A decade ago, David A. Thomas, an academic administrator who currently serves as the 12th president of Morehouse College, identified the pressing need to restore confidence in higher education and tackle affordability issues, emphasizing the importance of institutional support and a commitment to being genuinely need-blind and free of debt.
On March 26, 2025, Morehouse College hosted a “Higher Ed Disrupted” seminar to explore new ideas for innovation and access in education. The fireside chat featured Thomas, president of Morehouse College; Malcolm Gladwell, author and podcast host; and Matthew A. Scogin, president of Hope College.
Last year, S&P Global Ratings released its U.S. Not-for-Profit Higher Education Outlook for 2025.
The report indicated that many colleges and universities face enrollment challenges.
Many institutions struggle with undergraduate enrollment amid debates about their value propositions and increasing student competition. S&P anticipates that these challenges will intensify due to what they refer to as the impending demographic cliff.
The report also highlighted rising costs for faculty and staff while emphasizing the difficulties in predicting enrollment and operating revenues.
Given these operating pressures, S&P is monitoring lower-rated institutions for declines in unrestricted resources, as strong balance sheets, fundraising capabilities, and access to liquidity are crucial for their stability.
Additionally, the report noted that many colleges and universities are considering mergers, acquisitions, and partnerships to enhance efficiencies and strategic positioning. For some institutions, closure seems inevitable.
The report also mentioned increasing event-related risks, testing risk management strategies, and educational institutions’ liquidity during operational instability.
College athletics are changing significantly due to shifting revenues, costs, and facility requirements. In December 2024, S&P predicted that changing policies might impact federal grants, funding, and endowment taxes, signaling potential changes in credit quality for 2025.
Moody’s report on the U.S. higher education sector adopts a negative outlook and reflects several challenges stemming from federal policy actions.
Cuts to research funding are diminishing financial resources for institutions relying heavily on federal grants, jeopardizing their ability to maintain research programs.
Staff reductions at the U.S. Department of Education are causing administrative delays that may affect the timely processing of federal student aid and other critical services.
Moreover, uncertainty surrounding federal student aid administration is heightening financial pressure on colleges and universities, complicating their efforts in planning and budgeting for future enrollment and revenue streams.
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