Time May Be Compounding Challenges Facing Higher Education

By David Laird

For more than two decades analysts have warned that changing demographics in higher education would induce major changes in institutions and their roles in our culture and economy. We now see the first wave of those changes in the projections of high school graduates through the next decade.

Higher education leaders who are hesitant to take unprecedented moves in the current marketplace may be limiting future choices while compounding the effects of major challenges. Below are some of the collective challenges which leaders and their boards should not overlook when establishing or adapting their strategic plans for the next decade or two.

High School Graduate Projections


Twenty-five states are projected to experience declines in high school graduation rates of 5 to more than 15 percent due principally to declining birth rates in the white population – rates that have remained below replacement rates for about twenty years. Only eight states are projected to show growth over the next decade. The states projected to decline also are states where retirement of baby boomers will leave significant gaps in the ranks of professionals.

Looking over the horizon, America’s changing population rates by race and ethnicity will alter the nation in many direct and subtle ways. As the principal source of well-educated leaders, professionals and high tech workers, higher education will be directly in the path of waves of change.

America's Changing Population

The increasing demand for more well-educated college graduates will focus on high school preparation and the financial ability of families to bear a realistic portion of the costs of higher education. There are a number of promising programs designed to help students (especially low income and minorities) prepare for success in college, but none have been tested on a statewide or national scale. As these adjustments were gaining traction, the recession beginning in 2007 blew a big hole in family net worth and state budgets. The recovery has been slow and variable, which leaves our economy and lots of institutions in a fragile condition if another recession occurs as predicted by many.

Family Net Worth

As U.S. higher education has struggled through the developing challenges and changes. A quick look at one of the comparative measures used to evaluate national efforts and relative success, suggests that the U.S. has held steady while a number of our international competitors have been gaining ground.

US Degree Production

The quick summary is that the U.S. higher education enterprise is facing a handful of intersecting challenges in demographics, preparation for college, general economics, family finances, government support, and growing international competition.  Unlike some challenges of the past, which responded well to single dimension adjustment, institutions need to address most of the present amalgam of challenges with comprehensive strategies that will require constant adjustment. Presidents and Board members should select and train their leadership team to constantly evaluate changing risks, substantially increased competition, modest financial margins from which to fashion change in their financing model, and a rapidly changing precollege population.

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