This incoming class is the last big one before a prolonged decade-plus drop off begins.
Starting this year, the graduating classes of high schools across the country are getting smaller, the result of fewer people having children during the Great Recession and the years after. Even after the economy rebounded, the birth rate kept dropping. The COVID pandemic led to another sharp decline.
This is the beginning of what college officials call the “demographic cliff.” Higher education is one of the few industries that can predict its future customer base far in advance. When college leaders look at the projections of high-school graduates, they see down arrows only every year through 2041 — by then totaling a 13 percent drop overall to 3.4 million high-school graduates from nearly 3.9 million this year.
This makes a lot of sense to me. My hunch is that schools have thought about this. Some, like many of the New England SLACs, have been quite strategic in making their brands desirable beyond their region. And there are some that have not and will likely suffer. Leadership’s vision matters.
Not mentioned in the article are changes we’ve all speculated about on the college closure thread. Might some schools figure out how to deliver a high-focus, low-frills product at a significantly different price point? Where do international students fit into this? How do community colleges change?
I suspect that some of what Selingo anticipates will happen is right on the money, but that there may also be some versions of college that differ from what we know or imagine today. He’s right that it’s not sustainable as is.
I struggle with a 13% drop calling it a “cliff”. Need to layer in international applicants as well (will they tap into that applicant pool more than they had previously?).
The schools on shaky ground today are likely to be most impacted. Students that might have otherwise gone to those schools and were on the bubble for a “better” school now maybe get into that better school.
It depends upon the segment.
T100 schools will likely see a leveling out or even an increase in applications.
Lower ranked schools may see a decrease in applicants and school closures may increase for the most marginal schools in terms of popularity or economics.
And I use the “rankings” precisely because most kids, sadly, 100% believe what USNWR and others are selling.
Less than half of high school graduates go on to a 4 year college/university.
How do we know higher ed will feel the pain? Perhaps the trades will suffer the most.
The sticker price of a 4 year degree is much more likely to reduce enrollment than a shrinking pool of applicants.
I think that high sticker price is exactly why it will be colleges affected and not the trades.
I do think the elite academic schools will be fine. And we’re already seeing the climbing popularity of flagship state schools. I think the danger is most pronounced for colleges below the elite yet still expensive. Value shoppers will avoid them and the smart and/or rich will want something better academically or reputationally.
Some potentially offsetting effects drawing on Common App’s latest reporting:
The number of applications per applicant appears to keep rising.
There has been some gap-closing in first-gen and low-income application rates.
Growing International applicants had been contributing until this last cycle, and that might come back.
Collectively these effects have meant both applicants and even more so applications have been increasing significantly faster than US HS graduates, and actually there was a notable acceleration post-COVID.
OK, so HS graduate levels starting to decline may slow this effect down, but I am not at all sure either applicants or applications will actually go negative. I think there is a decent chance this combination of other effects will more than offset the expected declines in HS graduates for at least quite a while longer.
Like the overall rate of increase in applicants has been about 6% a year since 2015-16, and applications has been about 10% per year since 2015-16, and still 5% and 8% this last year despite the International leveling off.
The HS graduate population has only been increasing something like 0.7% annualized, so almost all of that increase has NOT been caused by HS graduate population increases.
The projections in question are then US HS graduations are going to go to something like -0.8% annualized over the next 15 years, a net swing of 1.5%. But subtracting 1.5% from 5-6% is still an increase in applicants, and further increases in applications per applicant would keep adding even more growth in applications.
That said, we are already seeing declining applications and enrollments in some parts of the system, even as applications and rejections keep increasing in other parts of the system. And so even if the overall applicant and applications trends stay positive, if they even just slow down that could accelerate the declines in some parts of the system.