- Today's colleges and universities face an unprecedented array of challenges and threats.
- These include enrollment declines, rising costs and student debt, emerging college alternatives, and political interference.
- Historically, higher education has weathered crises and disruptions, but this time feels different.
- Colleges must reinvent themselves quickly or risk alienating a generation of students seeking different options.
Higher education frequently makes the news these days, and most of the news is bad.
College enrollment has been declining since 2010. That's not surprising given rising tuition costs, mounting student debt, and emerging alternatives to college promising quicker and cheaper pathways to careers. The pandemic didn't help, either.
But there's so much more to the story.
Colleges have created an unstable financial model, and dozens have closed in recent years. Faculty are burned out and leaving. Politicians are meddling in higher education's business. A sensationalized scandal exposed hidden backdoors reserved for the wealthy. A skeptical public seeks greater transparency around admissions and finances.
Never before have colleges faced such stiff headwinds. Is this convergence of circ*mstances a temporary situation, or has higher education reached a tipping point beyond which lies a dangerous precipice?
In other words, is higher education in real trouble?
Let's take a closer look at what's going on.
Declining Enrollments Signal Changing Student Preferences
Perhaps the most distressing trend is that fewer people want what higher education offers. A recently released report from the National Student Clearinghouse Research Center shows that total enrollment for fall 2022 declined by 0.6% and was down by 1.23 million undergraduates compared to pre-pandemic levels.
Between 2011 and 2022, enrollment declined by 12.3%. Yes, the pandemic accelerated this trend: From 2019-2021, undergraduate enrollment dropped 6.6%, losing about a million students. Community colleges were hit especially hard, experiencing a 13% decline during that period.
Male students, in particular, are becoming increasingly scarce.
They now constitute 41% of students, an all-time low. From fall 2019 to fall 2020, the drop in enrollment of first-time male students was seven times greater than that for female students. Theories abound as to what's causing this phenomenon, one being that young men are becoming more attracted to careers in trades that don't require a college degree.
And if all that's not depressing enough, bear in mind we're headed toward a demographic cliff that threatens to tank enrollments even further. Thanks to a lower birth rate during the Great Recession, the population of prospective students will decrease around 2025, at which point prognosticators are projecting an additional 15% drop in new college enrollments.
Rising Costs Make College Unaffordable
Another factor driving would-be students away is rising costs. Since 1980, the cost of full-time attendance at a four-year college has risen more than 180%. At public four-year schools, tuition increases have outpaced inflation by 171% over the past 20 years.
It's not just tuition. Room and board charges have also risen dramatically.
Instead of curbing costs, many colleges are instead discounting tuition — returning a portion of each tuition dollar in the form of financial aid. A National Association of College and University Business Officers (NACUBO) study revealed that among private universities, the discount rate for first-time undergraduates reached a record-high 56.2% in 2022-23. This figure has grown almost 10 percentage points over the last decade.
Private colleges are returning to students more tuition income than they're keeping. That means they increasingly have to do more — or at least the same — with less. It's an unstable model trending in the wrong direction.
Even with such discounts, many families, especially those on the low-income end of the economic spectrum, find traditional higher education is no longer a viable option.
Student Debt Reaches Record Levels
Those who do choose to attend are taking on more and more debt. Since 2007, the amount of student loan debt has tripled.
All told, some 44 million Americans owe $1.77 trillion in student loans.
Graduating with an average debt balance of more than $37,000 financially cripples young Americans hoping to buy a home, get married, and raise a family. But the Biden administration's proposal to erase $10,000 in student loan debt for eligible graduates – and $20,000 for Pell Grant recipients – was struck down by the Supreme Court in 2023.
At the same time, a 2022 NPR poll showed that the majority of Americans want the government to prioritize reining in college costs over forgiving loan debt.
Meanwhile, millions of prospective students are weighing their post-high school options more carefully and, increasingly, choosing paths other than college.
New Alternatives to College Abound
What other paths do they choose? New options abound these days.
Take bootcamps, for example. Those looking to get into computer coding don't have to spend four years in college and pay four years of tuition. They can grab a certificate in a few months, spending roughly $13,500. Salaries are generally good, offering a solid return on investment. And placement rates rival or exceed those of top traditional universities.
Major employers such as Google and Microsoft offer their own in-house certifications. Students can earn a Google certificate in six months, becoming a data analyst or UX designer making more than $60,000 a year. Kent Walker, Google's senior vice president of global affairs, said the company considers these certificates equal to a four-year college degree in the hiring process.
Additional pathways include apprenticeship programs and trade schools for entry into fields such as healthcare, information technology, cybersecurity, hospitality, law enforcement, financial services, and graphic design.
All of these options offer a quicker and cheaper path to good careers. A burgeoning generation of "new collar" workers equipped with alternative, marketable credentials have discovered that college is no longer the only point of entry into the job market.
And into this mix the recent emergence of disruptive AI tools such as ChatGPT, which threaten to upend teaching and learning, and the value proposition of traditional higher education grows more opaque.
Dozens of Colleges Closing and Merging
Given the high-cost, high-discount financial model, sagging enrollments, and cheaper alternatives, it's no wonder so many colleges are closing their doors, some after hundreds of years of operation.
At least 49 public or nonprofit colleges have closed, merged, or announced closures or mergers since March 2020. Most of these were private colleges with low enrollments and modest endowments. For many, the pandemic pushed them over the financial cliff, but they were inexorably heading in that direction anyway.
Colleges in the Northeast and Midwest, where populations have been shrinking for some time, are especially vulnerable. The demographic downturn expected after 2025 doesn't bode well for institutions in those regions.
Tenure Is Threatened, and Faculty Are Dissatisfied
Full-time, tenured professors are going the way of the dodo. Driven partly by economics and partly by politics, tenure is eroding on college campuses, and faculty life isn't what it used to be.
Today, part-time faculty members account for 40% of the academic workforce, compared to just 24% in 1975. If you include part-time adjuncts, full-time instructors not on the tenure track, and graduate teaching assistants, that figure swells to roughly 75% of the instructional staff.
Adjunct faculty — higher education's migrant laborers — cost colleges far less and provide more flexibility. Having a faculty brimming with full-time, tenured professors is a luxury only the wealthiest institutions can afford.
What's more, tenure has come under attack from politicians. Numerous state legislators have sought to eliminate tenure, claiming the outdated practice protects lazy professors and facilitates student indoctrination.
The faculty route isn't as attractive as it once was. For newly minted Ph.D.s, the chances of landing a tenure-track position grow increasingly slim. The pay is relatively low given the amount of education required, and the last academic year actually saw a 2.4% decrease in salaries.
It's no wonder a 2020 Chronicle of Higher Education study found that more than half of college faculty said they were "seriously weighing options" outside of higher education. Many have already quit.
Can universities continue to attract the brightest minds and most dedicated teachers under these conditions?
Politicians Meddle, and Public Opinion Wanes
Beyond the tenure debate, politicians are busy sniffing around higher education's business. Last year, lawmakers in 16 states sought to limit the teaching of critical race theory at public institutions. Others want to further tax large endowments. Those initiatives are led by Republicans, 73% of whom believe "the higher education system in the U.S. today is generally going in the wrong direction."
Democrats, on the other hand, think colleges cost too much and don't adequately prepare students for jobs.
In fact, a Pew study breaking down public opinion of higher education by party affiliation showed that only half of Americans believe colleges benefit the nation. Positive feelings about higher education among both Republicans and Democrats have declined by 12 percentage points over the past decade.
Recent media coverage hasn't helped higher education's image, either.
The much-ballyhooed "Varsity Blues" case exposed the ugly truth about wealthy individuals greasing palms to worm their kids' way into elite colleges through backdoor channels. Yet other stories tell how children of rich alumni gain advantages through "legacy admissions" policies.
All this comes at a time when the name-brand colleges the media pays inordinate attention to have become so highly rejective that they're accepting 1 in 20 applicants.
Can Higher Education Emerge From These Threats?
Throughout history, higher education has faced numerous disruptions and emerged stronger.
The Civil War caused upheaval, as college men left to fight battles. But during that time, the federal government passed the Morrill Act of 1862, establishing land-grant colleges nationwide and democratizing higher education.
World War I disrupted campuses, as universities participated in the war effort, and the relationship between higher education and the government grew stronger. A similar pattern continued during and after World War II, when the federal G.I. Bill sent millions of returning veterans to college.
During the 1960s and 1970s, campus protests over the Vietnam War, free speech, civil rights, and gender equality shook the core of American universities, while elsewhere community colleges were popping up at a rate of one per week, creating avenues to educational opportunity for new populations.
Amid every dark cloud, higher education has realized a silver lining.
Yet this time feels different.
The threats are too numerous and trending in the wrong direction. Perhaps it's more evolutionary than revolutionary, and we're simply seeing new realities take shape in real time.
What we do know is that colleges and universities cannot continue to operate the same way and expect their lot to improve. How they reinvent themselves in the coming decade will determine their ultimate fate.
