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Though college enrollment seems to be stabilizing after the pandemic disruptions, predictions for the next 15 years are grim. Colleges will be hurt financially by fewer tuition-paying students, and many will have to merge with other institutions or make significant changes to the way they operate if they want to keep their doors open.
At least 30 colleges closed their only or final campus in the first 10 months of 2023, including 14 nonprofit colleges and 16 for-profit colleges, according to an analysis of federal data by the State Higher Education Executive Officers Association, or SHEEO. Among nonprofits, this came on the heels of 2022, when 23 of them closed, along with 25 for-profit institutions. Before 2022, the greatest number of nonprofit colleges that closed in a single year was 13.
Over the past two decades, far more for-profit colleges closed each year than nonprofits. An average of nine nonprofit colleges closed each year, compared to an average of 47 for-profit colleges.
This time last year, experts predicted we’d see another wave of college closures, mostly institutions that were struggling before the pandemic and were kept afloat by Covid-era funding. Since then, keeping their doors open has become unrealistic for these colleges, many of which are regional private colleges.
“It’s not corruption, it’s not financial misappropriation of funds, it’s just that they can’t rebound enrollment.”
Rachel Burns, a senior policy analyst at SHEEO.
For many, the situation has been made worse by the enrollment declines during the pandemic.
“It’s not corruption, it’s not financial misappropriation of funds, it’s just that they can’t rebound enrollment,” said Rachel Burns, a senior policy analyst at SHEEO.
Data from the National Student Clearinghouse shows that undergraduate enrollment has stabilized and even slightly increased for the first time since the pandemic, but a continuing decline in birth rates means that fewer high school seniors will be graduating after 2025, so these colleges will face even greater enrollment challenges in the years to come.
Hundreds of colleges are expected to see significant enrollment declines in the coming years, according to David Attis, managing director of research at the education consulting company EAB. Among the reasons, he said, are declining birthrates, smaller shares of students choosing college, and college-going students veering toward larger and more selective institutions.
By 2030, 449 colleges are expected to see a 25 percent decline in enrollment and 182 colleges are expected to see a 50 percent decline, according to an EAB analysis of federal enrollment data. By 2035, those numbers are expected to rise to 534 colleges expecting a 25 percent decline and 227 colleges expecting a 50 percent decline; by 2040, a total of 566 colleges are expected to see a 25 percent decline and 247 are expected to see a 50 percent decline, according to EAB’s analysis.
These are predictions, of course, and they certainly don’t ensure that all those colleges will close. But with these drops in enrollment expected to continue, colleges need to plan now and make significant changes in order to survive, Attis said.
“Imagine if you lose half your students – that is a threat to your continued existence.”
David Attis, managing director of research at the education consulting company EAB.
“Imagine if you lose half your students – that is a threat to your continued existence,” Attis said. “You’ll have to make some pretty dramatic changes. It’s not just a ‘We’ll cut a few academic programs,’ or ‘We’ll trim our administrative staff a little bit.’ That requires a real reorientation of your whole strategy.”
Many colleges face the decision to merge with another institution or close down entirely, Attis said. And if they wait too long to find a college to merge with, they really won’t have a choice.
“If you wait until you’re on the verge of closure, you’re not a particularly attractive partner,” Attis said. “But if you’re not on the verge of closure, then you’re not as motivated to find that partner.”
Attis said that he’s been surprised to hear from several leaders of regional colleges – both private and public – that they are in talks about mergers.
“Whether they’ve pursued them or not, they’ve either made a call or gotten a call,” Attis said. “They’re thinking about it in a way I hadn’t heard in the past.”
This story about college closures was produced by The Hechinger Report, a nonprofit, independent news organization focused on inequality and innovation in education. Sign up for our higher education newsletter. Listen to our higher education podcast.
As a father, intricately involved in the college admissions process for three of my children over the last four years, I am well equipped to speak to issues driving students away from formal education.
Honest colleges and universities are competing against dishonest mega schools run as businesses but inappropriately benefiting from nonprofit status. These nonprofit schools plow the money they should pay in taxes into marketing. They lie and mislead prospective students and play games with student financial aid.
Broader issues affecting all students include the following:
1) Tuition has risen far faster than inflation driven by student loans. Taxpayers should not be funding student loans.
2) College has become far less relevant as many colleges and professors focus on leftist indoctrination, DEI and other nonsense rather than teaching useful information.
3)Most students lose a significant amount of credit when they transfer courses to a different school. Introductory courses should contain the same essential information to reduce cost and facilitate credit transfer.
4) The proliferation of free or low cost non-collegiate online educational resources has reduced the pool of potential students.
5) Abortion has reduced the birthrate and the pool of potential students.
6) For decades we have been pushing students to college who would be far better served going to vocational school and learning a high paying trade. German has an excellent system of vocational education America should model.
“We’ll trim our administrative staff a little bit.” That’s the most important sentence in the article. Many administrative staffs have swollen unnecessarily over the past 20-30 years.
Jim Worrall may need to educate himself before attacking higher education for failing to do so. First, going through the process of introducing young people to colleges is instructive and sometimes enlightening, but it doesn’t make him or anyone else an expert on what attracts colleges toward or drives students away from higher education.
Second, it’s unclear what he means by “honest” and “dishonest mega” schools, although it isn’t hard to guess. The universe of schools isn’t divided neatly into those two categories. If you have a problem with certain “schools,” Jim, name them!
Third, the “leftist indoctrination, DEI nonsense” remark is a dead giveaway for Jim’s white nationalist agenda.
Fourth, we taxpayers underwrite lots of things, Jim, including corporate welfare. Financial aid to students is among the best uses of tax money.
Fifth, the claim that abortion is reducing the birthrate and therefore the cohort of college-bound students is, well, just laughable.
Want to have a legitimate, data-based conversation about financial aid, transferability of college credits, the tax status of certain non-profits? Sure. But I for one would rather that conversation with someone who’s less ideological. Which is to say, with someone who’s done his homework.
For 25 years I led an association of 35 small private liberal arts colleges developed to provide faculty and students fellowships and grants. I watched four of those colleges close during my tenure, and four others have closed since I left the association in 2008. It is sad that they closed; even sadder is the way that they closed–denying the need to close until there were few resources for a graceful transition period. When a new vice president at one of the major foundations supporting the association asked me to tell him about the member colleges, I ended that presentation by saying, “And some just need to close.” He asked, “Which do you think need to close?” I replied, “Virginia Intermont.” His response was, “My mother went there.” While I was thinking about the others I should have mentioned instead of VI, he said, “That college should have closed 20 years ago.” And that is one of the saddest statements that can be made about colleges closing: they need to close while they still have the resources to do so with some grace–severance pay for faculty looking for new jobs, scholarships for students transferring, and documentation of the history of the college and all that it accomplished. “Death by a thousand cuts” is not a graceful way to die.