Falling enrollment tracks with decline in enrollment nationwide, changes in competition.
While student enrollment has been falling across the country for years, Pacific University administration was shocked by a 50 percent drop in incoming enrollment for the School of Pharmacy graduate program this fall.
The Pacific Index met with VP for Enrollment Management and Dean of the College of Arts and Sciences Dr. Sarah Phillips and with VP for Finance and Administration Jim Langstraat to learn what caused this sudden drop—and, more pressing, what the loss means for Pacific University’s revenue and programs, and what Pacific will do to adapt.
Both Phillips and Langstraat were quick to assure that while the revenue loss will be painful in the short term, Pacific University is fine, and will not be shutting down any programs. Pacific runs on a balanced annual operating budget of about $130 million, which, according to Langstraat, is “budgeted out to a line item or corresponding expenditure, except we keep around $2.5 million in contingency that is used for things like any emergency building repairs.” He added, “it can also be used to cover enrollment fluctuations.”
However, this was no standard fluctuation. The expected revenue shortfall from the Pharmacy program for this year is also approximately $2.5 million—the equivalent of the entire contingency budget. According to Langstraat, much of that shortfall will be covered by not filling open faculty positions in the School of Pharmacy for this year.
Langstraat and Phillips assure the Pacific community that the university will not need to resort to extreme measures such as staff reductions, health insurance or retirement benefit cuts, or drawing down the university endowment. However, Langstraat noted that due to pressure from enrollment and the COVID-19 pandemic, “This year, people have the equivalent of a 1 percent raise,” which is far from keeping up with inflation.
Student tuition, housing, and meal plans make up a combined 90 percent of Pacific University’s revenue; of which, according to Phillips, a “fair number” hit their revenue targets, including the Undergraduate, Dental Hygiene, Occupational Therapy, and Physical Therapy programs. Phillips continued, “There are a number of programs that are down a little bit—by 2 percent, 4 percent, something like that. Nothing like Pharmacy.”
With the sudden loss of $2.5 million in revenue, it’s all-hands-on-deck to assess and adapt to the changing landscape of university admissions management.
According to Phillips, the number of pharmacy program applicants nationwide has been on a downward trend for about 13 years. “In the last five years or so, it’s often the undergraduate target that is not hit, and that has to do with demographic changes. . . But this year, we did start to see it in graduate and professional programs. Now, if you pay attention to what I just said—that for the last five years or so we’ve seen it in undergraduate—well what happens five years later? They go to graduate school.”
Pacific’s drop in enrollment isn’t unique. “We’ve checked on other pharmacy programs [at other universities]—they had the same experience,” Phillips reported. “Where you will see increased enrollments are at very elite schools like Harvard and Yale, and then also in the ‘flagship’ public schools. [For example,] the University of Oregon has lots of students, but Portland State University is in trouble. In California, you’ll see the UC system has lots of students, but the Cal State system is in trouble. It tends to be wealthier, whiter schools. During the pandemic, the biggest declines in enrollment were among the non-white student population.”
Competition isn’t only coming from other universities, though. “In the last few years, a lot of ‘mini degrees’ or credentials are being offered by workplaces and companies like Amazon. They’re not university-based degrees, but the appeal of them being cheap and fast is hard to compete with,” Phillips explained, “There’s been just an unbelievable explosion of those sorts of certificates and short-term programs. I think that there will be some reckoning of that in coming years because most of those programs lead to one very specific job where there’s little room for advancement—and they don’t tend to be high paying jobs.”
Pacific University’s PharmD program takes three years, as opposed to more traditional four-year pharmacy programs. Competition from corporate certificate programs likely eroded the attractiveness of a three-year degree. Additionally, rising costs of living and increasing debt aversion on the West Coast mean that working while attending pharmacy school is essential for many students—more feasible in a less condensed four-year program.
The School of Pharmacy will be reorganizing the PharmD program to offer more flexibility to students, including allowing students to attend their first two years of the program at Pacific and complete their third year at home. There will also be an option for taking more than three years to allow students to work and pace themselves.
When asked what Pacific will do to address the cost of the pharmacy program itself, Phillips replied, “We are looking at how we distribute scholarships and financial aid because it is an expensive program.” She noted that Pacific has a “very, very low loan default rate, so we know that our students actually are employed—they pay off their debts.” Even so, the idea of taking on so much debt is intimidating to many.
The Office of Enrollment Management will also be working to speed up the admissions process because, “80 percent of graduate and professional school students go to the first school that admits them,” Phillips said. Langstraat added, “We might have to put more resources into marketing and recruitment than maybe we have in the past.” — Lane Johnson