Small Colleges Face Challenges — and Opportunities

Recent headlines haven’t been encouraging for small colleges and universities.

Moody’s Investor Service forecasts that closure rates for these institutions will triple in the coming years, and mergers will double, as schools face what Time magazine recently called the “Death Spiral” of declining admissions, tuition revenue and contributions.

Moody’s found that the percentage of small colleges with a sustained three-year growth rate of less than 2 percent increased fivefold, to 50 percent, from 2006 to 2014.

These trends and challenges are very real, but so is the desire of most small institutions to remain viable. In recent years, schools have tightened belts, cut faculty and staff, sold real estate and broadened recruiting efforts to new student populations. Their tenacity and nimbleness—and willingness to change and not just stand still—will be great assets as they navigate difficult conditions. 

We also predict that the long-term visions that these institutions have to remain intimate and connected to their communities and students will provide strong foundations from which they can adapt to meet changing situations.

Bucking the Trend

We’ve seen just that occur at Sewanee: The University of the South, a small liberal arts college in Sewanee, Tennessee. The University is one of the very few small liberal arts colleges with more than 20 Rhodes Scholars.

Sewanee made national news in 2011 when it became the first liberal arts college of its ilk to make the bold move of cutting tuition—which it did by 10 percent. The next year, the school pushed the envelope further by stating that costs would remain stable all four years of a student’s time at the school.

Stepping back from the high-tuition, high-discount model that it and its peers had long used, the University hoped to positively impact public perception of accessibility to a quality liberal arts education. Applications to Sewanee soared, and selectivity improved. This fall, the school received 4,423 applications, up from 2,921 in 2011. The University has grown to 1,660 students, up from 1,400 in 2011. It’s now admitting about 40 percent of applicants, down from about 60 percent five years ago. Like many institutions, Sewanee is also expanding its reach beyond its Southeast heritage to draw students from throughout the U.S., which it is increasingly successful in doing.

“Sewanee is prospering, while other liberal arts colleges and universities are flagging, because of the effectiveness of strategic choices,” wrote Michael Moran in the National Association of College and University Business Officers publication in 2014. Other schools continue to follow Sewanee's lead. Of late, Rosemont College and LaSalle University have also reduced tuition.

But universities don’t thrive for generations without making other innovations outside of finances. Sewanee is pushing on many fronts to better shape its physical campus to support student success, health and retention, while utilizing existing infrastructure. 

In support of University strategic objectives, its master plan has guided its growth to curb infrastructure sprawl and reinvigorate the campus core. New residential communities near the center of campus are increasing 24-hour student presence around the core and visibility of student activities. The University is also moving its School of Theology back to the center of campus from its current location about a seven-minute walk away. This facility is also envisioned to include a large "living room" space to promote opportunities for interaction between Theology students and students in the college.

Redefining Commons

Sewanee is also amid the design phase of creating a new recreation commons in an historic building in the campus core that is now a bookstore. The design will add recreation space while consolidating wellness programs and its signature Outdoors Program in a single location. Rather than just be a place to work out, the recreation commons is envisioned as a place for students to hang out, see others and be seen—all of which supports a stronger sense of community. Sewanee’s future also calls for repurposing underutilized space in the library into a learning commons, which will create a multi-use, 24-hour space for projects and research while adding to the portfolio of commons spaces. 

The notion of community has always been core to Sewanee. The idea behind the commons’ initiatives is to create intimate, community-focused places that align with the institution’s culture and intent, which is to remain small, devoted to liberal arts and to build community. Rather than a single, large student center, the University is creating a network of smaller, intimate spaces with intentional and complementary program objectives. This approach also takes advantage of existing infrastructure and addresses deferred maintenance. 

As small colleges and universities address growing pressures, vision and measured thoughtfulness is vital in financial and physical planning. Institutions need to be innovative in planning for their existing facilities to support strategic objectives. While budget concerns and other pressures weigh heavy on decisions, Sewanee's focus on the long-term while remaining nimble in the short-term is setting a model for success with small private institutions.