Q: Will the economic impact of the forthcoming COVID-19 recession mirror that of 2008-2009? If not, how will it impact higher education differently? What should I be doing to prepare for the fall?

 

History tells us that higher education enrollment grows during a recession, particularly for adult learners and graduate students. Higher education is seen as a refuge from economic hardship and a chance to re-tool. Schools welcome increased demand because other sources of funds–state budgets, endowments, and philanthropy–tend to weaken during downturns.

A few things are different this time. First, the economic strain will likely be much worse than 2008. Second, so long as COVID-19 remains a threat, online learning is the default option. Third, in relative terms, higher education is more expensive than it was a decade ago. Fourth, there are many more informal and non-traditional learning options available, such as MOOCs.

If federal stimulus matches the scale of the downturn–whether propping up schools, employers, consumers, or some combination of these–the normal counter-cyclical pattern should play out. But if the stimulus falls short, many consumers may turn to more affordable education options that fall outside conventional colleges and price points. If the federal government opts to expand Title IV to non-traditional providers offering short programs to help consumers get back on their feet, that will depress demand for degree programs. 

In terms of delivery mode, adult learners and graduate students/prospects should be relatively content with online learning as the default. These populations have already embraced this modality in large numbers. For traditional-aged undergraduates, and any program with a value proposition defined by in-person study, the prospect of remote instruction for fall 2020 risks lots of students deferring or suspending enrollment and opting for low-priced credits at schools experienced with online. Why pay top dollar at a school that is relatively clueless about online learning? Better to earn transferable credits and re-enroll at the original school when things are back to normal. Insofar as the pandemic severely curtails work and travel alternatives to college, it seems unlikely that traditional-aged students will forego college altogether this fall. 

Schools that want to shore up their traditional-aged, undergraduate fall 2020 class need to use the time between now and then to come up with forms of online learning that are a good fit for this population. There is no point in simply replicating online learning built for adult learners. 

For 18-19-year-olds, “college” means a lot more than convenient instruction. Schools have to figure out what socialization and extracurriculars look like online. If a school wants to charge normal tuition for remote instruction in fall 2020, it will have to get creative. Schools need to incent these students to want to be part of the fall 2020 semester whatever the modality. Otherwise, many students will defer or turn to cheaper online options where the experience matches the price. 

Richard Garrett

Eduventures Chief Research Officer at Encoura
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