May 2008 Lawlor Focus
The Summer Melt Factor
May 1 has come and gone, but an air of cautious optimism and resigned pessimism permeates the college admission landscape. Admission officers are reporting a mixed bag of results. Some schools are having a "boom year" in terms of deposits, some are "right on the mark," some are "stagnant at best," and some are seeing a drop in deposits. And everyone is questioning the reliability of deposits as a realistic indicator of fall enrollment. "It makes me wonder what may happen with summer melt," mused one chief enrollment officer.
Judging from both the economic climate and financial aid alarmism in mainstream media articles, it seems admission departments have reason to be wary of summer melt. Consider the convergence of these factors:
Plunging consumer confidence—The May 2008 BIG Executive Briefing reports, "Although government stimulus checks recently began arriving in mailboxes, climbing gas prices and a still unstable housing market continue to wreak havoc on consumers' psyches as economic sentiment continues to decline … fewer than one in five (19.5%) contend they are confident/very confident in chances for a strong economy, down more than three points from April (23.0%), 25 points from May '07 (44.7%) and a new low."
Perception of widespread "gapping"—U.S. News & World Report asserted, "Although college tuition prices are at an all-time high, colleges are, on average, issuing stingier financial aid packages this year, say counselors who've been helping families with their college finances." A counselor recently posted to the NACAC listserv, "In my 25 years or so in the financial aid market, I have not seen the practice of gapping in greater evidence."
Student loan industry woes—The federal government has now taken steps to avert a possible student loan shortage in the coming months, prompting a legislator to say that "students and families now have every assurance that they will continue to have access to all the federal student loans they are eligible for, no matter what happens in the nation's financial markets." Yet, as an NPR story points out, even students who receive the maximum amount of federal aid can still find themselves requiring additional private loans-loans that require good credit and often come with higher interest rates and fees. The Chronicle of Higher Education (subscription required) reports that "some colleges are developing contingency plans to help students enroll even if bank loans fall through."
Double deposits; wait-list shuffle—Once again, the New York Times focuses only on the elite privates, saying that plans of Harvard, Princeton and Penn to offer admission to more students from their wait lists than normal this year are "creating ripples that will send other highly selective colleges deeper into their waiting lists, as well." But there's also a perception that "double deposits have never been more prevalent," leading some to predict ripple effects for that reason, too.
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Together these factors create an uncertain picture for the next few months, in terms of whether deposited students will actually enroll. As some chief enrollment officers have mused over the years, "You just don't know for sure whether students are coming until you see the whites of their eyes and their butts in the seats." If we have a mantra for the summer, it's "stay in touch with your prospects" (with notes, calls, send-off events, etc.), so you can minimize the melt.
But don't forget, the uncertainty applies to retention numbers, as well, since the same economic concerns that are plaguing prospective students and their families may be causing consternation with the families of current students. As you continue to reinforce your value proposition and assuage the financial anxieties of the families of prospective students during the summer, do the same for returning students and their families.
In the News
The Chicago Tribune recently called attention to Berea College in Kentucky, where for more than a century no student has been billed for tuition. (Instead, the college has an on-campus work requirement.) The article was pegged to "the season of mixed emotions for parents of the college-bound," when "[t]he joy of a letter of acceptance is followed by the sobering message of a tuition bill." Less noticed was Johnson C. Smith University's tuition freeze announcement, stating the HBCU would "hold tuition and room/board costs at its current level in response to the nation's current economic condition."
Did you know?
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