Colleges Want More Of The Shrinking Pie
Recently an article came out in Forbes that explained all colleges, including the Ivy League, will get slightly easier to get into because of the impending demographic cliff. We disagree. What is the demographic cliff? The demographic cliff refers to how the number of traditional college-aged students will peak in 2025 and then decline dramatically for several years, the result primarily of declining birth rates following the 2008 recession. Currently, according to the National Center for Education Statistics, roughly 62% of all high school graduates attend college. 43% of high school completers immediately enrolled in 4-year institutions and 19% immediately enrolled in 2-year institutions. It sounds like it should make sense that if the number of students in high school decreases, then the number of students applying to colleges should also decrease. While that might be the case for the majority of colleges in this country, this is not unexpected and colleges have been planning for it. The selective colleges have the resources to plan the most effectively and we do not see them becoming less selective. Here’s why. They knew the pie was shrinking so they needed a bigger slice of the pie, or they needed to grow the pie (or both). How do they do that? By focusing on groups who historically have not attended college or at least not their colleges.
In fact, this effort has been successful as you can see from this chart showing 6% growth, this year alone, in the number of students submitting applications via the Common App (CA).
One of the major reasons colleges care about staying more selective and keeping their application numbers up, even if/when applications decline, is a college’s Moody’s bond rating is 20% based on their application numbers and acceptance rates. This determines the rate at which they can borrow money to build their capital projects. These capital projects in turn help attract more students to apply. In reality, we are part of the problem. We are all swayed by fancy dorms and beautiful campuses and these bonuses do not mean that a college is better.
So how have highly selective colleges been creating a bigger slice of the pie? They have partnered with the many community-based organizations, programs, and networks that have been created to allow underserved population students more opportunity. Some examples below.
QuestBridge College Match Program
Small Town and Rural Students (STARS) College Network
Colleges are partnering with these organizations and many more to recruit underserved students. They are using databases such as Opportunity Atlas and the College Board’s Landscape to determine the background of applicants, based on schools and neighborhoods. THIS IS AMAZING AND SHOULD BE APPLAUDED. Since 2019, low-income applicants have increased at nearly three times the rate of higher-income applicants, but they are still underrepresented in the applicant pool (source Common App Deadline Update March 2024). Colleges are working to add 650,000 more lower and middle-income students by 2030. This increased access for more underserved populations is incredibly important. First because where many of these students go to college has a profound impact on their lives, far greater than for students from privileged backgrounds. In addition, studies show that diverse college communities improve learning for everyone.
In the chart below, you can see how much higher the growth rate in applicants from lower-income zip codes and who are eligible for fee waivers has been recent, a trend that colleges and the Common App are working to continue.
In addition, more colleges at the top are offering more aid plus no loans for the middle class and loans to international students. Examples are Dartmouth, Vanderbilt, and Washington University in St Louis which have all announced initiatives to this effect. Many if not all of the top colleges have been working towards this. Two years ago when we visited, Lafayette told us that their priority was to admit more of the middle class going to college and to make it more affordable for them.
You can see in the charts below that even internationally the colleges have been focusing on growing their applicant pools with countries where students did not typically apply before to the US, such as Ghana. I spoke with one admissions officer who said she could fill a whole class with students from Ghana.
Colleges are investing in this priority. In July 2022, Bowdoin became need-blind for international applicants, and they also use grants, not loans, to meet need. This is part of what caused their applications to rise significantly both last year and this year. Brown announced at the end of January that next year, they will be need-blind for international students. Colleges like Wesleyan offer special scholarships for international students from certain continents. Each year, they offer several full-ride scholarships to students from Asia and Africa.
I want to digress for a minute. Last year’s Supreme Court ban on race-conscious admissions has not deterred colleges from their mission to solicit, attract, and serve students who were not previously attending their colleges. The Supreme Court decision simply accelerated the move toward a focus on socioeconomic background, rural students, more aid to middle incomes, and no loans. For example, this past cycle Duke admitted 97 students ED through Questbridge, which is almost double the number they admitted last year.
I am thrilled our selective colleges are becoming more diverse and equitable places, but part of the push for underserved population students and scholarships to accommodate them is this need to garner a larger segment of the student population than was previously applying to colleges. This is what we believe the Forbes article missed: we have and will continue to have an entirely new group of students applying to selective colleges. This increase in the applicant pool is part of why we have seen such a decrease in admit rates of highly selective colleges and it has created more uncertainty than ever before. The move to test-optional admissions for many colleges has also contributed to increased uncertainty about where a student will be accepted. This has led students to apply to more colleges. We used to counsel our students to apply to 8-10 colleges and now many of our students apply to 12-14. Again, we are all in part contributing to the problem. Unlike Forbes, I do not see our selective institutions becoming materially easier because of the demographic cliff in coming years, if anything I predict application numbers will remain steady or we might even see application numbers rise.