According to InsideHigherEd.com, a report released by Moody's, Converging Forces Will Squeeze Budgets for Many Colleges and Universities, projects institutional expenses will skyrocket in the 2022-2023 academic year due to wage inflation, labor shortages, and a nationwide hiring push. Budgets will be further impacted by increasing costs for goods and services coupled with decreasing federal pandemic aid as a key revenue source.
A second report, Macroeconomic Factors Will Influence Fall Enrollment Levels and Revenue Growth, warns that a strong labor market and rising inflation will have a negative impact on college enrollments and revenues. Plentiful jobs and high inflation will entice students, who might otherwise attend college, to enter and remain in the workforce. Higher prices for food, housing, gas, transportation, and other necessities reduces the amount of income that can be allocated for education.