(MoneyWatch) Millions of parents across the U.S. are no doubt stressing about whether their children will get into good colleges and universities and, of course, how they will pay the tab. And colleges are worried, too.
An insightful new white paper by Jon McGee, a vice president at the College of Saint Benedict and Saint John's University in Minnesota and a frequent speaker on national higher-ed issues, captures some of these institutional worries.
Why should families should care about the challenges facing college administrators? Because the pressures that these institutions are experiencing will ultimately impact how higher education is delivered in this country. Education is being "disrupted," just as the music, automotive, steel, publishing, newspaper, and many other industries have been re-shaped by the forces of technology and competition over the decades. We just don't know what forms this upheaval will take.
"The question for most colleges will not be whether they survive, but rather how they will adapt to succeed in a new marketplace," McGee wrote in the paper, which was released by the Lawlor Group, a higher-education marketing firm.
What's worrying college administrators
Here are seven things keeping college presidents up at night, McGree wrote:
1. After peaking in 2008, the number of high school students has been declining slowly. This is creating more competition among schools hustling for students and putting pressure on the institutions' admission yields.
2. While high school grads in the West and South have remained mostly stable, the number of teenagers has declined significantly in the East and Midwest. This is creating problems for schools in the latter regions since most students attend college within 100 miles of their home.
3. Between 2000 and 2010, the real median income for families dropped nearly 11 percent. Adjusted for inflation, the median income is now similar to what it was in 1996. How are parents supposed to pay for school?
4. High unemployment remains persistent. Roughly 23 million Americans are unemployed, underemployed, or have given up looking for work. The number of people who have been unemployed more than 27 weeks, which currently constitute 42 percent of the unemployed, is double the historic average.
5. Many families owe more on their mortgages than their homes are worth. Since home values peaked in April 2006, home prices have dropped 34 percent.
6. With flat and falling income and high unemployment, many American families are poorer now than they were five years ago. This phenomenon, observes McGee, "has and will continue to have extraordinary implications for financial aid and college affordability."
7. Looking further into the future, the financial reality for younger families (ages 25 to 34), who will eventually be sending their children to college, is grim. Real income among this group declined by nearly 13 percent between 2000 and 2010.
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