Credit Rating Agencies Split on Higher Ed Outlook in 2024

Two credit rating agencies are somewhat divided in their outlooks for U.S. higher education in 2024, with one arguing the sector has stabilized, while the other forecasts tough economic conditions for less selective, regional colleges. Revenue growth from sources like tuition and state funding looks promising, Moody’s Investors Service argued in an analysis Thursday. S&P Global Ratings, however, said Thursday that only highly selective institutions will enjoy student demand and healthy balance sheets. Their less selective counterparts face enrollment declines and credit pressures in turn, S&P said. Both organizations agreed that labor shortages and similar challenges will squeeze colleges next year.