Director: Daniel C. Levy

Financial Problems Plague Japanese Private Institutions

(Summary by Yingying Xu)

PROPHE Summary:
Many Japanese private institutions, including half the junior colleges (which cater heavily to women), have lost money in the last two years. Causes include decreasing overall enrollments stemming from a falling birth rate, economic recession, and an increase in the number of new institutions. Some of the troubled private institutions have had to shut down. Others pursue policy to avoid this fate. Cost cutting falls heavily on staff. Measures to make institutions more attractive often center on attracting nontraditional students--businesspeople, homemakers, and retirees.

For the full story (shown with permission) see the Chronicle of Higher Education, February 14, 2003, "Japan's Private Universities Awash in Red Ink," by Alan Brender.
http://chronicle.com/free/v49/i23/23a04101.htm

PROPHE Observation:
The financial crisis of Japan's private higher education is internationally noteworthy for several reasons. One is that Japan has by far the highest private share of enrollments in the developed world. Another reason is that current events show the special vulnerability of private institutions, notably tuition-driven ones, to economic downturns. And a third reason is that Japan dramatizes the difficulties confronting private institutions when the principal pertinent age cohort shrinks and overall higher education enrollment falls. Private higher education worldwide has proliferated during the recent decades of population growth but especially in relatively developed regions, such as Eastern and Central Europe, the demographic context is changing.