Moody’s Investors Service is predicting a diminishing net tuition revenue growth for both private and public universities in the country during the 2020 fiscal year.
Revealed in its tenth annual tuition revenue survey, the report attributed a decrease in net tuition revenue growth to flat enrollment, a focus on affordability and increasing tuition discounting.
The revenue growth for public universities is projected to fall to 1 percent from 1.5 percent in 2019, while for private universities the revenue will fall to 2.3 percent from 2.8 percent in fiscal 2019.
At least 27 percent of public universities are expected to see net tuition revenue per student decline, with smaller institutions having the largest declines during the next fiscal.
With college affordability driving the pricing decisions and many states limiting the tuition hike and some placing tuition freezes is also affecting the tuition revenue growth.
“Overall enrollment is steady, but net tuition revenue growth at US universities is relatively low,” said Moody’s analyst, Patrick McCabe.
“This reflects demographic pressures within the higher education sector that have increased competition for students, as well as declining international student enrollment and flat graduate enrollment.”
Similarly, among the private universities, the smaller ones are predicted to face the maximum burnt with the growth of 1.1 percent, compared to 1.9 percent.