The Brave New World of High School Sports

Months after Covid-19 shutdowns overturned our lives, people continue to ask big questions. What’s normal supposed to look like? Which trends are here to stay? In the world of high school athletics, the answers to these questions will prove critical over the coming years.

Two trends in particular point to major shifts on the playing field: tighter financial conditions and a growing emphasis on individual performance.

After investing heavily in sports programs in the 1990s and 2000s, schools confront a rockier financial landscape that will impact their ability to deliver results.

At the same time, the recasting of athletic achievement around “me” challenges the team ethic that helps build character in kids, jeopardizing how youth sports support mental health.

Slowing Rates of Growth

Participation in high school sports in 2021-22 dropped to its lowest level in 13 years. 7.62 million athletes participated in 69 sports, down 4.5% from its all-time high of 7.98 million in 2017-18. Four percent fewer boys and five percent fewer girls now compete in interscholastic sports.

The National Federation of State High School Associations (NFHS), which collects the data, attributes the reductions to pandemic-related delays in programs getting back on their feet. State associations did not report data for the 2019-20 and 2020-21 academic years. (View survey results.)

Although NFHS expects a rebound in the current 2022-23 period, the trend overall has been flat to negative. Total participation, for example, had already declined 0.5 percent year-on-year in 2018-19.

From 2010 to 2019, participation grew at two percent—less than half the 2000-2010 level and two-thirds less than the 1990s. During the 1980s, growth rates were flat to negative. See table below.

Total High School Enrollment

Between 1980 and 2019 participation in sports as a percentage of public high school enrollment increased from 40.5% to 52.2%, peaking at 52.7% in the 2013-14 academic year.

Student enrollment over the 39 year period grew from 13.2 million to 15.2 million—an average annual increase of 0.37%. Gains mostly occurred in the 1990s and 2000s, and moderated sharply after 2010. Enrollment dropped during Covid.

By decade, participation as a percentage of enrollment grew 0.26% on average in the 2010s. It increased 0.43% in the 2000s and 0.51% in the 1990s. See table above.

Sports Participation versus Total High School Enrollment

The chart below shows total participation in high school sports as a percentage of school enrollment from 1990 to 2021. It excludes non-reported or incomplete data in 2019-20 and 2020-21 due to Covid 19.

Growth accelerated over two eight-year periods: first, from 1992-93 to 2000-01 and, second, from 2005-06 to 2013-14. After 2013-14, and prior to the pandemic, growth flatlined. In 2021-22, participation dropped to 49.28%, (red-colored bar).

Universities Rake in Big Bucks

To understand high schools, consider, first, the post-secondary experience and the expectations it sets.

During the 1990s, colleges and universities began spending heavily on campus improvements, including athletics. A strong economy throughout the 1980s and 1990s boosted balance sheets. Alumni giving escalated to unprecedented levels.

Nothing better illustrates a college’s financial strength than its endowment fund. The endowment encompasses capital campaign proceeds and thousands of restricted gifts. Investment managers put its capital to work in the financial markets. Spending distributions ranging from four to six percent cover operating and capital costs, in all areas including athletics.

Harvard University, for example, boasts the world’s largest academic endowment fund. Its fund swelled from $1.6 billion in 1981 to  $53.1 billion in 2021—averaging an impressive 9.16% in annual growth (net of investment performance, contributions, distributions, and fees). The S&P 500, by comparison, compounded at a robust 11.75% including dividends.

As the table suggests, the statistical relationship between Harvard’s endowment and the S&P 500 is significant: p<.001, t(40)=-7.619, R2=0.832. Up or down movement in the index causes a similar degree of movement in the fund.

In 2020-21, college endowments notched one of the biggest return years ever. High-risk alternative investments fueled eye-watering returns of 30% to 50%. Over the same time period, the S&P 500 rose 34.4%. In the two years ending June 30, 2021, the index rocketed 47.5%. Good times for sure until 2022’s reversal.

Athletic Budgets Upwards of $150 Million

Harvard’s alums and endowment subsets support the school’s $30 million athletics budget and 42 varsity sports. In contrast, the smallest-budget schools in the Power Five Conferences allocate twice as much to athletics. Yet, they offer half as many sports.

The biggest-spending Power Five schools, on the other hand, fork out more than five times the Crimson’s budget.

Big program schools depend heavily on ticket sales, television revenue, and licenses to cover costs.

Of the top spending Power Five schools, Texas, Stanford, Texas A&M, and Michigan showcase endowments that rank among the ten largest in the country. Notre Dame, a non-conference university that competes against the Power Fives, shares a similarly sized fund. The majority of schools, however, line up far lower.

Downstream Effect

Local communities, likewise, began investing heavily in school districts and sports programs, with states and the federal government also contributing. Texas school districts, for example, have spent tens of millions of dollars on football complexes. The latest NFHS report, as noted above, lists a whopping 69 sports in which high school students now compete. Ten years ago, it counted 42 sports.

More and more tax dollars have gone to schools and athletic programs, expanding quality and accessibility.

Fewer Two- And Three-Sport Athletes

Colleges and Universities require a steady flow of athletes to fill multimillion dollar facilities. High schools, as a result, compete to deliver the best athletes to the best programs, insofar as they can. Many athletes join club teams to accelerate development beyond what schools can offer.

Over the past ten years, athletes have increasingly specialized in one sport. Exact numbers are hard to determine. NFHS’s annual report, for example, captures all participation, including two and three sport athletes. NFHS does not calculate the number of unique athletes. 7.62 million participants, accordingly, could be four, five, or six million individuals.

In 2017, the NCAA surveyed athletes about the number of sports they played before college. Results skewed markedly by sport, with many athletes selecting a sport by the age of 12:

• 87% of DI women gymnastics had specialized in the sport by the age of 12.
• 68% of DI men’s soccer players and 62% of DI women’s soccer players were one-sport soccer athletes by 12.
• 66% of DI men’s tennis players and 75% of DI women’s tennis players specialized in their sport by age 12.
• 55% of DI men’s ice hockey players specialized in their sport by age 12.

While…

• 71% of DI men’s football players were multisport athletes.
• 88% of DI men and 83% of DI women who play lacrosse also played other sports.
• 87% of DI female runners and 91% of DI male runners were multisport athletes.

Participation versus the Market

The chart below plots sports participation as a percentage of school enrollment against the S&P 500 from 1991 to 2019 (annually on June 30). The relationship is statistically significant: p<.001, t(28)=-10.35, R2=0.704.

No question market returns affect team activity at the high school level. Stronger markets increase the tax base, which, in turn, generates additional funds for school budgets. Current market weakness coupled with participation having leveled off prior to Covid 19 suggest a more limited recovery in students playing sports.

Meanwhile—upstream—university endowment funds, in the latest period (2021-22), reported their worst returns in six years. If current market conditions persist, universities could experience losses that wipe out years of gains.

Specializing in Individual Performance

Parents and athletes view specialization as the best route to acceptance at elite colleges and scholarship opportunities. Rising tuition and falling admission rates have raised those stakes even higher in recent years.

Nevertheless, specialization doesn’t have to be all about individual performance. An athlete could specialize in a sport and, at the same time, embrace team dynamics.

Social media, however, has changed the focus. Platforms such as Snapchat and TikTok have normalized individual performance and bragging rights: look better; play better; let everyone know about it.

On top of that, the NCAA, by allowing athletes to cash in on name, image, and likeness (NIL), has elevated individual performance like never before. (Read From Zero to NIL for a discussion on NIL’s impact.)

It’s no surprise, therefore, that many high school athletes view specialization and individual performance as hand in hand.

“De-Escalation” of Team Ethic

Coaches, administrators, and other sports leaders—many in their 50s and products of the 80s and early 90s—lament the decline of the team. Skip Gilbert, CEO of US Youth Soccer, writes:

“One emerging trend that could have significant impact across our sport is what I call the de-escalation of a team ethic. When you watch sports highlights and listen to stories from other sports, the attention is so focused on the individual player, the danger is that the underlying responsibility to the team could potentially now take a backseat.”

Mr Gilbert intends that “every child [who] wants to play soccer receives a true team experience for all to enjoy today and for the rest of their life.”

Whether the tide has turned against team ethic or his vision plays out remains to be seen.

To be sure, anyone hoping to revitalize team ethic will likely confront NIL and its spotlight on individual performance.

Recruited athletes increasingly consider NIL potential alongside—or above—coaching style, facilities, and playing time at potential programs. For this reason, colleges are adding NIL departments and forming collectives to connect athletes to money-making opportunities.

Team Sports And Mental Health

Studies illustrate how team sports support mental health. According to one such recently published paper:

“Participation in team sport compared to non-sport participation was associated with 10% lower anxious/depressed scores, 19% lower withdrawn/depressed scores, 17% lower social problems scores, 17% lower thought problems scores, and 12% lower attention problems scores. Participation in team sport compared to non-sport participation was also associated with 20% lower rule-breaking behavior scores for females (compared to males).”

Surveying 11,000 children and adolescents, the researchers in this June study describe how team sports such as volleyball, soccer, and basketball increase social interactions and feelings of relatedness.

In contrast, they report opposite effects in individual sports (ballet, dance, gymnastics, tennis, wrestling): “16% higher anxious/depressed scores, 14% higher withdrawn/depressed scores, 12% higher social problems scores, and 14% higher attention problems scores.”

They ascribe worse outcomes in individual sports to performance expectations, negative body appraisals, and not having teammates to offset stress. They do acknowledge, however, that other studies have demonstrated mental health gains in individual sports.

(Read The Mental Health Crisis for analysis of mental health trends.)

Covid-19’s Effect

In 2020—during the pandemic—the average number of team sports youth ages 13-17 played on a regular basis declined 13%, according to the Aspen Institute. Reasons include lockdown restrictions and flip-flopped seasons: football, in this case, played in the spring.

Baseball participation fell 17% year-on-year, cheerleading 27%, and swimming 19%—to name only a few sports. Participation, on the other hand, gained in individual sports: golf (33%), tennis (17%), and bicycling (5%).

Churn rates—the difference between people starting and quitting a sport—accelerated, in particular in gymnastics (-20.2%), volleyball (-18.2%), and track (-12.6%). Basketball had the highest net gain at 10.6%.

Road Ahead

Does the Covid-19 upheaval herald a permanent shift in high school sports? Much could depend on the economy and how parents and athletes value team sports. Will schools have the resources to invest in sports programs? What expectations will colleges and universities set?

Covid shutdowns coincided with stalled growth in sports participation. Societal factors such as social expectations, lifestyle, and leisure time emphasize individual achievement more and more. Fewer kids, as a result, crave a traditional team experience.

If the present course carries on, mental health could continue to deteriorate.

For high school team sports, the landscape is changing quickly, and leaders will need to find new ways to coach their programs effectively.

Sydney is Stride’s Founder.