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Case Study: Economic Crisis and Higher Education in the United States
The 2008–2012 economic failure is considered by many economists and investors to be the worst financial crisis since the Great Depression of the 1930s. It results in the risk of total collapse from big financial firms, the bailout of banks by national governments, and downturns in stock markets around the world. The crisis also plays a significant role in the crash of key businesses and collapse of housing market, results in the delayed unemployment. Higher education is a large and various venture in the United States, which has impacted by the economic recession in a number of ways, but these impacts have not been the same and vary depending on state and type of institution.
Most higher education traditions started to be concerned about their financial problems due to economic recession. Their main source of revenue has been hurt by the downturn, and that those universities would need to make hard decisions about how to spend their money. In some states, a lot of institutions are in process of fund-raising programs to avoid delaying their supported campus building projects. Many of higher education university’s leaders have been considering and solving of two following questions: How is the economic downturn affecting institutions both public and private? What strategies are leaders implementing to guide their institutions?
Unsuccessful budget strategies are the main reason that caused many institutions’ problems. Their top managers have not effectively managed their money. Fund-raising, government support, and earned income will also suffer in a poor economy. They are also experiencing revenue deficits due to lower state appropriations, endowment losses, or a reduction in donation. Furthermore, institutions' difficulties in gaining access to funds invested in a major short-term investment fund.
According to Ken Chabotar, author of The Economy and Higher Education, budget

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