Financial Burdens on Higher Ed

 

The Great Recession that lasted from 2007 t0 2009 has left a lasting impact on the U.S. economy to this day. Many state governments are cutting the funding they allocate to public universities, and the federal government has cut the funding of grants that both public and private institutions rely on as well (Norton, 2013). Although I do not currently work in a university setting I have noticed decreased funding to state-funded grant programs in my profession. As a manager of a town, I have learned that the numerous grant opportunities that existed pre Great Recession. State Governments have begun to reduce the funding to Higher Education as attendance rises. This has compounded the problem the situation for universities and made it even more difficult to allocate funding. With the cost of attendance rising, however, financial aid budgets are stretched because universities invest heavily in students who use financial aid (Barr & McClellan, pg. 9).

 

Governor Scott Walker of Wisconsin found himself in the news frequently when he proposed a $300 million dollar budget cut to the University of Wisconsin system, leading employees in the system to believe over half of them would lose their jobs because of the cuts (John Conley, 2015). The following video covers the proposed budget cuts by the Governor:  The proposal from the Gov. Walker slashes support for the university system by 13% and, more importantly, it includes a 25% cut to essential educational functions which includes such things as advising and instruction (Conley, 2015). Cutting these functions has the potential to negatively effect students. Many, including myself, fear this will ultimately effect the quality of graduates entering the workforce (Myers, 2012).

 

The following graft shows that Gov. Walker wants to cut funding to the Higher Ed. system as student tuition has risen to 50% of total educational revenue. In the past, tuition revenue hovered around 35% to 40% of total revenue, which ultimately pushes the burden of cost onto the students. This comes at a time when costs are already at an all-time high.   Many students are now coming to college and finding higher fees and fewer services for the money they do pay (Cox, Mathews & Associates, 2003).

 

This leads me to believe that the financial crisis that began in 2007 is still having an impact of how political leaders in our country make monetary decisions. As I have seen from personal experience and through the aforementioned research, states are forcing students to take on the economic hardship that has carried over from the Great Recession by cutting funding and forcing universities to raise tuition costs. As an administrator it is difficult to implement these cuts and decide where the cuts will  take place. Although regulations and laws pertaining to funding do outline how and where cuts can be made, it is still difficult to implement those cuts in a leadership position, and those decisions should not be taken lightly.

 

Sources

 

Barr, M., & McClellan, G. (2011). The Fiscal Context and the Role of the Budget Manager. In Budgets and Financial Management in Higher Education (p. 9). San Francisco, CA: Jossey-Bass.

 

Myers, Jimmy. "Higher Education Budget Cuts Likely to Hurt Programs." McClatchy - Tribune Business News (2012). Print.

 

Conley, John. "This Is What Wisconsin's 2.5% Budget Cut Looks Like." The Chronicle (2015). Print.

 

Norton, Andrew. "With Tighter Budgets, Universities Must Change Course." Crikey.com. 15 Apr. 2013. Web. 9 Sept. 2015.

 

UW budget cuts reduced, tenure eliminated from law [Motion picture]. (2015). United States: Channel3000.com.