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One of the pleasures of the winter holidays is the time it affords to read materials other than the obligatory academic journals and students’ term papers. This year, like every year, most major magazines I caught up with published a review of 2010. I avoid reading those reviews because I already experienced those events (I did not like them much then!).

The major magazines also attempt to forecast the more salient issues of 2011 and some of their guesses are pretty good while others are pretty ridiculous. If they can do that, fearing no shame, why can’t I?

So what is the Tao of 2011? Chinese astrology tells us that on February 3, 2011 the Year of the Rabbit will begin. The I Ching says that in “the year of the Rabbit without concentration you will fail.” So watch what you are doing, focus on your intent, don’t go looking both ways, except when crossing a street.

Heeding the rabbit’s caution and remembering Yogi Berra’s uncertainty about predictions and, because my business is higher education, I thought I would suggest ten events that are likely to have a significant effect upon higher education in the United States in 2011. Here it goes.

Number One: Early in 2011 cities and states that are broke now, operating with deficits, and projecting deficits through 2012, will begin to either default or furiously renegotiate their outstanding bonds. Because colleges and universities that borrow do so with tax-free bonds under the authority of their state, their bonds’ perceived risk will be lumped with the “municipals” and it will cost substantially more to borrow money for anything. At the same time, state’s contribution to higher education is expected to decline, precisely when demand from 18-24 year olds is projected to grow sharply (fueled in part by the nature of this recovery). This will exacerbate the financial issues already being faced by the whole of higher education, from decreased state contributions for public universities, to tapped-out Federal pools for loans and new requirements for additional reserves for private universities. This will lead to a new musical hit, maybe a country western or blues or more rightly a rap, on how being a CFO of a college or university in 2011 “ain’t nothing but pain.”

Number Two: In 2011, the Feds will continue their attempt to push the Capitalized Universities (CUs) further away from the educational trough. The Federal case has been weakened by the revelations that the GAO study which gave it impetus did not live up to its title: “FOR-PROFIT COLLEGES Undercover Testing Finds Colleges Encouraged Fraud and Engaged in Deceptive and Questionable Marketing Practices.” The GAO was forced to send corrections on critical data presented to Congress. Nonetheless, a series of changes in government regulations applying mainly or only to CUs and new legislation now in Congress, will move forward to limit the use of CUs business model for attracting students. The Feds will hurt CUs in the short term with lower sales and lower profits, but this will only serve to make the CUs a stronger competitor and cause it to move into more of the Traditional Universities’ (TUs) traditional areas. The CUs will successfully adapt, the TUs will need another strategy.

Number Three: Some universities will have no choice but to raise tuition and students will respond adversely to those attempts. For universities, the cost of tuition has been a proxy for quality, i. e., the higher the tuition the better the college is perceived. This has worked to their advantage as they tried to maintain services while costs rose and state contributions declined. But for students and other payers, higher tuition means higher debt burdens. I predict that this year students will react like their European counterparts and provide political pushback. (See Hell No We Won’t Go and Off with their heads.)

Number Five: An aging faculty and administrative staff will bring about a wave of retirements this year. Most of us are running on super lean staffs so the retirements will require new hires (projected at 15-18 percent) however budgets will constrain replacing all vacancies. Will universities know how to reallocate funds for new hires so as to reflect their strategic objectives? I don’t think most will or can. Lack of a robust faculty pipeline, particularly in areas of high need, such as health professions, engineering, basic sciences, will push starting salaries up? 15-20 percent for faculty and 20-25 percent for administrative roles. This will be partially ameliorated by a willingness for faculty who could retire, to remain on the job

Number Six: Some major universities will begin to use Bologna processes successfully. The Tuning Process will expand and be supported by regional accreditation agencies. The 3-year baccalaureate will be proposed and will become available from traditional state universities, just to overcome increases in “time to completion” which has the average student taking 5-plus years to complete a baccalaureate in the U.S. today. (See here)

Number Seven: While somewhat attenuated by the tight financial picture, this will be the year for venturing abroad.  A campus abroad will be initiated by dozens of universities and expanded for those already present.. Data will drive the movement. India will require an additional 5 million professional degreed people in 2012. China will add 7 million to the demand by 2013. But here at home, by the year 2020, President Obama wants us to produce 23 million more graduates than we are producing now. Most attempts will not succeed and will distract from the main business of a TU in the United States. Heed the caution of the rabbit and remember that “without concentration you will fail” (Look up my thoughts on global strategy, part 1, 2 and 3)

Number Eight: We will require a massive improvement in productivity, in order to meet our own need in the U.S., and this is not likely to happen this year. When budgets go south, CU’s cut back and get more done with fewer people. TUs can do that only to a very limited extent. They can restructure programs, close some, open others, make them leaner, faster, delivered through media. Nearly all universities will attempt to increase productivity, but their level will remain stubbornly at that of the 1950’s when no one had ever heard of a computer.

Number Nine: Regional accrediting bodies and other regulators will tighten their reviews to meet social pressure to show outcomes. “Quality”, now a noun, will become a verb. As it was in the 70’s that the noun “impact” became the verb[1] “impacting.” talking about quality in higher education will become so commonplace that “quality” the noun will metamorphise. But what will the new word be? Quality-ing?

Number ten: Seven of the ten predictions above will unfold just as I predict. Three will not. At this time, I can’t tell which will be which, but a predicted .700 batting average ain’t bad.

[1] Technically a Gerund (Verbal Noun)