Vincent Calluzzo Dean, Hagan School of Business, Iona College James Murtha Chairman and CEO, Maguire Associates Mary Beth Carey Vice President for Enrollment.

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Vincent CalluzzoDean, Hagan School of Business, Iona College

James Murtha Chairman and CEO, Maguire Associates

Mary Beth CareyVice President for Enrollment Management, Iona College

Ganesh M. PanditAssociate Professor of Accounting and Special Assistant to the Dean

Robert B. Willumstad School of Business, Adelphi University

Presentation Participants

The Changing Meaning of May 1 in College

Admission and Enrollment

Presentation to Mid-Atlantic Association for Colleges of Business Administration (MAACBA)October 16, 2014

Jim Murtha, Ph.D.

Chairman & CEO Maguire Associates

Need for perspective

• May 1st and our focus on it may be something headed to the rear view mirror• Many public institutions always had substantial activity

after May 1• For-profit colleges offer a carousel of courses that starts

every 7 or 8 weeks• The meaning of “selectivity” is changing: students have

more choices and are weighing their options• May 1 is a reflection of a “new normal” in higher

education

Emergence of an Economic “New Normal”• Idea is credited to Mohamed El-Erian (Financial Times,

July 2009), recently departed CEO of PIMCO.• The new normal is a time when• global growth and investment returns will be far lower than in

the recent past. • higher than normal unemployment

• Federal Reserve predictions also include• slower than expected growth • lingering very low interest rates

Origins of a New Normal• Cheap debt fueled a spending binge • Leading to a housing price bubble• Too much debt for gov’t, individuals and some businesses• When housing prices fell to more normal levels, everyone

tried to bail• Families had to pay off debt even as home prices declined,

a lot• Families lost wealth leading to lower consumer spending• Reduced spending also

• lowered overall economic activity• made businesses skittish about hiring, even when things improved

A New Normal for Higher Education?

• Did the economic downturn change higher education?• In a fundamental way?• For the long term?• My answer to these questions is yes, yes and yes

National Postsecondary Enrollment by Sector

Total Enrollment Four-Year Public Four-year Private Four- Year, For-profit Two-Year Public

2010 20510526 7712447 3579325 1639196 7030516

2011 20556272 7819806 3697254 1577290 6918915

2012 20195924 7769609 3714967 1463097 6706913

2013 19885203 7796119 3761953 1321107 6497602

2,500,000

7,500,000

12,500,000

17,500,000

22,500,000

Total Headcount

2010 2011 2012 2013

A “New Normal” for Colleges and Universities?Five Dimensions:Greater price sensitivityFewer resourcesExpense pressure from revenue shortfallsGreater competitionStruggle to survive

Here to stay?These forces were at play prior to the fiscal crisisFinancial upheaval added to internal and external pressures Financial turmoil adds impetus to a financial transformation in higher education that was already underway.

Demand Factors

Demography

• College enrollment will grow more slowly, especially in the private sector• Greater participation of those over 25 years old• Current high school graduates will continue to decline or

remain flat in all States outside the South• White high school graduates will decline while Hispanics

and Asians will rise

Finances

• Most students attend public institutions with low tuition• Tuition charges have increased, while median family

income is flat• Debt has become a “problem” rather than a solution• Data show that families are more price conscious• Financial aid offices report steadily rising tendency to

“negotiate” final net tuition • Students “deposit” later and greater “melt” is occurring• More financial aid “appeals”

Questioning the “Value” of College

• Students and families are motived by jobs and careers• Vast majority of those who begin seek a BA, though far

fewer finish one and even fewer finish on time• High unemployment and “under-employment” raise

questions• Government scorecards raise additional questions• Is it worth it?

Consumer orientation

• Students and families now behave as “customers” or “clients”• Other service organizations –even the DMV – make

things simple and effective on line• Students expect similar customer orientation from

colleges they inquire about• They expect to be recruited, to choose the college, not

to be “admitted.”

Implications

• Private higher education is due for a major shakeout that will lead to closures, mergers and consolidations• Scholarship support will need to remain high to meet

price resistance among parents• Less “net tuition” revenue per student and high

discounts will remain• Private institutions will become more like publics to

survive, they will need to dig deeper into the pool• Success will depend on demonstrating value in the job

market and careers to appeal to first generation college students and families

Rays of light

• Value can be demonstrated• Technology and innovative management can produces

savings• Career focus and career education can be demonstrated• Transfer and international students offer undergraduate

opportunities• Adults offer opportunity for both undergraduate and

graduate programs• Colleges can develop their own best “fit” with potential

students, carve out a niche

Conclusion

• As the ready supply of potential college applicants has diminished, so have the resources available to each entering cohort• Resource constraints in the current pool coupled with

declining numbers curtail options for institutions: less pricing power, less discretion in “admissions”• Students and families also have less true choice,

making local, public “choices” more likely. • Opportunity has diminished for both the student and

institutional sides of the equation

References

• Term Enrollment Estimates Fall 2012, (National Student Clearing House Research Center, Fall 2012)

• Term Enrollment Estimates Fall 2013, National Student Clearing House Research Center , Fall 2013)

• Digest of Educational Statistics, 2012,

• Graduate Enrollment and Degrees: 2002 to 2012 (Leila M. Gonzales, Jeffrey R. Allum, Robert S. Sowell) Council of Graduate Schools Graduate Record Examinations Board September 2013

• National Postsecondary Enrollment Trends Before, During, and After the Great Recession (National Student Clearinghouse Research Center Afet Dunbar, Don Hossler, Doug Shapiro Project on Academic Success, Indiana University Jin Chen, Sarah Martin, Vasti Torres, Desiree Zerquera, Mary Ziskin) July 2011

• “Colleges Struggling to Stay Afloat,” Jeffrey J. Selingo New York Times April 12, 2013

• Trends for 2014; the Lawlor Group (http://clients.thelawlorgroup.com/Lawlor_Trends_2014.pdf), particularly on Demand Factors.

Finance and Strategy PlanningOctober 16, 2014

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Mid-Atlantic Association for Colleges of Business Administration 2014

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Vincent CalluzzoDean, Hagan School of Business, Iona College

James Murtha Chairman and CEO, Maguire Associates

Mary Beth CareyVice President for Enrollment Management, Iona College

Ganesh M. PanditAssociate Professor of Accounting and Special Assistant to the Dean

Robert B. Willumstad School of Business, Adelphi University

Presentation Participants

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Agenda /Iona College Case Study

• Higher Education in the News• Sustainable Future for Higher Education?• National and New York State Demographics• Iona Geomarkets• Iona College, Fall 2014 Enrollment Cycle• Post May 1 Strategy• Post May 1 Results• Freshmen Achievements

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Higher Education In the News• St. Mary’s College of Maryland joins troubling trend: Too many empty freshman seats, The Washington Post, November 1, 2013, Nick

Anderson

• Rising Tuition Discounts and Flat Tuition Revenues Squeeze Colleges Even Harder, The Chronicle of Higher Education, July 24, 2014, Scott Carlson

• The Hottest Seat on Campus, The Chronicle of Higher Education, September 15, 2014, Eric Hoover

• New Guide on International Recruitment Agents, AACRO, September 17, 2014

• More Pressure Than Ever: The 2014 Survey of College and University Admissions Directors, Inside Higher Ed, September 18, 2014, Scott Jashik

• Common App No Longer Requires Members to Conduct ‘Holistic’ Reviews, The Chronicle of Higher Education, September 19, 2014, Eric Hoover

• Admissions Leaders Gather to Weigh ‘Prestige, Financial Aid, and Love’, The Chronicle of Higher Education, September 22, 2014, Eric

Hoover • Goals for Enrollment and Tuition Revenue Elude Many Colleges, The Chronicle of Higher Education, October 13, 2014, Scott Carlson

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Sustainable Future for Higher Education?

• Private Colleges at Risk• Failure to meet Enrollment Goals• Revenue Shortfalls• Need for Programs to Increase Revenue

Source: Weathering the Economic Storm: CFOs on Building a Sustainable Future for Higher Education

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Nation-wide High School Graduation Projection 2008 - 2028

Source: National Center for Education Statistics, 2013

2008-2009

2009-2010

2010-2011

2011-2012

2012-2013

2013-2014

2014-2015

2015-2016

2016-2017

2017-2018

2018-2019

2019-2020

2020-2021

2021-2022

2022-2023

2023-2024

2024-2025

2025-2026

2026-2027

2027-2028

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

PublicPrivateTotal

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New York State Public High School Graduation Projection 2008 – 2023

Source: National Center for Education Statistics, 2014

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

150,000

155,000

160,000

165,000

170,000

175,000

180,000

185,000

190,000

195,000

200,000

176,310

185,630

170,290174,530

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Projected percentage change in the number of public high school graduates, by state: School years 2009–10 through 2022-23

Source: National Center for Education Statistics, February 2014

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Recruitment IntelligenceGeomarkets

• Secondary/Tertiary

• NORTHEAST• MA, RI VT, NH, ME, Upstate NY

• DELMARVA• Delaware• Maryland• Virginia/West Virginia • D.C.

• MIDWEST/CENTRAL• Chicago, IL• Milwaukee, WI• St. Louis, MO• Tennessee• Colorado• Ohio

• PACIFIC/NORTHWEST• Portland, OR• Seattle, WA• Spokane, WA• California

• Primary Markets (Tri-State)

• NYC, Westchester, Long Island, Rockland, Dutchess, Ulster

• New Jersey, Pennsylvania • Connecticut

• Emerging/Growing Markets

• Georgia• Texas• Louisiana • North & South Carolina• Florida• Puerto Rico• Arizona • Virgin Islands• Hawaii

The Day The Deposits Stood Still

“April 20th: Black Monday”

The List• National Association for College Admission Counseling’s (NACAC’s) annual College Openings Update

(formerly the “Space Availability Survey”)

• A tool for counselors, parents and teachers as they assist students who have not yet completed the college application and admission process after the May 1 response deadline observed by many colleges.

• In cases where well-qualified students may not have applied to a range of institutions, or may have been turned down by all schools to which they applied, the Update provides a listing of schools accepting applications post-May 1

• The list includes information on the availability of financial aid and housing.

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Post-May 1 Strategy• Guidance Counselor / High School Outreach

• Completed NACAC College Openings Update Survey• Guidance Counselor Relationships• High School Visits

• Call Campaigns• 5 days a week evening hours to 8:30 pm• Reduced to 7:30 during July and August• Segmented populations: regions, quality, non-FAFSA filers, FAFSA filers/no application

for admissions, transfers• Adhered to NACAC guidelines – did not “sell” to those deposited at other schools

• Additional Visit Opportunities/ Immediate Decisions• Last Minute Mondays• Transfer Tuesdays

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Post-May 1 Strategy• Modified Financial Aid Appeal Process• Targeted Additional Aid Dollars

• Freshmen• Transfers

• Melt Management / “Onboarding” Monitoring • Attended Orientation?• Completed Residential Life Contract/Deposit?• Complied with Health Requirements?

• Returning Student Outreach • Supplemented Spring Outreach Activity• Not Yet Registered for Fall• No FAFSA on File

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Post-May 1 Results

Metric May 1 Census Date Increase

Freshmen Gross Deposits 659 872 216

Freshmen Net Deposits 657 802 145

Transfer Gross Deposits 24 102 78

Transfer Net Deposits 24 95 71

Continuing Undergraduate Heads - Fall 1848 2106 258

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Fall 2014 Undergraduate Admissions Achievements• Increased Freshmen applications: 117% of goal

• Increased number of completed applications: 122% of goal

• Increased rate of completed applications: 85% versus plan of 82%

• Actively managing admit rate - increased selectivity: 87% completed application admit rate versus 92% for Fall 2013

• Increased quality of students – average SAT of both admitted (1049) and deposited (1023) students up over prior year (1015)

• 800 enrolled first-time, full-time Freshmen (budget of 760)

• Discount Rate: 50.7%

The Future

• Despite the turbulent environment and enrollment volatility, Iona experienced positive enrollment results• Remain acutely aware of the national trends, shifting demographics,

and challenges in the marketplace • The future sustainability of private liberal arts education is unknown