From unique hurdles for New England institutions, to enrollment crises on the international and domestic fronts, to preexisting existential challenges, coronavirus may spell the end for some colleges and universities.

Coronavirus is upending the Massachusetts economy, creating widespread unemployment and forcing many businesses and institutions to question traditional employment models. One sector particularly hard hit is higher education, as colleges struggle with loss of income, continued expenses, and decreases in student retention and enrollments.

On April 7, Moody’s Investors Service predicted widespread instability in the higher education sector as a result of the new coronavirus. However, grim financial realities and questions of survival are not new for Massachusetts colleges. Before coronavirus, higher education institutions faced a shrinking domestic student market and ever-increasing expenses. Add to that anemic international recruitment, and many colleges were experiencing a multilateral crisis of identity, mission, and balance sheet well before coronavirus. The pandemic has exacerbated these problems, causing many higher education institutions in Mass to face hard and existential choices in the very near future, if not already.

In March 2019, Moody’s downgraded its outlook for higher education from stable to negative for the second straight year. Roughly 30% of both public and private colleges that Moody’s tracks were running operating deficits while over 30% were projected to experience at least a 3% decrease in cash flow and investments. In other words, colleges were in financial trouble before coronavirus. Over the past four years, Massachusetts has seen eight colleges shut down or merge with larger institutions, including Wheelock College that became a new school within Boston University.

In April 2018, Mt. Ida shocked the public by announcing an imminent closure, terminating staff and putting close to 1,000 students on the streets. A last-minute purchase by University of Massachusetts Amherst saved Mt. Ida from bankruptcy and provided students with a potential new academic home. When the dust settled, investigations pointed to two catalysts in Mt. Ida’s closure: significant deferred maintenance costs; and half of the 2012 freshman class not returning for sophomore year. Mt. Ida, a tuition-dependent institution, never recovered that retention loss.

These closures demonstrate a trend in Massachusetts colleges—too much capacity and not enough demand. Carlton’s Professor Nathan Grawe, who studies demographics and higher education, found that Massachusetts colleges will face a potential enrollment decline of at least 15% between 2012-2029, with rural colleges experiencing potential declines up to 29%. The reason behind these enrollment woes lies in the last financial crisis.

From 2007-2009, the total fertility rate in the US, or number of children a woman will have in her life, fell by 9%. As the economy recovered, though, the birth rate continued to slide so that by 2017, fertility was about 17% lower than the pre-crisis peak. In other words, we are not replacing our population—starting in 2026, there will be a sharp decrease in high school seniors. The Massachusetts colleges will be hit particularly hard, as the state’s birth rate is among the lowest in the country. That will force colleges to attract more out-of-state students, and the data adds insult to injury for Mass colleges. The only group that has increased its birth rate is the Hispanic community; a historically tight-knit and family-focused culture, Hispanic seniors often favor colleges closer to home. Given that only 2.9% of America’s Hispanic population lives in the Northeast, that is not good news for Mass schools.

To clarify, prestigious universities such as Harvard and MIT, or ones with endowments on par with the GDPs of small countries, were immune to demographic changes. However, the smaller, lower ranking schools—that is, the majority of higher education institutions in New England—have faced a very different reality.

Boston is home to 35 of Mass’ 114 colleges. With 152,000 students attending institutions of higher learning, Boston comprises 34% of the state’s college enrollment. Education is one of the Hub’s main sectors and accounts for more than 165,000 jobs and nearly $11 billion in revenue in the metro region, according to data from Emsi, a labor-market data firm. But even those figures underestimate its importance to the economy. Higher education is the foundation that supports bigger Boston’s industries, including healthcare and technology. Around half of graduates stay in the area, becoming a workforce and tax base. It is truly the only industry whose customers turn into residents.

These demographic shifts were a financial reality for Boston and its colleges well before coronavirus. According to David Strauss, Principal at the Art & Science Group and a higher-ed strategic consultant, size does not equate with survival. “Look at women’s colleges,” Strauss noted on a recent call. “There used to be 281 and now there are 34.” So, it is not only the Mt. Idas that are at risk—schools with pedigree, history, and extensive alumnae networks also faced the coming demographic emergency. Radcliffe comes to mind.

Some colleges have found a model that allows them to survive amidst the changing economy of higher ed. In Strauss’ experience, institutions whose leadership strategically focus time and resources on developing a market niche are not only surviving but thriving. A recent Boston success story is Simmons College.

In 2008, Helen Drinan, a former banking executive, became President of Simmons and immediately implemented reforms to create financial solvency and sustainability. She found that undergraduate programs on their own are barely viable, while graduate programs have less overhead and attract working professionals who are more willing to pay full tuition and don’t require food and housing. The problem was that there weren’t enough potential graduate students in New England. So, she took the programs online. After receiving fierce pushback from the school community, the numbers proved her reforms right. By 2018, the online courses were producing $26 million in net annual revenue.

For mission-driven organizations, it is often difficult to convince boards and senior leadership to focus on the bottom line and start profiting. “At the end of the day, it is not about making lots of money,” Strauss said. “It is about having control over your mission. You need money for that.”

Another example of creative restructuring is Michael Alexander, who became president of Newton’s Lasell College in 2007. After setting a goal of delivering an undergraduate education for 30 to 50% less than the typical price, Alexander launched a program called Lasell Works, a novel hybrid of traditional and online education. Students spend their sophomore year living off-campus, working part time, and taking all of their courses online. The savings amounts to a $22,000 reduction in total tuition.

If colleges were in trouble before, coronavirus will push many over a cliff and has already done so. In an interview with Chronicle of Higher Education, Bob Zemsky, a University of Pennsylvania Professor and co-author of The College Stress Test, noted 20% of all colleges are facing unprecedented levels of financial stress. One of the greatest concerns is how the virus will impact institutions’ retention and enrollment yields.

Early studies show that coronavirus has hastened Grawe’s projected demographic shifts—as the virus spreads, more students want to stay closer to home. A new student poll conducted in late March by Arts & Sciences Group LLC showed that one-in-six students who were intending to go to a four-year college in Fall 2020 are giving up on attending, while two-thirds of high school seniors are thinking about changing their first-choice school. The poll indicated that many students are thinking about taking a gap year, attending part-time, and/or going to a school close to home. In addition, the American Council on Education, which represents 1,700 colleges and universities, reports at least a 20% increase in students who need financial aid as a result of job loss or other related coronavirus impacts. That could worsen, depending on the pandemic’s duration.

If the domestic student market realities are worrisome for Mass colleges, the international scene is cause for great alarm. Before coronavirus, the Institute of International Education reported that new enrollment of international students in the US had declined by more than 10% between the 2015-2016 and 2018-2019 academic years. Boston is the fourth most popular US college city for international students, and a decline in this community, and its tuition dollars, would compound the domestic enrollment crisis. At the same time, Chinese students, who comprise 33% of the international student body in Massachusetts schools, are becoming a significant presence on Australian campuses. Enrollment of international students in Canada and Australia has skyrocketed, with the latter reporting a 47% increase between 2015 and 2018.

International students are sought not only for tuition dollars—most pay full—but for what they bring to an economy. In 2018, an estimated 75,000 international students attended school in the Greater Boston area, of which 48% came from China and India, and contributed more than $3 billion to the Mass economy. In February, the Beijing Overseas Study Services Association (BOSSA) reported that an estimated 36% of students are changing their plans to study abroad due to coronavirus. In addition, the epidemic has caused 40-60% of Chinese students to be directly blocked in college applications and visa applications. For instance, the February and March cancellations of all standardized entrance exams in China impacted up to 40% of new enrollment for Fall 2020. While BOSSA reported that students are not cancelling plans to study abroad, many are deferring for a year due to the epidemic’s spread. Additionally, early polls of international students indicate a 15-20% increase in need for financial aid among current and potential international students—similar to domestic students.

More financial aid is not something most Boston colleges will be able to provide. Those colleges operating with a deficit, 30% per Moody’s, will have difficulty weathering the revenue losses from the spring and coming summer. In addition, the spread of coronavirus and its impacts on the economy will make fundraising difficult. Another key element for monitoring college financial health is how endowments are doing, as investment income comprises up 9% of revenue at private universities and 2.5% at public institutions. Since the coronavirus pandemic hit America, the stock market has yet to stabilize.

Additionally, city, state, and federal government budgets are strained and will have less discretionary funds to support higher education. The federal funds from the Coronavirus Aid, Relief, and Economic Security (CARES) Act allotted $14 billion to support higher education, of which Mass colleges will receive $280 million. According to Ted Mitchell, president of the American Council of Education, this amount is “woefully inadequate” to replace the $46.6 billion colleges are projected to lose due to coronavirus.

Before the pandemic, Grawe predicted Boston could expect a 10 to 15% reduction in higher ed’s 165,000 jobs simply due to demographic changes. Every higher education job in Boston creates 0.7 jobs in other economic sectors, which translates to a loss of at least 28,000 jobs. These job losses equate to an estimated loss of $1.7 billion in direct economic activity, and a loss of $112 million in tax revenue. With colleges reeling from coronavirus, the long-term job loss and real impacts on Boston’s economy are unknown—but the above numbers may be a baseline.

This is a harsh reality. If colleges are to survive, Strauss recommends they think beyond the immediate crisis of 2020 and immediately realign their mission and programs to be sustainable in the long-term. Colleges were facing existential challenges before coronavirus and some, such as Lasell and Simmons, learned how to strategically adapt and thrive. These institutions may offer lessons learned and real-world models for colleges who still have the resources and flexibility to change.

This article was produced in collaboration with the Boston Institute for Nonprofit Journalism as part of its Pandemic Democracy Project.