From what I have seen in the past UChicago’s endowment is more conservatively invested than Yale’s or Harvard’s. If I remember correctly its investments were heavy on asset preservation, hence annual returns are usually lower than peers (I actually dont like this strategy because in reality there are more up years than down years in the market… but it will be comparatively less bad for them during this downturn)
Here’s the numbers from back in 2009, the great recession.
Harvard 37 to 26 (30%)
Yale 22.8 to 16.3 (29%)
UChicago 6.6 to 5.1 (23%)
So assuming that the downturn affects all endowments equally based on their level of risk, then UChicago’s ordinal ranking would not be worse… because it would be hit less. It could even potentially move 1 up, above Duke. (but that is not good news, it will still lose a lot of money)
Since tuition accounts for 40% of operating revenue, they will probably shift towards accepting more full pay students. The financial aid budget ($159M) will also probably take a hit.
^ They have already hinted that faculty/staff salaries will take a hit before FA does. This seems to be consistent with what I am hearing from other research uni’s.
Not sure how easy it will be to take on more “full pay students.” Internationals have been a huge source there, and the number of internationals able to matriculate is materially compromised now. Of the domestic students, it appears that increased numbers have just applied for more FA (or perhaps FA for the first time) due to deteriorating income status. That could well have included families who were formerly “full pay.” Will the College be willing to compromise a bit on quality of class just to get a few more “full pay” classes? Their message remains that they are 100% committed to “no barriers” and the generous programs they currently have in place (Odyssey, Empower). So they seem to be doing all they can to preserve the functioning of those programs at least at current levels. That sort of messaging won’t be lost on the applicant pool.
UChicago did actually shift markedly to more “full pay” beginning with the Class of 2020, from what I’ve seen of the historical FA data (note: this was BEFORE they introduced ED). I suspect it had to do with their no-barriers policy, which was introduced a couple years prior, and the corresponding re-allocation from “merit” to “need-based” aid. The % of matriculants taking out student loans also markedly declined at that time. It appears that UChicago stopped giving out merit as generously as they used to, and focused instead on meeting “need.” Over the past few years they have proactively announced efforts to increase Pells and low SES; these efforts, if successful, actually decrease the % of full-pay. They can offset with tuition hikes like they did beginning with Class of '23; while we know tuition+R/B will stay constant next year, not sure what that means about tuition specifically.
JBS, you pose the question, “Will the College be willing to compromise a bit on quality of class just to get a few more “full pay” classes?”
It’s not clear how you are defining the word “quality” but if by quality you mean standard indicators of academic excellence such as GPA/test scores/high school class rigor/competitive academic and non-academic ECs, then I would argue that this definition of “quality” is likely to increase in a quantifiable way with a higher proportion of full pay students, and this conclusion is based on extensive data associations between socioeconomic status and these indicators such as test scores.
Now, if by what you mean by quality is something different, then a different freshman class composition may very well affect those indicators. It’s clear that all highly selective colleges are trying to achieve certain percentages of demographics such as 1st generation, etc. but that is a different institutional goal than quality as defined by academic excellence. This is not an argument whether those institutional goals for diversity among demographic characteristics are good or bad or whether colleges should or should not take socioeconomic disadvantage into account, rather I’m just suggesting that more full pay students is more likely to result in higher test scores (and other academic indicators) for an entering class.
There are plenty of full pay students still left in the US who would give an arm/leg to attend a college like UChicago. Just look at domestic boarding schools: filled with high caliber students, most of whom can pay in full.
There undoubtedly is a correlation between wealthy well-educated parents and the academic quality of their kids as indicated in higher test scores, higher gpa, more strenuous h.s. classes. That’s the principal reason that the representation of high SES kids has been growing at the U of C in recent years. It is a trend that helps with the University’s bottom line and helps to fund FA for less wealthy kids. No doubt it forms the basis of budgetary projections. However, I have never seen any indication that the Admissions Office gives a preference as such to wealthy kids over poor kids. Many hooks directly benefit the latter, as is well known. Some benefit the former, indirectly, as with certain sports, certain EC’s and certain special achievements. For everyone else the preference is clearly for high academic achievers who are the Chicago type.
Let us assume two equivalent candidates on the academic scale, neither having any particular hook, both being stellar. Some on this board appear to be suggesting that in such a case the AO’s will now look at the respective ZIP codes or other indicia of family wealth in order to give the nod to the kid likely to be full-pay.
Doing any such thing would be an egregious violation of the long-standing need-blind admission policy and would surely result in an envelope under the door of the Maroon. For that reason alone I simply can’t imagine it. More importantly, it would simply be inconsistent with Chicago’s educational mission, of which the need-blind admissions policy is a cornerstone.
In such a case it won’t be money but the essays that are the secret sauce - some deft demonstration of an original and adventurous mind, some hint of a love of learning for its own sake, some indication of fit between the applicant and the type of education Chicago offers. Hard to imagine that these idealistic AO’s, some of them not far removed from their own student days, would pass over a demonstration of these qualities in an applicant in order to net someone without them for no better reason than that the latter looks capable of paying the full freight. That would be worse than cynicism - it would be barbarism.
UChicago actually does already accept a good number from the boarding schools and not quite all of them are "full pay" - however, all of them are great admits, and presumably UChicago admits 100% of those prospects who best fit the College's admission criteria (whatever that might be; my understanding is that it bends heavily toward the intellectual, which isn't always the same thing as being a "high-caliber" boarding school student). Therefore, a greater focus on boarding schools at the expense of other sources of "best fit" prospects will compromise the class even if it does increase tuition revenues. This might seem counter-intuitive, but "full-pay" is actually a constraint on the admission decision. Schools want to be able to admit "the best" from whatever sources produce them without any constraints.
UChicago already has the 2nd highest test scores (1st place goes to Cal Tech). So they needn't worry about improvements there. And it's been mentioned on other threads that EC's in general don't actually REQUIRE a lot of income (although certain ones clearly do).
In general, Zoom, you are correct that the standard indicators increase with income but, as we've seen the past few years, a whole lot of those top-ranked standard indicators are waitlisted or rejected outright in favor of more modest accomplishments, both from the privileged and non-privileged alike. The distribution that UChicago seems most concerned with isn't based on income so much as a set of internal characteristics: degree of intellectual curiosity or inquisitiveness. Those, of course, will be highly correlated with GPA and EC's and less so with test scores.
Predictive analytics and revenue management is an interesting trend in college admissions. This NY Times article explains the issue quite well. It describes how Trinity College in CT uses econometric modeling to find the right balance of students to hit revenue targets.
That is a good article, Angel Perez is the incoming president of NACAC too, which is great.
WRT predictive analytics models, they have been in use for more than a decade and are generally highly accurate in determining yield…with the exception of this year (at least at many schools)!
For example, a common variable in some schools’ models includes distance an applicant traveled to visit. As we know this year, many students are making the choice to attend a college closer to home.
More than 1/2 of NACAC member schools still have freshman and transfer openings, and when schools announce their Fall plans, it’s likely that some proportion of current students will take leaves at schools that go remote only…someone just reported on another thread that Williams did a survey of current students and 70% said they will take a leave if Williams is remote only.
Of course, those Williams students may choose differently when push comes to shove…but both Bowdoin and Amherst have said they will grant an unlimited number of leaves for current students, not sure U Chicago has said anything about this.
Bottom line there will probably be a lot of movement and opportunity this summer for both transfers and freshman because schools still need adequate revenue levels.
I think the assumption that the admits from NE boarding schools are full pay has to be examined. I’m pretty sure that Exeter and Andover are the the two boarding schools that send the most kids to Chicago. Half the students at both those schools are on financial aid.
Whatever remodeling of admissions toward full-payers may be happening elsewhere, it won’t happen at Chicago. The NYTimes piece is blocked by a paywall, but I suspect it mainly applies to schools of lesser endowment and lesser appeal. At Chicago quite substantial funds are set aside for FA, and need-blind admissions has always been fundamental to the mission of the school. The devoted funds will need to be supplemented by surpluses created by full-payers. That too has always been the case, though in the not distant past far fewer full-payers were seeking admittance. Nowadays the appeal of the College naturally attracts many more of them. As @zoom10 and others have pointed out, those kids will be quite competitive for seats without any necessity of fudging admissions standards or putting a thumb on the scales to help them.
I hypothesized at #27 a choice between two academically equal students, and I asked whether anyone suggests that in such a case Chicago AOs will deviate from stated principle and unmask and tap for admission the kid they have reason to believe would be full pay as against the kid they have reason to believe will require FA. So far no one here says so. To me it seems most improbable. What seems less improbable is that these outcomes and projections go into the hopper for budgetary purposes. But so what?
In my son’s graduating class at Lawrenceville, there were about 10 students who were accepted to UChicago. I think 7-8 decided to matriculate. Of that I am aware of only one student who needed financial aid. This is obviously a small sample to extrapolate from. But I highly doubt that half of the matriculants from Andover/Exeter would need FA at UChicago.
When tuition makes up 40% of operating revenue, even at a place like UChicago, they will have to meet their revenue targets. No doubt that the predictive modeling is churning away right now in Hyde Park. Trying to find the optimal blend of students to accept off the waitlist to fill the bottom line.
Marlowe, in a previous post on a different thread, I made the argument that need-blind admissions is a myth even at super wealthy schools like the Ivy Plus because each of these schools has both a financial aid target and a tuition/room & board target that is set each year by the Board/President/Provost and given to the Admissions office to hit. The Admissions office happily admits kids who need FA up to its set FA budget while also ensuring that it admits the right number of pull-pay students and others to hit its tuition budget which is also fixed. None of these schools including Harvard with its endowment has a target tuition budget that is $0. In fact, most of these schools have a target tuition/room & board budget of at least 40-50% of its incoming class.
So to answer your question, would a college take a full-pay student over an equally deserving FA kid in order to meet its tuition budget requirement and not exceed its FA budget, the answer is emphatically Yes and to do so otherwise would be financially irresponsible and grounds for firing which I guarantee Nondorf and his peers will avoid at all costs.
Now, these budgets were set at the beginning of each academic year well before Covid. Given the unexpected economic crisis brought on by Covid and the deficits/freezes/reductions faced by all colleges, even the wealthiest, I am quite confident that next year’s FA budget will also be adjusted (downward) and even this year’s FA budget is no longer immune to being adjusted. Again, to simply say that FA budgets should remain fixed when every other facet of the university is subject to cuts flies in the face of reality. Therefore, I am quite certain that ALL colleges, including the wealthiest, will be seeking to admit more full-pay students even though that is not something they will publicly admit but when have colleges been truly transparent about anything?