Between 2025 and 2029, the college-age population in the United States will drop by 15%, predicts Nathan Grawe, an economist at Carleton College. And the population will continue to shrink by another percentage point or two in the years that follow.
"When the financial crisis hit in 2008, young people viewed that economic uncertainty as a cause for reducing fertility," Grawe told Jill Barshay at the Hechinger Report. "The number of kids born from 2008 to 2011 fell precipitously. Fast forward 18 years to 2026 and we see that there are fewer kids reaching college-going age."
So what does this mean for colleges and universities? Regional four-year institutions will lose more than 11% of their students between 2012 and 2029, predicts Grawe. But elite institutions—the top 50 colleges and universities, as ranked by U.S. News & World Report—will see demand grow by 14% during the same period.
Demand for elite institutions will hold steady for two reasons. "The people who went to college 20-30 years ago and got a degree, they’re now the parents of kids who are looking at going to college in the next 10 years or so," says Grawe. Because many of the prospective students in this shrinking demographic are children of college graduates, they are more likely to attend college—and elite colleges, in particular. Growing numbers of Asian-American students may also contribute to this trend: "They have a high attachment to higher education in general and elite higher education in particular," says Grawe.
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But colleges will feel the effects of the declining student population differently, based on their location, predicts Grawe. For example, the Northeast—where a disproportionate share of U.S. higher ed institutions are located—will see the greatest fall in demand, due, in part, to shifting demographics. And states with fewer colleges and universities, such as Utah and Montana, may see a slight bump in demand, says Grawe.
But colleges will have to compete intensely to recruit these students, Grawe predicts. "Students are going to be a hot commodity, a scarce resource," says Grawe. "It's going to be harder during this period for institutions to aggressively increase tuition."
To attract students on a leaner budget, colleges may face pressure to cut liberal arts courses in favor of professional programs that translate directly to jobs, argues Grawe. Some colleges may also face closures as funding declines, he says.
Colleges and universities may be able to dodge some of these grim predictions by focusing on student retention and student success initiatives that keep students—and their tuition dollars—returning to campus, suggests Grawe. For example, the University of Southern Maine, which has already experienced falling enrollment, has seen its budget grow due to efforts to retain students through to graduation (Barshay, Hechinger Report, 9/10).
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