Potential revenue losses for institutions of higher education by fiscal year 2021 could come to a total of $183 billion, according to a new study that analyzed revenue shortfalls.
Paul Friga, a public higher education consultant for the Association of Governing Boards of Universities and Colleges and vice president of strategy for HelioCampus, conducted the study with data from 107 institutions. The losses he found stemmed from decreased enrollment, tuition discounting, declining international student enrollments, the suspension of athletic programs, and direct COVID-19-related expenses.
Of the accrued losses, Friga estimates that in 2021 the most significant budgetary impact will come from revenue losses totalling $85 billion. Those projected reductions would be compounded by state budget cuts that could reach $74 billion, and institutional expenses related to COVID-19 could total an estimated $24 billion.
While institutions have sought to mitigate these pandemic-induced budgetary challenges by implementing hiring freezes, layoffs, operating budget cuts, and delayed capital projects, shortfalls still remain.
Institutions could best position themselves to avoid long-term funding crises by readjusting curricula, delivery models, and services — along with additional federal relief — Friga said.