Stay up to date on life and culture in St. Louis.
Webster University is facing financial pressure from lagging enrollment and debt that is outpacing profit.
WEBSTER GROVES — For nearly a decade, Webster University has seen enrollment decline by thousands of students and debt rise by the tens of millions of dollars.
The private college, located at Big Bend Boulevard and Edgar Road, faces a precarious future, one that analysts have little faith will improve any time soon, as annual losses reach $25 million.
And Webster’s bet on pivoting from being an arts-focused institution to one catering to business, technology and health sciences — leading it to take out over $60 million in bonds to construct new high-tech buildings at its main campus here — has yet to pay off.
The $44 million Browning Hall, center left, opened in 2017 at Webster University in Webster Groves, as seen Thursday, Jan. 26, 2023. The private school, once focused on the arts, built the interdisciplinary science building which features 27 laboratories to boost its health sciences offerings.
School leaders say they have a turnaround strategy, largely focused on attracting more international and online students, that is showing signs of working.
“I have always been optimistic and positive about Webster’s mission and vision and our ability to adapt to often challenging circumstances,” Chancellor Beth Stroble said. “We are clearly doing what we need to do to ensure that optimism is rewarded with results.”
The more than century-old university is one of the St. Louis region’s most prominent; its alumni have gone on to become Tony Award nominees and esteemed musicians. Now, as Webster University has further branched into online courses, it offers degrees and certificate programs in everything from cyber security to gerontology to teaching English as a second language to piano performance.
Webster University assistant professor Nicholas Curdt, right, leads nurse anesthetist students, from left, Kendra Davis, Angela Keilholz and Mackenzie Lee in a virtual autopsy during a class in Browning Hall on the Webster University Campus in Webster Groves on Monday, April 25, 2022. Webster University will launch the new College of Science and Health on June 1, they recently constructed a new interdisciplinary science building designed for the science and health programs. Photo by Colter Peterson, cpeterson@post-dispatch.com
Stroble has led Webster’s building boom over the past decade, when it opened a new $44 million health sciences building, $28 million business school building and $12 million parking garage at its main campus here.
Since coming to Webster in 2009, Stroble has also expanded the university’s presence locally, opening a campus in downtown St. Louis, and adding to dozens of satellite campuses in the U.S. and the world, including Ghana and Uzbekistan.
Yet in recent years, the college has failed to attract enough students to offset expenses, despite raising tuition. An increase in international students has boosted enrollment system-wide for the upcoming school year following a significant drop. Over a six-year period from 2015 to 2021, Webster’s enrollment declined 42% from a little over 17,000 students to 10,000, according to university audits and bond documents.
Tuition also rose 17% over the same period, from $25,300 to $29,640 per academic year. Tuition will surpass $30,000 at Webster next fall.
Yet, despite tuition increases, revenue plummeted from $186.7 million in 2016 to $133.6 million in fiscal 2021. During the same period, the university’s losses continued to spiral from $12.8 million to $24.5 million, financial filings show.
Webster University assistant professor Nicholas Curdt demonstrates the abilities of the mock surgical room in Browning Hall on the Webster University Campus in Webster Groves on Monday, April 25, 2022. By 2027, university officials aim to have enrolled 1,750 in the health science fields, comprising more than half the university’s 3,000 students in St. Louis.
The financial losses prompted credit rating agency Moody’s to downgrade the university in 2021, stating that Webster was facing a rapidly changing competitive environment.
Moody’s again downgraded Webster to a “negative outlook” in December 2022, driven by what the agency said reflected “the magnitude of its recent financial deterioration that will be difficult to reverse.”
Last summer, Forbes graded private colleges on their financial health from the start of the pandemic based on endowments, debt and operating margins. No university in Missouri scored better than a C+, with the exception of Washington University’s A+. Webster earned a C-.
Other private colleges here are facing similar financial pressures, but not of the same magnitude as Webster.
Fontbonne University, which has one campus in Clayton, has seen enrollment drop below 1,000 in the past couple years. Its expenses have continued to outpace revenue, though they have improved from a loss of $5 million in the 2015-2016 academic year, according to the latest available financial filings.
From left, nurse anesthetist students Mackenzie Lee, Kendra Davis and Angela Keilholz set up an ultrasound machine during a class in Browning Hall on the Webster University Campus in Webster Groves on Monday, April 25, 2022.
St. Charles-based Lindenwood University has seen expenses rise and fall over the years: It reported a $24.3 million profit in the 2017-2018 school year, only to see expenses outpace revenue for the next two years.
Stroble was promoted from president to chancellor in 2019, when she earned $799,176 in salary and bonuses — making her among the highest paid university leaders in the St. Louis region.
Of similar-sized competitors, University of Missouri-St. Louis Chancellor Kristin Sobolik made $325,000 and Lindenwood President John Porter made $228,477 in the 2019-2020 school year, according to the latest available financial information.
Financial analysts, including S&P and Fitch Ratings, have warned that less selective private universities that rely heavily on tuition — like Webster — can be expected to struggle going forward.
Across the country, dozens of smaller colleges have shuttered in recent years, including Lincoln and MacMurray colleges in Illinois. Universities nationwide have lost nearly 1.3 million students since spring 2020, according to the National Student Clearinghouse Research Center.
And just as colleges try to rebound from a loss of students during the pandemic, they are simultaneously barreling toward a so-called “demographic cliff” in 2025-2026, when the 2008 recession turns 18 and its negative impact on birth rates means a smaller pool of high school graduates.
“It boils down to a supply-and-demand issue,” said Lisa Washburn, managing director at Municipal Market Analytics. “We’ve just got too many seats for too few students. Add to that rising costs and a pandemic, and some schools just become uneconomical to run.”
With fewer potential incoming freshmen available, Webster has turned more to non-traditional markets including international students and online students.
“It’s up to universities to adapt and change, as Webster always has,” Stroble said. “Branching out to take education to where the students are has always been a hallmark of Webster.”
Enrollment across all Webster campuses is up slightly to 10,578 for the upcoming academic year.
Webster University in Uzbekistan added close to 1,400 students last fall, a record for the campus that opened in 2019. And more than 350 new international students are studying in Webster Groves, doubling their pre-pandemic average.
A heavy focus on recruiting international and online students, officials say, will boost enrollment in coming years.
And they’re bullish on adjusting to meet the needs of high-demand career fields. By 2027, university officials aim to have enrolled 1,750 in the health science fields, comprising more than half the university’s 3,000 students in St. Louis.
It’s just the start of a financial turnaround, leaders said.
Stroble and university President Julian Schuster also pointed to new sources of revenue, including a recent federal grant of more than $1 million to upgrade its online nursing and science programs for students in rural Missouri.
Last month, the state’s Department of Higher Education and Workforce Development awarded two grants totaling more than $500,000 for job training, including teacher education in virtual learning. A $35 million fundraising campaign is nearly half fulfilled, Stroble said.
“The financial challenges are not something that can be changed overnight, (but) we are well on the way to improve our financial performance this year,” Schuster said. “Then we are developing the plan to balance the budget in a relatively short period of time.”
Bloomberg contributed to this report.
School year Total students
2022-2023 10,578
2021-2022 10,014
2020-2021 10,934
2019-2020 12,179
2018-2019 13,292
2017-2018 14,471
2016-2017 15,838
2015-2016 17,381
Source: Tax records, audits, bond documents
Webster University has posted operating losses since 2016.
Year Profit/loss
2021 -$24.5 million
2020 -$18.7 million
2019 -$17 million
2018 -$13 million
2017 -$12.8 million
2016 -$8.3 million
2015 $16 million
Source: Tax records, audits
Stay up to date on life and culture in St. Louis.
Steph Kukuljan covers real estate and development for the St. Louis Post-Dispatch. She is a St. Louis native.
{{description}}
Email notifications are only sent once a day, and only if there are new matching items.
Blythe Bernhard is a reporter for the St. Louis Post-Dispatch.
{{description}}
Email notifications are only sent once a day, and only if there are new matching items.
Webster University is facing financial pressure from lagging enrollment and debt that is outpacing profit.
The $44 million Browning Hall, center left, opened in 2017 at Webster University in Webster Groves, as seen Thursday, Jan. 26, 2023. The private school, once focused on the arts, built the interdisciplinary science building which features 27 laboratories to boost its health sciences offerings.
Webster University assistant professor Nicholas Curdt, right, leads nurse anesthetist students, from left, Kendra Davis, Angela Keilholz and Mackenzie Lee in a virtual autopsy during a class in Browning Hall on the Webster University Campus in Webster Groves on Monday, April 25, 2022. Webster University will launch the new College of Science and Health on June 1, they recently constructed a new interdisciplinary science building designed for the science and health programs. Photo by Colter Peterson, cpeterson@post-dispatch.com
Webster University assistant professor Nicholas Curdt demonstrates the abilities of the mock surgical room in Browning Hall on the Webster University Campus in Webster Groves on Monday, April 25, 2022. By 2027, university officials aim to have enrolled 1,750 in the health science fields, comprising more than half the university’s 3,000 students in St. Louis.
From left, nurse anesthetist students Mackenzie Lee, Kendra Davis and Angela Keilholz set up an ultrasound machine during a class in Browning Hall on the Webster University Campus in Webster Groves on Monday, April 25, 2022.
Get up-to-the-minute news sent straight to your device.
