The higher education sector is experiencing an accelerating wave of institutional closures, with Huron Consulting Group projecting that over 440 private nonprofit four-year colleges and universities—representing roughly a quarter of all such institutions—face elevated closure risk based on enrollment trends, debt levels, and other financial indicators. Small, rural, and religiously affiliated colleges are particularly vulnerable to shutdown.
Multiple demographic and policy factors are driving enrollment declines across the sector. A demographic shift that began around the time of the Great Recession is expected to reduce the number of 18-year-olds per year by 15 percent by 2039. College enrollment has already fallen by approximately 2 million students since 2011, and the proportion of high school graduates pursuing immediate college enrollment has decreased from a peak of 70 percent to just under 63 percent in 2024. Additionally, international student recruitment has declined sharply due to stricter visa policies and increased costs, while proposed federal loan restrictions for graduate and professional programs threaten to reduce demand for revenue-generating advanced degree offerings.
The consequences for affected students are substantial. Research from the State Higher Education Executive Officers Association indicates that fewer than half of students attending colleges that close manage to continue their education elsewhere, and only half of those who do transfer ultimately earn degrees. Approximately 670,000 students are currently enrolled at institutions identified as being at significant closure risk.
In response to these challenges, policymakers and institutions are implementing protective measures. Massachusetts has required private colleges to disclose financial reports and publicly identify institutions facing imminent closure, following 27 institutional shutdowns or announced closures since 2014. Twenty-two states now mandate that private higher education institutions contribute to tuition recovery funds to compensate students if their colleges close, and similar federal-level provisions have been proposed. Federal policymakers are also exploring streamlined merger processes to allow troubled institutions to consolidate with stronger competitors rather than cease operations.
Despite these challenges, prospective students have benefited from increased acceptance rates and enhanced financial aid packages as institutions compete for declining enrollment. Some colleges have begun admitting students without applications and waiving fees to attract prospects. One company has also begun creating virtual reality tours of closed campuses, including Trinity Christian College in Illinois, which closed in May, to preserve their historical legacy.
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