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    May 2013

    What Did the Recession Teach Us?

    As the economy recovers, albeit more slowly than any of us would want, I wonder: will we look back on the great recession with the comfort and perspective of hindsight and judge education as over-reacting to the risks, ignoring the opportunities? Did some colleges and universities miss opportunities for investments, hiring faculty, expanding into new enrollment markets or other strategic and, yes, courageous moves? Did higher education fail to understand the societal shifts that were changing the behavior of students and their families? Looking inward instead of focusing a clear eye on the environment is a risk.

    It is easy to forget the panic that engulfed us in 2008-2009 as the stock market moves into record-setting territory, capital campaigns are in full swing, and our attention is shifting to blended learning and new frontiers. I don't want to minimize that dark reality, but as institutions implement enterprise risk management (ERM), they often overlook the upside of risk—new opportunities.

    We should note the missed opportunities of the recession. My take is that governing boards, presidents, and chief financial officers understandably responded to the crisis with mandates to rein in discount rates, freeze salaries and hiring, and defer maintenance until the worst was past. What education missed in the belt-tightening was the effect the recession would have on our markets, and what opportunities it would present. Would families and prospective students emerge with radically different perspectives on the value of a college education? What investments could be made to address these changes?

    A faculty member recently told me, "With the economic recession, our students are much more focused on getting a job after college, so we now have to change the experiences we give them in the classroom and in field work." She said this desire for a job rather than graduate school after college is a phase, rather than a long-term cultural shift that liberal arts colleges should address.

    I don't know if we will go back to the time when the return on investment of a BA or master's degree or major is not a driving factor in choosing a college or graduate program. But a lesson we can all take away from the recession and the recovery is to consider both risks and opportunities when developing a risk register for your institution. 

    By Janice M. Abraham, President and CEO

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