A Tale of Two Cities

Last fall, as many high school seniors drafted their college application essays and took the SATs one last time, the economy plunged into crisis. Home values dropped, retirement savings accounts dried up and unemployment rates edged ever upward.

Perhaps more than ever before, decisions about where to apply were about money -- sticker price, potential for merit scholarships, and whether financial aid formulas would favorably treat a family’s changing economic realities.

Colleges couldn’t help but worry. At the height of last fall’s chaos, the worst-case scenario seemed like imminent reality. Private institutions anticipated fewer applicants, as those who couldn’t afford to pay out of pocket chose not to apply, or perhaps more applications as students searched out generous aid packages. Public colleges, especially two-year institutions, feared that state budgets would coincide with growing demand from students, especially from unemployed adults and bargain-hunting traditional-age students, stretching their resources to (or past) the breaking point.

With the dark autumn of 2008 now a year in the past, it’s possible to look back at the admissions cycle that led into this fall and examine the local and national trends that drove application and enrollment decisions in the midst of the toughest year in recent memory. Hoping to explore the patterns across sectors and between regions, Inside Higher Ed asked dozens of colleges in the Pittsburgh and Dallas-Fort Worth metropolitan areas to provide data on their undergraduate applications and enrollments for fall 2008 and fall 2009.

Though catastrophe seemed a distinct possibility last fall, most colleges and universities in both regions benefited from a rising enrollment tide, which, along with institution-by-institution strategic changes, made it possible to survive the fall 2009 admissions cycle.

On average, applications to private and public selective institutions were up in both cities. Overall enrollments were up, too, by 3 percent in private-heavy Pittsburgh and 10.5 percent in Dallas-Fort Worth, which is dominated by public colleges and universities and is in a fast-growing state. Public institutions, particularly community colleges, saw dramatic growth, while most private colleges struggled to meet enrollment targets and often increased their use of institutional financial aid to end up with a freshman class about the same size as last year's.

As at many private institutions surveyed, applications were way up for Carlow University’s fall 2009 freshman class. The Pittsburgh college received 15 percent more applications than it did in 2008, but struggled to get students on campus. “Cost was the driving force in final decisions,” says Judith Bolsinger, director of enrollment management. “Students shopped around a little bit more than they have in the past, they compared financial aid packages.”

Carlow admitted a greater percentage of applicants -- from 63.7 percent to 74.4 percent -- but the proportion of admits who enrolled dropped by nearly six points, from 37.1 percent to 31.2 percent. The freshman class totals 261 students, 30 larger than last year’s, but only because Carlow accepted so many more students than it did in fall 2008.

Freshman applications to Texas A&M University-Commerce, a comprehensive public institution 60 miles northeast of Dallas, grew by a less-dramatic 7.3 percent, but the university persuaded a far larger number and percentage of its admitted students to attend. Forty-four percent of admitted first-time freshmen chose to enroll this fall, up from 38 percent last year. The result: a freshman class that grew from 591 to 787.

Mary Hendrix, vice president for student access and success at Commerce, says the university “worked hard to get a higher yield, to show how affordable and high-quality we are.” The economic realities of students priced out of private institutions played a role, too.

Whether in discouraging students from enrolling at private institutions (at least without generous packages), driving recent high school graduates to less expensive institutions with plans to eventually transfer to a pricier one, or luring out of work adults to vocational training programs, the driving factors were economic. “The broad trend is money does matter,” says Laura W. Perna, an associate professor at the University of Pennsylvania’s Graduate School of Education.

Shifts toward less expensive institutions were “definitely a domino effect,” says Jack Maguire, chairman of Maguire Associates and former dean of admissions at Boston College. More than usual, applicants to private colleges looked at public universities, and applicants to publics considered community college a viable place to begin working toward a bachelor’s degree.

But few institutions saw situations quite as bad as they had feared, in large part because the economy swelled enrollments overall, true to higher education's countercyclical nature. In Dallas and Pittsburgh and, indeed, across the nation, few tuition-dependent colleges and universities suffered debilitating budget shortfalls -- or at least have acknowledged so publicly. (Virginia’s Sweet Briar College is one exception.)

“What we anticipated happened in some sense,” says Kim Reid, a senior analyst at Eduventures, who has kept tabs on national enrollment trends at her firm’s member institutions. “But everything was a little less dire than we thought it might be.”

What Is and Isn't Included

Once dominated by steel and other manufacturing industries, Pittsburgh has tried to reinvent itself as a health care and education center at the nexus of the Northeast, Midwest and Mid-Atlantic regions. Unemployment was at 7.7 percent in October, far lower than the national average but well above the 5.0 percent of a year earlier.

So much of the city’s taxable land is owned by nonprofit institutions that Mayor Luke Ravenstahl has proposed a 1 percent tax on college tuition. The University of Pittsburgh, Carnegie Mellon University and La Roche College are among the dozen institutions located within city limits. Close to two dozen more are less than an hour’s drive outside the city.

Dallas-Fort Worth was the country’s fastest-growing metropolitan area during the year ending in July 2008, the most recent data that’s been released by the Census Bureau. Population trends have for decades shown people leaving the Northeast for open land and new industrial development throughout the south. Immigration (legal and not) continues to spur population growth. Unemployment was at 5.3 percent in October 2008 and rose to 8.3 percent this fall.

For-profit institutions generally don’t provide campus-by-campus enrollment data, and several of the companies that operate campuses near Dallas and Pittsburgh declined to provide enrollment data for this survey. But, nationally, enrollments for the sector are way up.

In the quarter that ended Aug. 31, Apollo Group -- which runs the University of Phoenix -- reported enrollments totaling 443,000, a gain of more than 22 percent over the same period in 2008. Enrollments at institutions owned by ITT Educational Services were up 28.7 percent to 79,208. The parent company of Argosy University, the Art Institutes and other for-profits is Pittsburgh-based Education Management Corporation, which reported a total enrollment of 136,000 earlier this year. Same-school growth averaged 22.0 percent.

Community College Boom

The economic downturn was anything but discouraging for community colleges in the Dallas-Fort Worth and Pittsburgh metropolitan areas.

Enrollments at the six districts and freestanding colleges surveyed in the Dallas-Fort Worth area all grew by more than 10 percent. The four community colleges surveyed in and around Pittsburgh had enrollments 2.7 to 10.7 percent larger this fall than they did last fall.

The biggest trends at these institutions were the same ones pushing up community college enrollments nationally: an increasing number of recent high school graduates hoping to save money before transferring to four-year institutions and the inevitable recession-era boom in unemployed and underemployed adults in search of additional training.

“It’s just what we’d predict in this economic situation,” says Penn’s Perna. “Younger, traditional students and older, nontraditional students at once turning to community colleges, hoping for different things and putting different demands on the system.”

Nationally, though, there is no way to gauge the degree to which each group has stimulated community college enrollment growth. The Pew Research Center polled 18-to-24 year-olds and found that 3.4 million -- 11.8 percent -- were enrolled at two-year colleges in fall 2008. “It’s tough for us to know how much of this growth is happening nationally in each age group,” Perna says. “Most of the data we have is institution by institution.”

The Collin County Community College District, with campuses about 20 miles to the north of Dallas, saw the most dramatic expansion, with enrollment up 23.5 percent to 25,935 this fall. Students aged 23 and older made up about 40 percent of the student population during both semesters. Trinity Valley Community College, 30 miles to the southeast of the city, had nearly 1,200 more students this fall than it did in fall 2008, an increase of 17.5 percent.

The greatest growth in raw headcount was at the Dallas County Community College District’s seven colleges, which saw more than 7,000 new students this fall. Enrollment was up 11.4 percent, to 69,047. Chancellor Wright Lassiter says “the economy was a big piece” of what drove the district’s headcount up, among both adults and traditional-age students, populations that grew at about the same rate this fall.

Laid off adults, with and without postsecondary educational experience, turned to the district’s colleges for training. “We had a significant element of adults with bachelor’s, master’s degrees who are coming and enrolling in allied health, nursing, culinary arts,” he says. Those fields, as well as “green” programs in transportation, logistics and nanotechnology, are popular with adults. “They want to learn skills that will get them jobs.”

As for traditional-age students, Lassiter says, the district has seen 15 percent more who enrolled this fall planning to transfer than it did in 2008. “There’s no doubting we’re getting more recent high school graduates looking to us as an option before transferring somewhere else.”

Westmoreland County Community College, in Youngwood, Pa., experienced its largest-ever year-to-year growth between fall 2008 and fall 2009, up 10.7 percent, from 6,416 students to 7,103.

Daniel Obara, the college’s president, points to the same two major factors at play in Dallas. The college’s traditional-age population has been growing for the last four or five years, but this fall in particular, “affordability was a huge reason recent high school grads chose to come here over somewhere else,” he says. “Families that would otherwise be looking at more expensive four-year schools and had students who could be admitted to one of reasonable rigor said, ‘Let’s look at community college, you can transfer somewhere else later on.’ ”

Mary Lou Kennedy, dean of student development at the Community College of Allegheny County’s North Campus, says her institution, which typically has a large nontraditional population, has seen growth in all groups. “People are losing their positions and coming to us for retraining” in fields like nursing, allied health and automotive repair, she says. “But we’re also seeing more and more students fresh out of high school whose parents lost a lot in savings and came to us because they know they’re using their dollars more wisely.”

‘Unprecedented’ Struggles at Privates

The forecast for non-elite independent colleges and universities was especially grim a year ago, in large part because admissions experts weren’t quite sure what to expect.

David McFarland, director of admissions at La Roche College in Pittsburgh, faced an “unprecedented” challenge in attracting new students to apply and enroll at the Roman Catholic liberal arts college for this fall. “There was really no going back and looking at how we’d done things before because there had never been another year like this.”

La Roche started out the admissions cycle last fall down on staff, having lost two or three information technology workers who were key in getting promotional materials and applications to potential students. Freshman applications for fall 2009 fell to 914, from 1,345 the year before. “We were just behind all year,” McFarland says. “We just couldn’t get students to apply in the same numbers as in the past.”

The college typically has a large contingent of students from New York, New Jersey and eastern Pennsylvania, but the downturn seemed to persuade many potential applicants to stay closer to home, he says. Local students looked elsewhere, too. “Instead of coming here, they were saying, look at the value at Slippery Rock or Cal U.,” referring to public colleges -- Slippery Rock University and California University of Pennsylvania -- that are part of the Pennsylvania State System of Higher Education. Some considered community colleges instead.

Though freshman applications were way down, La Roche officials opted not to respond by taking in students of dramatically lower quality than they had in the past, McFarland says. The college admitted 57.2 percent of applicants for fall 2008 and 58.8 percent for fall 2009, which translated to 769 admits in 2008 and 537 for 2009, with a target freshman class of about 200.

The tuition-dependent college was able to avert a potentially disastrous fall by aggressively pursuing admitted students, particularly by offering substantially more merit aid. Its overall discount rate -- the percentage of tuition and fees covered by institutional grants -- was about 40 percent, which McFarland characterizes as "higher" than the year before.

“We couldn’t throw up our arms and say we’re going to have a bad year because of the economy. We had to keep our noses to the ground,” McFarland says. “But it was just a slow, arduous process of convincing families. Financial aid officers were showing families how they could afford it, admissions officers were talking about the value of a liberal arts education.”

One deciding factor for some students and their families was a sort of admittee’s remorse. After declining offers from La Roche in favor of a public institution, “some students whose parents had said, ‘No, you need to go to a state school,’ changed their minds when they saw how full the state schools were,” McFarland speculates. The calculus changed and families of traditional-age students changed their minds: “If we tighten up here and there we can afford to put you through." In all, about 10 students migrated from publics to La Roche.

La Roche drew 190 freshmen, down from fall 2008’s 227. Yield, though, rose from 29.5 percent to 35.4 percent on the backs of admission and aid officers’ aggressive pursuit of admitted students.

Maguire, of Maguire Associates, says La Roche’s strategy was typical in building freshman classes at all but the most selective private institutions. “No tuition-dependent school wants excess capacity,” he says. "If they don’t want empty seats, they’ve got to discount at a much higher rate.” Though their revenue per student will fall, “net revenue won’t necessarily fall if they’re able to draw in more students.”

The strategy at Pittsburgh’s Duquesne University, an independent Roman Catholic institution, was based on the philosophy Maguire describes: get students in seats.

The admission cycle began with a clear indication that enrolling more freshmen was a real possibility. First-year applications soared from 5,715 in fall 2008 to 6,626 for fall 2009. The reasons, says Reid of Eduventures, are likely a mix of college application lists formulated before last fall and families looking for the best possible aid packages from privates.

“When the economic crisis hit last fall, most students already had a set of schools they wanted to apply to. They may have added more publics to the list at the last moment, but many still applied everywhere they planned,” she says. “They were just prepared to shop around for the best deals come the spring.”

Paul-James Cukanna, Duquesne’s associate vice president for enrollment management and director of admissions, says he saw applicants “aware that it would be a competitive market place” for privates to enroll freshmen to start this fall. Students positioned themselves as "in need or in fear" of needing greater institutional aid to be able to enroll.

Though Duquesne had no real change in capacity for its freshman class, Cukanna and his staff chose to admit 734 more students for fall 2009 than they had for 2008.

“We’re dependent on tuition revenues, so we need students in the classroom,” he says, “and we really didn’t know how many we’d end up getting, just that we were unwilling to give up on the quality of our students.” The university raised its discount rate by one percentage point and “worked with students and their parents trying to negotiate better aid packages,” he says. “They know when there’s more competition in the market place it becomes more fierce for colleges to get them. We tried not to feed into that.”

The result: freshman classes of about the same size, 1,437 in 2008 and 1,458 in 2009. But the yield of admitted students was way down, from 33.3 percent to 28.8 percent. In other words, Duquesne gave in to market pressures a bit, but couldn't match others on price. "We simply cannot compete with the state schools," Cukanna says. "And discounting at private colleges creates somewhat of a complicated scenario ... it's an art and science."

The situation was much the same at Dallas Baptist University. Freshman applications rose from 1,305 to 1,601, and though the admitted total rose, the overall acceptance rate dropped from 47.4 percent for fall 2008 to 45.6 percent in 2009. But more admitted students didn’t signal a substantially larger freshman class. Out of 618 admits last year, 350 enrolled. This year, 351 of 730 admits enrolled.

Not all privates saw their applications rise. Southern Methodist University in University Park, Texas, and Texas Christian University in Fort Worth, both had 2 percent fewer freshman applications for fall 2009 than they had for fall 2008. Both also saw drops in their transfer application totals. They responded by upping their admit rates, from 47.7 to 52.4 percent at SMU and from 50.4 percent to 58.9 percent at TCU. Admitting more students didn’t mean the same result for both institutions. SMU’s freshman headcount is 1,329, 69 fewer than it was in 2008. TCU’s is 1,821, 191 students larger than last year’s class.

Victor J. Boschini, TCU's chancellor, summed up the situation facing many privates in his September convocation speech: "The number of applications has risen consistently and dramatically. However, the choices of applicants and their families are becoming increasingly unpredictable. Many apply to numerous schools, then try to negotiate with competing universities for the best financial aid package."

Less Dramatic Rise at 4-Year Publics

Public universities and state colleges are the middle link in the chain of enrollment trends. With sticker prices higher than community colleges but generally lower than private institutions, publics saw some of their typical freshmen look toward community colleges, just as would-be students at private institutions considered public institutions more seriously.

The University of Texas at Arlington was one institution that benefited from being in the middle. “Our numbers were up across the board,” says James D. Spaniolo, the university’s president. “More in-state students, more out-of-state students, more freshmen, more transfers.”

Overall undergraduate headcount at Arlington grew 12.6 percent, to 21,374 this fall. First-time freshmen totaled 2,674, 15.8 percent larger than fall 2008’s cohort of 2,309. The population of new transfers grew even more dramatically, up 23 percent to 3,850 students. The overall undergraduate student headcount is 12.6 percent larger this fall than it was a year ago, now totaling 21,374.

Though the economic factors at play throughout higher education have certainly been significant in driving students to Arlington this fall, Spaniolo says he in part attributes his institution’s growth to active efforts at expanding access and persuading applicants of its affordability. “We’ve been quite aggressive in reaching out to high school and community college students,” he says. “We’ve been working hard over the last few years to tell our story and to share more about the university with the public. I think it’s begun to have an impact.”

One major initiative drawing students to Arlington is Maverick Promise, a program that offers full grant aid for students coming from families with incomes below $65,000. (The previous threshold was $40,000.) “We’re really making serious efforts to make attending as affordable as possible and it’s showing in our enrollment numbers,” Spaniolo says. “UT Arlington’s growth is among the highest at four-year institutions in Texas. And we’re still looking at growth of a couple thousand more students in the next few years.”

The story is similarly dramatic 40 miles to the north at the University of Texas at Dallas, in Richardson. There, this year’s freshman class is 18 percent larger than last year’s, totaling 1,319. New transfers total 1,630, up 16.7 percent.

Freshman applications were up 14.5 percent, says Curt Eley, vice president for enrollment management, but “what we saw as a general rule was that students from the Dallas area applied for admission a little later for fall ’09 than they did for fall ’08.” Because many students held off on applications until they were more certain they’d be able to attend, “our yield was way up,” from 42.2 percent of admitted students for fall 2008 to 46.2 percent for this fall.

Though tuition is lower at UT-Dallas than it is at private institutions, it is the most expensive public institution in the Dallas-Fort Worth metropolitan area, Eley says, and that has translated into losing students not just to community colleges but to less expensive public institutions. “We’re the most expensive by a long shot and students who might’ve come here two years ago are choosing the University of North Texas or the University of Texas at Arlington instead.”

Students transferring out of community colleges, he adds, were deterred by UTD’s comparative expense among publics. “We heard definite hesitation about taking on the expense of a four-year school. Students wanted to stay at community colleges as long as possible to save money and avoid getting themselves in trouble in case their parents lost their jobs or their economic situations otherwise got worse.”

Application and enrollment growth at public universities in the Pittsburgh metropolitan area was far less dramatic, likely because of the demographic differences between the two regions. The University of Pittsburgh, the largest public in the region, saw freshman applications tick up five percent to 21,737.

Freshman and overall undergraduate enrollments at the three Penn State branch campuses in the area -- Beaver, Greater Allegheny and New Kensington -- didn’t change very much. Some numbers were up, some down, but nothing changed too dramatically. Combined freshman headcounts on the three campuses fell by 14 students, to 916. and combined undergraduate headcounts fell 55 students to 2,420.

More substantial growth happened at the three members of the Pennsylvania State System of Higher Education in the Pittsburgh area -- California University of Pennsylvania, Indiana University of Pennsylvania and Slippery Rock University. Enrollments at each of the three institutions rose between 2 and 4 percent, still not nearly as dramatic as the change that happened at Dallas-Fort Worth’s publics.

Going Forward

Though most institutions were able to avoid peril this fall, the forecast for fall 2010 suggests widely different results by sector.

Community colleges, says Jerome A. Lucido, vice provost for enrollment policy and management at the University of Southern California, "will continue to swell and swell rapidly, particularly in those areas of the country with larger lower income or immigrant populations."

Reid, of Eduventures, says she expects to see more "evidence of shifting enrollment," as students flock toward community colleges and public universities. "There's a lot of movement of enrollment that hasn't happened before," she says. "This whole notion of fluidity -- start at a community college or a state university and then transfer to another or to a private -- is new and is likely to only expand."

Kevin Crockett, president and CEO of enrollment management consulting firm Noel-Levitz, says he sees "the coming year [as] really challenging to predict" individually, institutionally or nationwide. Applications will probably be up (and many preliminary data show that), but it will be hard to know whether applicants are truly interested in an institution or just hoping for a good aid package.

Independent colleges are "left with sort of a lingering question of whether what happened this year is sustainable," whether highly competitive institutional aid packages are the best way of attracting students, Reid says. "Is this a blip? As the economy turns around, are they going to move back on their discount rate a bit? Or, is this a sea change?"

Lucido, who is also executive director of USC's Center for Enrollment Research, Policy and Practice, thinks private institutions will "continue to compete very hard" for next fall's freshmen. "Messages are more about value than about strict price and discounting," he says. "And applicants and their families have more time to sit down and think, ponder the economy, and figure out what's best for us."

The table below presents data on the fall's enrollment picture in the Pittsburgh and Dallas-Fort Worth metropolitan areas.

Undergraduate Enrollments, Fall 2008 and 2009