The pressure mounts on U.S. universities

As students return to campus this month, U.S. universities are facing unprecedented financial pressure to change their ways.

New student enrollment is on pace to decline 15% due to a drop in births that began during the Great Recession and hasn’t let up. International student enrollment is also down sharply due to a 36% decline in visas. And public support for universities, nearly all of which rely on taxpayer-funded loans and grants that cover tuition, is at its lowest point in decades: Seventy percent say higher ed is headed in the wrong direction.

Earlier this month, Education Secretary Linda McMahon tightened the screws on universities by issuing a letter—drafted with the input of the Association of American Universities (AAU) and some college presidents—that calls on universities to post public commitments to reform.

The letter asks for responses to a series of questions that call for transparent admissions, free exchange of ideas, intellectual pluralism, academic rigor, academic research free from foreign influence, and affordable, high-return degrees.

“This forthright conversation with the American people is long overdue,” McMahon wrote. “And it is the essential first step toward rebuilding trust in the sector.”

Many Christians have felt that academic standards and viewpoint diversity have greatly diminished on secular campuses. Many have opted to attend or support Christian colleges, which have in large part resisted the most troubling trends in higher education.

But now Christian colleges face the same challenges as all other universities coming from changing demographics. There are simply fewer 18-year-olds graduating from high school for the next 18 years than there were before, shrinking the pool of candidates for college.

The drop in international students is even more painful for some universities, as they often pay full tuition. 

In the past, universities have raised prices to keep their finances humming. But they may have reached the end of their ability to do that. Americans overwhelmingly told Pew Research last year that colleges are not affordable—79% said the higher education system is doing a fair or poor job keeping tuition affordable versus just 12% who say it is doing a good or very good job.

And unlike on most other higher education issues, there is no difference based on political party.

The numbers back them up. A 2019 study by researchers at the Federal Reserve Bank of St. Louis found that while earning a bachelor’s degree still yields higher incomes, the amount of extra wealth it produces has been shrinking and is now essentially zero for most demographic groups. That’s in large part due to the additional debt students take on to pay for college.

From 1990 to 2020, average costs for students doubled, after adjusting for inflation, according to a report by the American Enterprise Institute. It found that external funding such as federal Pell grants had risen dramatically during that time—so much that if costs had simply risen as fast as inflation since 1990, every student at 4-year public colleges would now be able to attend tuition-free. But instead, universities largely kept those funds for themselves—while also increasing costs to students.

In the case of many institutions, Americans don’t feel they’re getting a good deal in return for the higher costs. Pew asked a series of questions about the educational quality of universities such as exposing students to a wide range of opinions, providing opportunities for students to express their own opinions, developing critical thinking and problem solving, and preparing students for well-paying jobs. On every single one, more Americans said universities were doing a “fair or poor job” than said they were doing a “good or very good job.” The only exception was on advancing research and innovation.

This broad sense of being ripped off suggests that, even after the Trump administration, there will still be strong public support for reform.

Responses to McMahon’s letter are due by December. How many universities respond and how substantively they respond, will be a good indicator of whether they intend to change—or whether they will bet the political winds will shift and they can avoid real reform.