Enrollment Challenges: Is Higher Education Growing or Shrinking?

The University of the Arts (known as UArts), a Philadelphia institution dating back to the 1870s closed on Friday, June 7, 2024. This announcement is just the latest in a series of closures among higher education institutions in the US. 30 campus closures were found in the last year alone, after nearly 50 the previous year. Higher education, long perceived as immune to the shifts affecting other industries, is now feeling the impact of various cultural and economic trends. Factors such as demographic changes, cultural perceptions, lack of product differentiation, financial planning challenges, and the rise of cost-efficient mega-institutions are putting immense pressure on smaller colleges, forcing many into consolidation.

The Chronicle reports that while there is a contraction in higher education, it is occurring against a backdrop of substantial growth over the past 20 years​​. The recent leveling off of growth highlights the consolidation trend among larger institutions, much like Amazon and Walmart have consolidated consumer spending, driving some smaller retailers out of business.

In the academic world, the introduction of online offerings, cheaper alternative products, increased choices, and atomization of content are exerting pressure on smaller institutions. As with other industries, the path forward for these colleges is to differentiate their offerings amidst the backdrop of consolidation. Smaller institutions have strategic advantages and unique benefits that they can leverage to attract and retain students. By focusing on their distinct strengths and differentiating themselves from both each other and larger consolidated entities, these colleges can remain competitive. Their size and offerings can become strategic advantages.

Some institutions are successfully navigating these challenges and even thriving. For instance, Lake Erie College managed to stave off closure through strategic planning and community support​​. Berea College in Kentucky offers free tuition and a work-study program, emphasizing its heritage as the first interracial and coeducational college in the South. Similarly, the College of the Atlantic in Maine stands out with its focus on Human Ecology and hands-on learning.

As demographic pressures increase and consolidation continues, smaller institutions can continue to thrive by offering unique and advantageous experiences to their students. By capitalizing on their distinct characteristics, these colleges can carve out a niche and remain viable in a competitive landscape.