Another round of university layoffs. Another budget shortfall. This time, it’s right here in New Orleans.
The University of New Orleans is facing tough choices. A $15 million budget deficit has led to academic restructuring, layoffs, and furloughs – all in an effort to keep the institution financially stable. But UNO isn’t alone. Schools are suffering this higher ed enrollment decline nationwide.
Across the country, universities are struggling with the same challenges. Brown University is working to close a $46 million budget gap. Sonoma State is cutting programs to deal with a $24 million shortfall. The University of Wisconsin-Oshkosh is laying off employees as it grapples with an $18 million deficit.
This isn’t just a string of isolated incidents. It’s a pattern. A sign that the traditional higher ed financial model is breaking down.
And if universities don’t adapt, more closures and cuts are inevitable.
The bigger picture of the enrollment decline
Brown, Sonoma State, UW-Oshkosh – different schools, same problem. Budgets are shrinking, jobs are disappearing, and entire programs are getting cut.
Why? Fewer students are enrolling. Costs keep climbing. And a lot of universities are still clinging to a financial model that just doesn’t work anymore.
Scott Galloway called this years ago.
At the start of the pandemic, he predicted that dozens of universities – especially those in the middle tier – would struggle to survive as costs outpaced revenue and digital alternatives gained traction.
He compared higher ed to retail: elite brands (think Harvard, Stanford) would thrive, while struggling institutions would either consolidate or disappear.
We’re seeing that play out right now. Schools with massive endowments or strong brands should weather the storm. But regional universities, tuition-dependent schools, and those slow to adapt? They’re in real trouble.
But Brown is Ivy League. It’s unusual for a school with that level of prestige and endowment to be facing a budget shortfall, which makes their situation even more telling. If an Ivy League school is struggling with finances, it underscores just how deep the issues run across higher ed.
For years, college was the obvious next step. Now? Not so much. Families are questioning the price tag. Students are looking at faster, cheaper alternatives. And universities that don’t adjust are feeling it – hard.
The ones that figure this out will survive. Those that don’t? They’ll be next in line for layoffs and closures.
Does the higher ed enrollment decline matters outside the ivory tower?
The short answer – absolutely.
When universities cut jobs, it’s not just faculty and staff who feel it.
Local businesses lose customers. Research that could drive innovation stalls out. Industries that rely on skilled graduates start seeing shortages. The effects go far beyond campus.
And for students, program cuts and resource shifts can change everything.
Fewer course options, larger class sizes, reduced support – all of it impacts their education and career prospects. The degree they planned for might not be the one they end up with.
Higher ed isn’t just an academic institution issue. It’s an economic one. And if these trends continue, the fallout will reach far beyond the ivory tower.
What do higher ed institutions need to change?
First, they need to rethink how they make money. The days of relying almost entirely on undergraduate tuition are over.
Schools that want to stay competitive need to invest in lifelong learning, expand online programs, and build corporate partnerships that create new revenue streams.
Second, schools need to do a better job of getting the word out.
With cheap credit, college tuition has exploded over the past decades.
There’s no longer an ROI for many students on a four year degree. Every learner is precious, and schools that want to keep serving them need to differentiate themselves in a sea of very expensive sameness.
Without good messaging and delivery (aka marketing) whatever differentiation there is will get lost in the noise.
Third, they need a serious reality check on financial planning.
Some institutions are still budgeting like enrollment will bounce back to pre-pandemic levels. It won’t. Schools that don’t adjust now will be the next ones announcing layoffs and closures.
Finally, innovation isn’t optional – it’s survival.
The universities that adapt by focusing on high-demand programs, workforce-aligned training, and flexible learning models will come out ahead.
Those that don’t? If the current higher ed enrollment decline continues, they won’t be around much longer.
Is higher ed ready to face reality?
Higher ed is at a crossroads. Some institutions will evolve and survive – others won’t.
What do you think universities should be doing right now to stay ahead?
Image credit: File:UNO University Center A.JPG – Wikimedia Commons
