College Mergers: When Colleges Think Like Startups

Colleges today represent an interesting intersection between old tradition and new thought. Many colleges have roots as early as the 1800’s but are simultaneously some of the most progressive places in the country. College mergers are the perfect representation of colleges’ place in society, an old idea that now represents the future fate for many today.

Before diving into what a merger is, it’s important to understand why one would even be necessary. The primary reason for a college to merge with another is to preserve itself in times of struggle, and colleges have experienced more struggle since the COVID pandemic than they have in the past few decades. This comes in a few different forms, the most important of which is the declining enrollment rates of existing high school seniors.

College Mergers By the Numbers

Since March 2022, up to 40% of prospective students are delaying their enrollment into college due to worries around finances or in-class versus virtual teaching. This translates into a 16% decline in two year college and 6% four year college enrollment.

These are not insignificant numbers, and there is certainly a cause n top of the obvious factors around COVID. The value of a college education has been steadily dropping year after year. Even before COVID in 2019, only 51% of adult Americans thought a college degree was “very important” in comparison to 70% in 2013.

This reflects how the disparity between college graduates and high school graduates has been shifting. While college graduates used to have what was a near-guaranteed career and source of income, nowadays even after 10 years of work, one in six college grads still end up earning less than the average high school graduate. Jobs nowadays are shifting towards certificates and experience, and away from a simple degree or a degree alone.

How Colleges Remain Competitive

On top of all of this, colleges are also having problems with staffing. COVID has caused staffing shortages in many colleges that have simply not rebounded, some to the point of falling below typical regulations. This only further pushes students away from enrolling in colleges, especially those that are already experiencing issues.

Knowing this all, it should come at no surprise that many colleges are finding themselves in dire economic circumstances. For many colleges, this means a simple closure, but for many others, they’re finding new life through mergers. A college merger occurs when the board of trustees and accrediting bodies of the institution confirm the process with the approval of others like faculty, alumni, and business partners.

After this the merger will start to take place at one of four scales. These range from smaller local mergers to national and international or even digital mergers. This can mean combining the physical campuses, taking the faculty of the merged college, and almost definitely taking the students. Although each merger will develop its own terms and conditions.

This does come with a slew of minor downsides. Things like a higher tuition are almost guaranteed, while other factors like loss of culture, identity, and voice are common but not guaranteed. The large challenge to many mergers is the merging college is coming into the situation at a point of disadvantage, wanting to merge over a simple closure in many cases. 

Closing Thoughts

On the plus side a college merger will reveal a much clearer path for students than a complete closure. It will also retain at least some of the staff and will generally work to strengthen a different institution rather than simply removing a college from existence. It’s a ray of hope for students and staff alike in a time very few expect to experience when getting themselves involved on a college campus. This is the value of a college merger.