Tuesday, December 09, 2008

Does Eva Pell Have Her Head in the Sand?

What impact will the current economic crisis  have on graduate student enrollment at Penn State? That was the question addressed in a Collegian article this morning.
Though Smeal College of Business has seen a 22 percent surge in applications in the last academic year, overall graduate applications have not increased at the university, said Eva Pell, vice president for research and dean of the Graduate School.

Despite the survey's findings, Pell said the number of applicants reflects a decision made by students a year ago, and thus does not necessarily reflect the current state of the economy.

"I am guessing that a better test of the hypothesis will come when we see what applications look like this January when the bulk of applications arrive for 2009-10," she said.

So Pell doesn't think the overall  flat enrollment is an indications of anything. I, on the other hand, think that the flat enrollment is already an indicator that something is amiss.

The country has been in a recession since December of 2007 so its impact on enrollment should already start to have been felt. Historically graduate school enrollment is counter cyclical.
On the one hand, they are somewhat buffered by an almost guaranteed set of customers: unless the economy melts down catastrophically, a new crop of undergraduates will show up every year. And the science- and technology-related graduate schools might even flourish. US National Science Foundation data show that enrolments have typically gone up (see Trends in employment and graduate enrolment) during previous economic downturns, when the forbiddingly tight job market led students to continue their education, or caused laid-off older workers to go back to school.
Consequently, one would expect to have seen a bit of a boost in Penn State's numbers which has not been seen.

Further, a leading indicator of grad school enrollment, the number of people taking the GRE, is down for the first time in years. Which suggests that the counter cyclical trend may not care through this time.

Debra W. Stewart, president of the Council of Graduate Schools, said she too was surprised by the data. “We’re in the worst financial crisis, so you would think applications would be soaring,” she said. The council does annual surveys on application and enrollment trends, but they will come later in the admissions cycle. Stewart said that the organization has done some informal polling of members on the group’s listserv and is finding “a mixed picture,” with only some institutions reporting declines. But of those not reporting declines, they are reporting “an average year,” not the kind of application year one would expect with an economic crisis.

Stewart has several theories about why declines may be taking place this year, despite historic trends. She said it was possible, as ETS officials suggested, that the credit crunch was making it more difficult for students to borrow — or that hearing about the crunch discouraged some from trying. In that same vein, she said that with many colleges and universities announcing budget cuts, many departments may not have the same levels of funds to offer in fellowship support.

In addition, she said that while economic uncertainty in the past has prompted some people to decide to improve their skills so they can seek better jobs, the turmoil is so great this year that “no one will leave a job if they have a job — they think the risk is too much to take.”

Stewart also stressed that just because the surge in interest in graduate school has not happened this year doesn’t mean it won’t start. Many people these days are experiencing “freezing behavior” where they are so uncertain about their next move and the state of the economy that they aren’t making any changes, she noted. “It could be that this has created a temporary pause where we would have normally seen a flow to graduate school. That the flow hasn’t started doesn’t mean it won’t.”

And by the way,  the number of people taking the GMAT is up which is consistent with the B-schools bump in enrollment.

This does not look good.

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1 comment:

Sarah said...

According to a recent presentation to the BoT, graduate enrollments across the university are up slightly. Application numbers, as discussed in the Collegian article, are not the same thing, though of course they are closely related. Interestingly, resident graduate enrollment is down slightly, but enrollment has increased overall due to graduate students studying online at a distance - which makes sense to me, because if you have a stable job and can keep it while studying toward a graduate degree, in this economy, I'd think that's the best of both worlds.