We’ve Reached the Demographic Cliff. Now What?

We’ve arrived at the cliff. The precipitous moment in higher education is upon us where the number of traditional-age college students is expected to plummet. Well, kind of.  

For years everyone in higher education has been watching as we move closer to the so-called demographic cliff caused by lower birth rates following the Great Recession. The total number of high school graduates is expected to decline 13% through 2041.¹ On the other hand, the number of graduates who identify as Hispanic or multiracial is expected to grow,² and families aren’t waiting to move south until retirement, which is why Southern states will see an increase of 3% in high school graduates.³ Therefore, the outlook is far more nuanced than some of the headlines suggest, and some schools are stepping up their game to meet this challenge. 

Let’s dig deeper into the reality of today’s higher education landscape. Of recent high school graduates, 62.8% enrolled in college in fall 2024.⁴ From a glass-half-empty perspective, that means 37.2% did not enroll in college. There is admittedly competition for these students from speedier certification and technical programs, in addition to those graduates who choose not to enroll or cannot afford further schooling. However, it’s likely that some could be enrolled with additional outreach and the right financial package. 

Schools see the trends and the gaps and are considering several creative ways to boost, or at least maintain, enrollment numbers. 

I was a bit surprised when I saw a recent headline that Sonoma State University intended to boost enrollment 20% (in these demographic conditions?!).⁵ I was even more skeptical when I read that they had also recently moved to eliminate all Division III athletics as part of cost-cutting measures. Athletics are a huge recruitment tool for many DIII schools. Many schools I speak with look for incremental growth from new athletic programming where it makes fiscal sense. 

So how does Sonoma State plan to reach 20% higher enrollment in the next five to seven years? In addition to traditional marketing efforts, this will include adding artificial intelligence and predictive analytics to its recruitment tactics (something I look forward to exploring more later this summer). Sonoma is also exploring concurrent enrollment programs with community colleges, which I’ll discuss about more in a bit. 

Community colleges are a great source for inspiration when it comes to enrollment growth. They often have to work harder to attract students. One way is via “stackable credentials” that provide a pathway for students that lead to a job in less than a year in areas like healthcare, IT and manufacturing.⁶ While it would be a challenge for traditional four-year institution to deliver such expedited results, I have seen some offering accelerated programming geared toward the completion of a graduate degree within five years. Nonetheless, there are certainly lessons to be learned from the way community colleges are delivering a clear path to employment that warrant the investment in further education. 

I’ve previously mentioned the importance partnerships can play in higher education. As I personally learned through my nephew’s recent college search process, it’s hard to get into certain schools and, in particular, top programs. On the flip side, many small regional public universities struggle with enrollment and tight state support. Western Colorado University, for example, saw the demand from students like my nephew and partnered with the University of Colorado to deliver a top engineering program. Students can study in smaller classes while still earning an engineering degree from a top 20 university. 

Attracting international students has long been an important tactic for bolstering enrollment. However, caution is warranted as we anticipate headwinds in the current environment. 

The retention rate across higher education was 68.2% in 2022, with an additional 8.3% of students transferring institutions after their first year.⁷ This opens up two opportunities for schools to hone in on: early intervention with students at risk of leaving, and attracting students in looking to transfer later in their tenure. 

Many schools have implemented relationship management systems to detect those early warning signs that indicate a student may not continue at the institution. These often look at grades, participation, attendance and finance concerns to allow the appropriate department to intervene with support services. 

Students interested in transferring either from one four-year institution to another or from a community college can be a very attractive pool to fill in the tuition gap left over from those who do not remain. However, there is a lot of work to be done here by many in the industry. In fact, a study by National Association for College Admission Counseling indicated many high school counselors feel less prepared to talk about transfer options with students.⁸ Being able to discuss these options with a student may help sway them toward affordable options to help them achieve their goals. 

Many four-year institutions I speak with have articulation agreements with community colleges, but I find many don’t go far enough to ensure these students can easily transfer over. Surveys have shown that 80% of community college students aspire to a bachelor’s degree but only 16% earn it within six years of starting college.⁹ The most successful articulation agreements I have seen go deeper to emphasize what that path would look like. Aurora University in Illinois has partnerships with six area community colleges to create 2+2 programs that distinctly outline the pathways to the degree a student is seeking.¹⁰  

One of the least exciting but most practical ways to handle the demographic shift is to evaluate the appropriate size of the institution. Schools that may have attracted 2,000 students at their peak may find that 1,500 is a more sustainable enrollment size going forward. This approach isn’t making headlines or highly publicized by schools, but I’ve talked to many administrators who are implementing or considering a reduction. This allows them to improve budgeting, right-size their capital plans and plan for future workforce needs.  

On the capital planning front, I recently spoke with a school that is exploring the use of some of its excess housing to fill local housing gaps in the community. This has the potential to generate revenue, foster town and gown goodwill and bring new life to unutilized campus spaces. 

While the outlook for higher education is certainly challenging, I’ve been inspired by the innovations that many schools are implementing. 

_{1 Total Number - WICHE} 

_{2 Race and Ethnicity - WICHE} 

_{3 Geographic Location - WICHE} 

_{4 BLS News Release} 

_{5 Sonoma State turnaround plan calls for boosting enrollment 20% | Higher Ed Dive}  

_{6 Micro-pathways - Education Design Lab} 

_{7 https://nscresearchcenter.org/persistence-retention/} 

_{8 https://www.nacacnet.org/community-colleges-and-transfer/}  

_{9 Inside Higher Ed - Strategies for Improving Upward Transfer}  

_{10 https://aurora.edu/admission/transfer/2+2-transfer-plans.html}