COVID-19 concerns persist for university residence systems via worker shortages

IOWA CITY — The COVID-19 pandemic depleted resources across Iowa’s public university residence hall systems in the last budget year — to the tune of millions of dollars — and even though the campuses are back to mostly in-person classes and traditional operations, fallout for the dorms and dining halls continues.

But rather than flailing housing contracts, offline residence halls and skyrocketing expenses for sweeping new safety measures, the biggest COVID-19-compelled concerns this year involve supply-chain issues, worker deficiencies and inflation.

“Whether it has been food-supply shortages, which required menu changes for thousands of meals, or an inability to recruit or hire enough cooks or custodians, the impact of the COVID-19 pandemic has continued well beyond the initial concern for the health and safety of our students and our employees,” University of Northern Iowa Housing and Dining Executive Director Nick Rafanello said.

The University of Iowa and Iowa State University housing and dining systems also report major challenges this year hiring and retaining workers — even as student interest in residence hall living revives and revenue trends up, with housing and dining rate hikes looming.

Worker woes

Among the campuses’ primary methods for combating worker woes has been to raise wages — such as at Iowa State, where the dining operation typically employs 1,100-some students as its campus’ largest student employer.

“In the early fall semester, we had to increase student salaries to $13 an hour,” ISU Associate Vice President for Campus Life and Director of Residence Pete Englin said. “This was in response to only having 25 to 45 percent of our scheduled and needed student shifts covered in our ISU dining units.”

UI Housing and Dining through the pandemic has had 50 percent to 60 percent its optimal student dining employees. Its custodial staff has 75 percent to 80 percent of positions filled, according to Von Stange, assistant vice president for student life and senior director of university housing amd dining.

“When we missed income for the year, we were able to make it up through reduced expenses, mostly due to increased staff vacancies and significant salary savings in that area — which is not the way we would have preferred to close the gap,” Stange said. “We cannot effectively operate a housing and dining operation without a full and competent workforce.”

So UI, too, raised student-staff wages, by $1.50 to a minimum of $11 an hour, “due to a severe shortage of student labor.”

“We also raised salaries for our custodians, kitchen helpers, and cooks to a minimum of $15 an hour due to severe shortages,” Stange said. “We're slowly adding staff, but as we get new staff, other staff members are either retiring or leaving for better paying jobs in the community.”

From a business-model perspective, university housing and dining operations not only have competitive limitations regarding pay, Stange said.

“When I drive down through the Iowa City-Coralville business district, I see restaurants that are closed on certain days of the week due to lack of staffing,” he said.

“But we're different than much of the community market. If we are understaffed, we can't reduce dining hall hours or choose not to clean the lobbies or the bathrooms. We can't make the decision to close the dining halls on a Monday night due to staffing shortages.”

Revenue growth

All three of the regent universities’ housing and dining operations are self-supported, meaning they don’t received general-fund aid from their respective institutions. But Stange said UI did allocate some of its federal COVID-19 relief funds to housing and dining.

“The university has continued to support our departments and our students during the pandemic, allowing us to meet our obligations to our students and our bondholders,” Stange said. “Without their support, we wouldn’t be able to limit our room and board increases next year to 3 percent, while inflation might suggest higher rates.”

Although regents aren’t scheduled to consider proposed room and board rate increases until April, all three campuses said they’re planning bigger hikes than they’ve had in years — 3 percent at both UI and ISU and 2 percent at UNI.

UNI, for the past two years, kept rates flat. Iowa State actually dropped rates last year, by 1.1 percent.

The new increases for next year, if the board approves them, paired with a measured anticipated return of residents — although not quite to pre-pandemic levels — are expected to boost revenue at UI and ISU.

While UI revenue estimates for the current budget year are $69.8 million — more than $3 million shy of the fiscal 2022 budget of $72.9 million — next year’s UI housing and dining revenue is expected to jump more than $10 million to $80 million.

Iowa State’s 2022 estimates are actually $3.3 million ahead of budget, and officials expect those numbers to increase another nearly $4 million next year.

UNI estimates this year also are just ahead of budget, but that campus expects a slight dip next year, as it has experienced enrollment losses.

Student predictors

First-year enrollment serves as a strong predictor for university housing and dining contracts, and UI is anticipating a 279-student increase next fall to 4,800 freshmen — up from 4,521 for fall 2021.

“We opened our housing portal for prospective students in mid-January and had 3,000 applications in the first five hours,” Stange told the regents last week. “And we didn't break the internet.”

Though Iowa State isn’t airing predictions for its next freshman class, officials are reporting total occupancy this fall was 8,948 — above the 8,600 budget — and is expected to increase to 9,177 next fall. The occupancy and rate bumps are expected to generate $5 million in “incremental contract revenue.”

“In total, we opened with almost 400 residents ahead of what we forecast,” ISU’s Englin said. “As of today, we're tracking over 300 contracts ahead of last year at this time.”

The numbers all remain below pre-pandemic levels. And despite some encouraging signs, all three campuses report their reserves took a hit during the pandemic — limiting their capacity to reinvest in the housing and dining system until stockpiles are restored.

UI Housing and Dining’s “voluntary reserves” are expect to end the year at a balance of $6.3 million — down from an end-of-year balance of $20.6 million five years ago. While Iowa State’s voluntary reserves sat at $44.4 million at the end of the 2017 budget year, they’re estimated at $26.4 million for this year.

And UNI’s $22.6 million end-of-year reserves five years ago are down to an estimated $18.3 million this year and anticipated $15.7 million next year.

“The pandemic has depleted our reserves,” UI’s Stange said. “It will take a few years with strong residential occupancy to build our reserves back up.”

Vanessa Miller covers higher education for The Gazette.

Comments: (319) 339-3158; vanessa.miller@thegazette.com