the growing diversity isn't reflected in faculty hiring trends." The workforce is getting more diverse. So should college faculty. Education Advisory Board, 8/5/16
Sustainability of the higher-education business model
The resource planning efforts will be hitting critical areas within the next two to three years for both public and private institutions. The impact on the workforce is that there will be a wave of life transitions (retirements), an increase in fringe rate costs (health care, retirement contributions, competitive salaries with private sector, etc.), shrinking budgets; also, seeking to manage the curve of tuition increase to fund growth will provide additional challenges in planning and implementation. The Highly Endangered Higher Education Business Model (and How to Fix It), American Council on Education, 6/12/15
"Colleges and universities face daunting challenges to long-established business models. The cost of providing higher education continues to rise but sources of funding have eroded." The Higher Education Business Model Innovation and Financial Sustainability, TIAA-CREF Institute, 2/17/17
Public colleges and universities in the U.S. provide the most affordable path to a quality higher education. But increasing income disparity and stagnating middle-class wages are making college less affordable.
"The evidence that a college degree significantly improves one’s employment prospects and earnings potential is overwhelming. Bachelor’s degree holders are half as likely to be unemployed as their peers who only have a high school degree, and they make $1 million in additional earnings on average over their lifetime." How does a college degree improve graduates’ employment and earnings potential?, Association of Public and Land-Grant Universities, 2016
"In the past decade, there has been a dramatic increase in the number of American student-loan borrowers leaving college with high debt and low earnings. The resulting unsustainable debt burdens impose substantial costs on students and on federal taxpayers. Much of the growth in the levels of student loans has been linked to the rise of for-profit colleges and other institutions with weak educational outcomes." The student loan crisis: A look at the data, Brookings Institute, 8/16/17
An increase in competition from private institutions, which tend to offer significant tuition “discounts,” is anticipated going forward.
A decrease in international student applications and enrollment will have a significant impact on revenue.
In New York State, international students account for 9 percent of the total student population. International Students as a Proportion of All Higher Education with States, Open Doors, 2016
"Between 2007–2008 to 2015–2016, the number of international students in the United States increased by 67 percent to reach 1,043,839. At the same time, the economic benefits from the presence of international students on American campuses increased by 111 percent to reach US$32.8 billion. This clearly indicates that the financial contributions of international students have outpaced the increase in enrollment." Are International Students Cash Cows?, Rahul Choudaha, International Higher Education, 2017
"The growing and diverse international student population on U.S. campuses...enriches the learning experience for everyone—with American business and industry the ultimate beneficiaries." The Growing Risk Factor Facing Our Greatest Export, Higher Education Today, 1/23/17
A decrease in graduate students—and, in some cases, professional students—will have revenue implications.
"Research conducted by the Council of Graduate Schools (CGS) in conjunction with TIAA, a leading financial services provider, found that 60 percent of master’s students and 55 percent of doctoral students report feeling stressed about their finances." Majority of Graduate Students Stress About Finances, Seek Information on Long-term Financial Security, Council of Graduate Schools, 11/15/16
"Amid the uncertainty over U.S. immigration policy, one fact is sending a chill through U.S. higher education: Some U.S. graduate programs in engineering, Science has learned, are seeing a sharp drop this year in the number of applications from international students." Drop in foreign applicants worries U.S. engineering schools, Science, 2/14/17
Diminished disposable income may temper philanthropic activity (or change the nature of it). Decreasing alumni giving has continued a national trend even as the number of alumni increases overall. Younger alumni and Millennials (those in their 20s and early 30s), are less predisposed to giving, and as a group ask for greater accountability with regard to an institution's social responsibility. The rapid increase in college tuition, and the significant debt some graduates carry, also lessens their giving potential.
"Class Exodus," Annual Giving Network, 2015
"How Millennials Have Disrupted Traditional Charitable Giving," The Balance, 2017
Changes to the Buffalo Niagara economy, and contributing factors like the cost of real estate and property management, will affect budgets.
Like all academic libraries, University Libraries face various issues of crucial importance: