Colleges face a new financial hurdle: Employers are dropping degree requirements for potential hires.
Colleges are struggling with unprecedented pressure to maintain enrollment numbers. A tight labor market and persistent inflation have strained the already inefficient legacy payment system that weighs on many colleges.
And there is a new challenge as reported The Wall Street Journal. Large corporations and states looking to fill public sector positions consider four-year degrees as employment qualifications. Although bachelor’s degree holders earn, on average, more over their lifetime than high school seniors ($2.8 million vs. $1.6 million), student loan debt is an ongoing challenge for many borrowers worried about their ability to repay these loans.
A November report by PYMNTS and American Express describe the rising tuition and boarding school fees over the last ten years. These dramatic increases can pose problems for some prospective students (and their parents, who fund these degrees). This is a particularly timely concern considering the cost of living fuels 60% of Americans due to inflation salary to salary.
A common pain point for colleges is their reliance on legacy payment systems that cannot meet modern institutional needs. Other challenges cited in the PYMNTS survey were the inability to process recurring payments and the length of time it took to receive payments. Seventy-two percent of school financers consider their payment processes to be only somewhat or marginally effective, using on average nearly 3% of college budgets. Actual costs could be higher when factoring in employee time fixing errors and filing paperwork.
This need for change creates an opportunity for colleges and universities and may consider digital payment platforms as a solution. Cost reduction measures applied to legacy payment systems may open up the opportunity to pass these savings on to students through reduced fees. Solving one of the issues related to legacy payment systems may not provide enough cost reduction to significantly offset tuition, but solving several legacy payment issues could make a significant difference. If outdated payment systems are not modernized, it could cost schools much more than the administrative burden. Even a slight drop in enrollment could spell exponential problems for colleges in this competitive market.
Many institutions lack the infrastructure to implement these changes, but there is good news: colleges interested in reducing costs by adopting digital platforms can work with companies to transform their payment operations through strategies such as ID card innovation and Consolidate all-in-one platforms. For schools with multiple siled payment platforms handling different areas such as classroom, hospitality, and bookstores, this consolidation would streamline operations and simplify compliance and security.
Using digital payment platforms doesn’t have to be an all-or-nothing effort. Adoption can begin as a small introduction to the school’s broader payment system, e.g. B. tracking cafeteria payments, and then proceed with related activities. These incremental digital upgrades to campus operations can provide students with the consistent payments experience they desire—while helping to boost enrollment in an inflationary economy.