Soaring Financial Aid & Competition for Students Increasing Pressure in Higher Ed

As college recruiters scramble to keep up enrollment numbers, financial aid has become the chief competitive tool. In fact, an annual study last year by the National Association of College and University Business Officers found the average institutional discount rate for first-time, full-time freshmen in private schools reached 48.6 percent.

What factors have led to this trend? The Washington Post has recently highlighted changing demographics that are putting pressure on college recruiting. Higher education writer Jeffrey Selingo points to a “lack of a strategy to diversify the enrollment pipeline.” Since many colleges have not been prepared for the changes, the urgent reaction has been to offer substantial discounts.

In a subsequent article, Selingo identifies regions of the country—particularly the Northeast and the Midwest—where declining high school populations leave colleges at particular risk for enrollment wars. To attract students from farther away, increased financial aid becomes even more critical.

At the same time, cost is still a major barrier for students. According to a recent Inside Higher Ed article, “about 40 percent of students who decided not to go to their college or university of first choice cited reasons related to costs.”

How can recruiters take steps to compete in this high-pressure environment? We have a few suggestions to get you thinking . . .

First, build your pipeline to diverse audiences. Since 40% of today’s college population is made up of minority groups, this is a substantial factor in your enrollment plans. Financial aid is important, but there’s still much more. See insights here on Engaging Today’s Growing Minority Population. Further, there are now more than 1 million international students on U.S. campuses. See more here on Attracting International Students.

Next, when evaluating your financial aid system, look beyond the amounts and types of aid. Consider: how well are you delivering your service? Are you providing information and award packages quickly enough? Is your presentation clear enough that students understand any unique benefits you’re offering? Do your marketing materials showcase all that you have to offer prospective students?

We realize you’re thinking about how to communicate more effectively in the crazy complexities of today’s financial aid environment. We are, too. Let’s talk.


Selingo, Jeffrey. The Washington Post. “Small colleges fight to survive, amid warnings of shaky finances.” February 9, 2017.

Selingo, Jeffrey. The Washington Post. “How much longer will students be willing to go away to college?” March 25, 2017.

Seltzer, Rick. Inside Higher Ed. “Turning Down Top Choices.” March 23, 2017.

National Association of College and University Business Officers. “Tuition Discounts at Private Colleges Continue to Climb.” March 16, 2016.