When Schools Collide: The College Merger Process (INFOGRAPHIC)

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Brian Wallace, Founder & President, NowSourcing

From 2018 to 2022, 95 college mergers took place, up 21% from any prior point in the 21st century. For many, merging with another school was a last ditch effort to prevent permanent shutdown. While the federal government has invested billions in keeping higher education afloat, up to 500 4-year schools may yet close their doors in the near future. The COVID-19 pandemic created a short term crisis, but the causes behind falling enrollment go beyond coronavirus.

Since the pandemic, nearly 1.4 million fewer students are attending college. Up to 40% of prospective students are delaying college due to financial strain or a desire for a return to normalcy in education. Some students are opting out of formal higher education altogether. It’s no longer the case that a college degree guarantees higher income than that of a high school grad. From 2020 to 2022, 10% of Americans with low wage positions shifted to a highly-skilled job with the help of online certifications. If both universities and online certification programs teach the same things online, why wouldn’t a student choose the more affordable option?

Beyond enrollment, colleges are one of the many places experiencing a staffing crisis. It’s a familiar story: institutions had to furlough employees during the pandemic. Those furloughed found new positions or took early retirement offers. Now that colleges are opening back up, more than half are worried about serving students with current staffing levels. Merging can solve some of these problems by tapping into economies of scale, particularly in administrative or support positions. 

Not every school is at equal risk for merger. Most deals involve two schools located in the same state with less than 5,000 students at each. Smaller, less prestigious private schools are seeing higher-than-average declines in enrollment, which makes them more likely to merge. From 2016 to 2021, about 43% of closing or merging schools were religiously affiliated, private, and not for profit. Cross country mergers like Northeastern University and Mills College are rare and unlikely to be approved by trustees or accrediting bodies.

While mergers can keep schools from shutting down, the process still raises concerns for students, faculty, and alumni. Smaller schools may offer a unique student experience pre-closure. These schools fear they will lose their identity, voice, and support structures in the merging process. Equity and inclusion for minority students is easily overlooked in the planning of a merger. 

 

The College Merger Explosion: Why Colleges are Failing


Brian WallaceAbout the Author: Brian Wallace is the Founder and President of NowSourcing, an industry leading infographic design agency in Louisville, KY and Cincinnati, OH which works with companies ranging from startups to Fortune 500s. Brian runs #LinkedInLocal events, hosts the Next Action Podcast, and has been named a Google Small Business Adviser for 2016-present. Follow Brian Wallace on LinkedIn as well as Twitter.