Brent Jones

FINANCIAL RISKS FROM UPCOMING STUDENT DEMOGRAPHIC CLIFF: ⚠️ Student Demand + Reliance on Tuition As schools prep for the upcoming demographic cliff, who is at risk of having to make major changes or budget cuts? DEMAND: Schools with high admissions demand should be fine, because they'll be able to continue filling enrollment quotas. RESOURCES: Schools with a diverse financial base will be fine, because they don't rely on tuition as heavily. ...but schools who have low demand (and may have more trouble filling quotas) and those who depend heavily on tuition (which depends on enrollment numbers) may have a major struggle. They will either have to weather the storm through pushing donations, diversifying their financial base, or making heavy budget cuts. This is an over-simplified look, but gives you some interesting perspective. ATHLETIC IMPACT: For Athletic Depts, this is where heavy subsidies and lavish spending on non-revenue sports may be at risk. At the same time, some non-revenue sports that are (not so) secretly enrollment drivers (where they use recruited walk-ons to boost overall enrollment numbers, which more than pays for some low-cost sports) may become even more important as a way to recruit the fewer overall students attending who will be enrolling in colleges. FYI - WHAT IS THE DEMOGRAPHIC CLIFF: For those who don't know - the enrollment cliff is the upcoming period of ~2026-32 where babies who weren't born during the '08 recession therefore won't be attending college, decreasing overall enrollment.

2020 - Let’s go!