Enrollment Decreases at OU Started Before the Pandemic
by Andie Hunt, Illustrations by Macey Elder
The trees are nearly bare and so is campus. Everything from classes to Halloween celebrations are unrecognizable. Ohio University does not look the same as it once did. But even with the pandemic aside, the identity and mission of OU has been in transition over the past decade.
The reputation of OU has been in decline and subsequently, so has enrollment. Since 2016, enrollment has dropped consistently, only made worse by the onslaught of the coronavirus. Many first-year students that would have begun their much-anticipated college careers this fall have deferred their college acceptance or given up their spot at the university altogether.
Students, faculty and administration alike have theories as to why enrollment has diminished over the last four years, but they all have different perspectives.
Some students guess OU’s reputation of being a party school is at fault. Faculty members blame the increased investments in non-academic programs to be the cause of OU’s weakened academic reputation, while administration sees it as a lack of “strategic storytelling.”
“There is a budget crisis, everyone agrees with that,” says Richard Vedder, a professor emeritus of economics who has been with the university since 1965 and has taught parttime since his retirement in 2001. “Turning [OU] around reputationally is key to turning it around financially.”
According to U.S. News and World Report, OU ranked 98th in the country in 2005, out of 220 universities. Fast forward 15 years, OU now ranks 176th. As enrollment has declined, competing schools have seen their enrollment increase.
In the higher education market, reputation is everything. When there is doubt over the quality, retention or value of any institution, peoples’ perceptions are the most powerful competition.
In 1804, OU established its credibility as the first school in both the west and Ohio. Now, it is one of over 100 public and private universities in the state. Ohio residents make up over 80% of enrollment, increasing the competition within Ohio.
“If you can’t get into [Ohio State University], you go to OU,” says Vedder, who administered Forbes’ Best Colleges rankings. “In 2003 it was exactly the other way around…OU and OSU are competitors for the same students.”
This distinction in university reputation also disadvantages alumni and recent graduates as they move through their careers. According to the U.S. Department of Education College Scorecard, the starting salary of a communications major from OSU is $37,800 while the starting salary of an OU graduate with the same major is $31,000.
Part of the new 2020 Strategic Framework introduced by President M. Duane Nellis includes increasing “Alumni and Corporate Engagement and Coordination.” This plan cannot work when the recent alumni earn less and are unable to donate to the university that gave them a quality education, but inferior reputation.
Upon realizing the decrease in enrollment in 2016, investments had already been placed into overdue renovations and building projects, including $40 million for Jefferson Marketplace and $1.4 million for the stabilization of Ping Recreation Center since the first floor was sinking into the ground because of weak soils.
During this time, former President Roderick McDavis took out a century bond worth $250 million. A century bond is a “long-dated debt” that a company can begin paying off after 30 years. This means the university could borrow money at a cheaper rate as the interest rates would be reduced by the opportunity costs from revenue earned, according to J.P. Morgan.
With so much money going out, and unanticipated decline in annual revenue, the university found itself in a corner. The strategy shifted to a focus on expanding enrollment. In 2016, university-wide fall enrollment was 36,867 compared to 2019 fall enrollment, which dropped to 33,044.
At the end of the McDavis Administration, in an attempt to expand enrollment, OU sought to diversify the applicant pool. This approach included adapting application requirement to become less exclusive, targeting first-generation students, and continuing the fixed-tuition and fee program, the Ohio Guarantee.
Despite the arrival of President Nellis in the summer of 2017, the pending fall semester enrollment shortcomings could not be reversed. On average, the U.S. News and World Report ranking of OU drops at a rate of five spots per year.
“I think [President Nellis] inherited most of the problems,” Vedder says.
In an attempt to put OU back on the map, the university increased advertisements and promotion, created several new honors programs, such as within the College of Health Sciences and Professions, and hired more university administration. According to the 2020 OU Factbook, in the fall of 2019, Athens campus administration exceeded full-time faculty at 1,535 to 1,088. From the university’s perspective, new honors programs would return the focus to academics, and more administration would mean new professional viewpoints to conceive a plan for rebuilding OU’s identity.
Four years later and $30 million short, OU was hit with the financial turmoil of the coronavirus pandemic. At this point in time, the 54.5% of annual revenue that traditionally comes from tuition, room and board is in jeopardy. Less than half of the first- and second-year students will have utilized dorms in the fall 2020 semester.
The State Share of Instruction awarded to each public higher education institution within Ohio to subsidize the cost of tuition for residents has made its own budget cuts due to the pandemic. The state aid for Fiscal Year 2021 (FY21) has been reduced by 4.38%, which means a loss of $8-9 million for OU, according to a report by President Nellis, Executive Vice President and Provost Elizabeth Sayrs and Senior Vice President for Finance and Administration Deb Shaffer.
“Given the economic pressures on students and families, we are proud to be the only public university in the state to have made a commitment to support student affordability by not increasing tuition in FY21, which will also impact revenues,” the report stated.
Operating at a deficit, OU needs to bring in new revenue while upholding the Ohio Guarantee for current students and providing 89% of students with some form of financial aid. The new Strategic Framework designed by the Nellis administration has adapted to these “unprecedented times.”
This framework is comprised of new enrollment targets, such as adult learners who are past “college-age,” graduate students and other non-traditional students. It also includes integrating academic and administrative functions to create a more cohesive and consolidated university. Another initiative is the remodel of the operating budget, which will shift from traditional Responsibility Centered Management (RCM), which focuses on obtaining new sources of revenue, to a more transparent hybrid model of resource allocation with the intention to create a sustainable financial future.
This new hybrid model would mean administrative and academic benchmarking to better fit the size of the institution, as well as restructuring all-campus unit functions. With strengthened investments in academic quality and offerings, the university can rebuild the reputation and better fit its scale of spending to its income.
It is projected that over the next 10 years, the population of 18-year-olds, the target market for most undergraduate programs, will shrink, meaning these institutions will see a continued decrease in enrollment. The acceleration of degree completion has caused lower enrollment as well, due to college preparation programs available in high school, which allows students to graduate within three to four years, rather than four to five.
Higher education as a whole is going through a transition through the pandemic and over the next decade, and the students have all the power. Students are what make universities successful and keep them in business. OU students work hard for their degrees and ultimately create the identity of the school.
In OU’s pursuit to redefine its identity and mission, much is at stake, the city of Athens and its small businesses depend on the 20,000 people the university brings in each year, as well as the countless jobs it provides.
“I don’t think it means we don’t know who we are,” says Robin Oliver, the vice president for university communications and marketing. “We just need to be louder and prouder.