In recent years, many universities have been facing financial difficulties with sometimes high deficits, so much so that some are thinking of closing. Let’s quickly analyze the situation in some European countries.

In France

The training costs of a student are around 10,000 euros/year while the registration fees are around a few hundred euros. This difference can be explained by a political decision aimed at training the greatest number of young people and therefore at financing universities greatly. For example, the University of Clermont Auvergne is forecasting a deficit of around €10 million for the year 2024[1]. In France, more than 60 out of 71 universities are at risk of experiencing a deficit this year. In general, these deficits are often due to factors such as rising energy costs, staff salaries, and building maintenance costs. To this must be added the greatest difficulty in obtaining European subsidies. This situation is the consequence of the cuts in credits allocated by the State. After the 900 million euros in savings requested from French universities at the beginning of last year, there is talk of an additional 500 million euros for 2025. A sum to be confirmed by the new government.

In Germany

Prestigious German universities such as Heidelberg, Munich, Berlin and Stuttgart have seen their deficits rise to nearly 4 million euros, while training costs and tuition fees are similar to those in France. The current recession could have harmful consequences for the years to come. The solutions envisaged are the increase of public partnerships, and the increase of tuition fees: although controversial, a moderate increase in tuition fees could help generate additional revenue.

In the United Kingdom

Although tuition fees range from £9,000 to £9,250 per year for UK and EU students, forty per cent of UK universities are in deficit. This is due to a broken funding model that is based on fees paid by students and the recruitment of students from abroad. As a result[2], the sector is multiplying its savings programs. “About 70 universities have made layoffs,” says John Rushforth, an expert on university governance. Courses are being cancelled, or even in entire departments. Sheffield Hallam University and Portsmouth University have announced that 400 jobs are at risk, representing 9% and 11% of their staff respectively. Coventry University has planned cuts to save nearly 100 million pounds (nearly 120 million euros) by 2026. Others are considering merging. The prestigious University of Cambridge[3] currently has a deficit of £53 million pounds.

Italy

The university[4] was one of the sectors most affected by the great crisis of 2008-2009. Indeed, the constant cuts in funding have meant that, in real terms, the public contribution is still lower today than it was 15 years ago. For this reason, the expenditure per student is 30 to 40% lower than that of European cousins. Universities like Foggia, Sannio, and Reggio Calabria are struggling.

Indeed[5], this negative trend is due to a decline in research outputs, amid increasing global competition from other, more funded universities. Italy’s position in education and research is under pressure due to the growth of higher education systems around the world; In China alone, investment in research has increased by 33%. Without additional public investment in research and development, Italy risks further reducing its performance in the future.

In Spain

As the new academic year begins[6], some faculties are expressing their deepest concerns about their budgets. According to a union, 60 universities are at risk of ending the year in deficit. For example, the Complutense University of Madrid closed the year 2023 with a deficit of 65 million euros. The reasons for these deficits are multiple:

• Reduction in government subsidies: universities have had their budgets cut by the government, which has limited their resources,

• Increased costs: costs related to payroll, infrastructure and equipment continue to rise,

• Falling revenues: Some universities rely on tuition fees and research revenues, which can fluctuate.

In conclusion

Thus, the situation is critical in many places in Europe, with disastrous consequences for the training of young people and for the adequacy of the labor market. Similarly, research aimed at the production of knowledge could also have detrimental spin-offs.

For an analysis of tuition fees in other countries, see the Eurydice report.

In other words, the competitiveness of European economies could be severely affected.

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[1] https://www.francetvinfo.fr/societe/education/enseignement-superieur-quatre-universites-sur-cinq-risquent-de-terminer-l-annee-en-deficit-selon-le-snesup-fsu_6788710.html

[2] https://www.lemonde.fr/economie/article/2024/09/29/au-royaume-uni-certaines-universites-risquent-de-ne-pas-passer-l-hiver_6338294_3234.html

[3] https://www.telegraph.co.uk/news/2024/10/28/cambridge-university-runs-up-53m-debt-without-knowing-why/

[4] https://sapere.virgilio.it/scuola/mondo-scuola/universita-a-rischio-in-italia-le-situazioni-piu-critiche

[5] https://www.ilfattoquotidiano.it/2024/05/13/la-universita-italiane-perdono-competitivita-nel-mondo-la-sapienza-cede-8-posizioni-male-pure-padova-e-milano-la-classifica/7546034/-

[6] https://diplomeo.com/actualite-enseignement_superieur_universites_deficit