My current employer, a state university, may technically go out of business in July. Naturally, management blames the lack of funding. There are two issues at stake.
Firstly, the University has been chronically in the red. This means that tuitions and government grants are not sufficient to cover cost. Meanwhile, the number of faculty members has gone up 5% in the last few years. So, surely, someone expected the University to have increased revenues. But from where?
Secondly, the University has invested massively in real estate. I mean millions and millions of dollars in buildings. What for? To accommodate the increasing number of students? Actually, the number of students attending classrooms has been pretty stable in recent years. Whereas the business students keep on coming, the sciences are not attracting more students as time passes. Distance education is another matter: the number of students taking online courses is growing by more than 10% a year. But as anyone knows, distance education does not require large buildings.
I find this interesting. Isn’t it the job of managers to do the best they can with whatever budget they have? If you are a highly paid university manager and you spend and spend without counting, then where is the challenge in this?
It seems that spending the money then turning around and say “oops! we spent money we didn’t have” is irresponsible. You’d think people would get fired over this, but they won’t.
What is going to happen? Clearly, less popular courses and programs will have to go. There is no other way to reliably save money when you are a university. The only recipe for profit is to focus on the profitable programs (Business!!! more Business!!!) and to slash less profitables one (Physics?). Except for distance education, of course, which will continue to slowly grow, unnoticed, and without any expensive building to support it.
(No, I do not expect to lose my job. Not for now anyhow.)