Gansemer-Topf, A., J. Downey, K. Thompson, and U. Genschel. “Did the Recession Impact Student Success? Relationships between Finances, Staff, and Institutional Type on Retention.” Research in Higher Education 59 (2018): 174–197.
CENTRAL TAKEAWAY
In times of economic uncertainty, Baccalaureate-only, private institutions did not fare well in terms of first-year student retention. Institutions that allocated resources directly toward instruction reported higher retention rates than those that diversified spending across other administrative and academic support services.
SUMMARY
The purpose of this study was to examine retention as a function of a series of economic indicators, including overall revenue per student; tuition revenue per student; gift revenue per student; investment per student; and percentage of expenditures spent on instruction, administrative, grant, and academic support. A host of other variables were also considered, including institution control, selectivity, and type. Findings differed between public and private schools: Given the goals of the Digest for the CIC audience, only results on private institutions will be discussed.
The study used IPEDS data to examine “changes in institutional expenditures, tuition and investment return revenues, staffing, and tuition between 2007 and 2011” (p. 183) as a means of discussing the influence of the recession on student first-year retention. The authors performed a series of robust and appropriate statistical analyses to test their research questions and included theoretically-grounded variables of interest, the most CIC-germane being institutional type (e.g., Baccalaureate-only granting) and control (e.g., private).
These steps allowed for the authors to answer three questions about first-year student retention at private institutions: Did it change over the dates of the recession? Was it influenced by the percentage of institutional expenditures, tuition and investment return revenues, tuition and fees, full- and part-time staffing, selectivity, and institutional type? And was it influenced by expenditures per student, including instruction, administration, and academic support?
DISCUSSION OF THE FINDINGS
The findings suggest that Baccalaureate-only, private institutions struggle with first-year retention during times of economic uncertainty. Private institutions with graduate programs do not—at these institutions, first-year retention rates increased as did enrollments, even if tuition increased in some cases.
Across all the types of expenditures, resources spent on student instruction shared a positive and significant relationship with first-year retention. For example, in 2007, at a private institution, for every $1,000 spent on student instruction, first-year retention rates increased by 0.09 percent regardless of tuition costs per student, selectivity, and type. At these same private institutions, spending on institution and academic support was associated with decreases in predicted retention rates, again across tuition, selectivity, and type.
IMPLICATIONS FOR ACTION BY CAMPUS LEADERS
Instruction matters. Even in the wake of episodic interference, like the recession, spending directly on student instruction helped students enrolled at private Baccalaureate institutions make the decision to persist from the first –to second year of college. Punctuating this finding is that these relationships held, regardless of tuition costs.
Although the data used from this study are somewhat antiquated, results from the study are useful for institutions as they consider moving spending strategies forward through the most recent episodic interference, COVID-19. Although the temptation may be to reduce tuition as the primary strategy toward retaining students, doubling down on instruction may be more effective. Although the quality of instruction experience students received was not measured as part of this study, spending on instruction communicates the values of the institution more than anything else. When faced with competing priorities regarding expenditures, spending directly on student instruction should be considered first.
ABOUT THE AUTHORS
Ann M. Gansemer-Topf is a professor in the Department of Education at Iowa State University.
Jillian Downey is an associate professor in the Department of Mathematics, Computer Science, and Statistics at Gustavus Adolphus College.
Katherine Thompson is a graduate student in the Department of Anthropology at Brown University.
Ulrike Genschel is an associate professor in the Department of Statistics at Iowa State University.
RECOMMENDED FOLLOW-UP LITERATURE
Geiger, R. “Impact of the Financial Crisis on Higher Education in the United States.” International Higher Education 59 (2015). Retrieved from: http://ejournals.bc.edu/ojs/index.php/ihe/article/view/8486
Ryan, J. F. “The Relationship between Institutional Expenditures and Degree Attainment at Baccalaureate Colleges.” Research in Higher Education 45, no. 2 (2004): 97–114.
Turner, S. E. “The impact of the Financial Crisis on Faculty Labor Markets. In C. M. Hoxby & J. R. Brown (Eds.), How the Financial Crisis and Great Recession Affected Higher Education (pp.175–207). Chicago, IL: University of Chicago Press, 2014.