As detailed on this site in 2013, Clayton Christensen and I made a bold prediction in The New York Times: “A host of struggling colleges and universities—the bottom 25 percent… will disappear or merge in the next 10 to 15 years.” Christensen would sometimes make bigger claims in speeches and suggest that a half of colleges and universities could close, merge, or go bankrupt, even as the 25% number remained the baseline of our prediction.
Many in the higher education establishment and media scoffed at the prediction. In 2018, I amended the prediction to suggest that we were directionally correct, but the prediction would probably play out over 20 years, not 15. And it likely should not only include college consolidation, but also significant restructurings.
So, roughly a decade in and still before the demographic decline hits colleges—particularly those in the Northeast and Midwest—how is the prediction holding up?
Pretty well it turns out.
It’s become commonplace to note that one college is closing every week this year, according to the Hechinger Report’s Jon Marcus (important to note: the rate of closures did slow over the summer).
But starting with the 2013-14 academic year, a whopping 726 degree-granting institutions closed through the 2022-23 school year, according to the National Center for Education Statistics. That means in just nine years, 15% of the-then 4,724 degree-granting colleges or universities closed.
The higher education establishment will be quick to note that most of these—80%—were for-profit schools closing. But as I wrote in 2018 when I explained the prediction in greater depth: “Although some have said that our prediction is incorrect because for-profit universities are closing at the fastest rate, we never said that for-profit universities were inherently disruptive or likely to succeed.”
Indeed, for-profit institutions that are tuition-dependent, have weak brands, and have been hit by regulatory pressures were certainly vulnerable. And they continue to be so. It’s unsurprising that many of their campuses have closed nationwide. More will.
Ultimately, after all, the prediction is a result of business model failure, in which rising expenses outpace revenue, as the students cease to enroll or have the capacity to pay enough.
But non-profit institutions are in their own world of hurt as well. According to Higher Ed Dive, 18 have announced their closure this year so far. But 141 closed between 2013-14 and 2022-23—or roughly 8.4%.
That’s far shy of 25% (although, if enough for-profits keep closing, then we could still get to our prediction). But it also doesn’t take into account a few important factors:
1) Federal emergency relief money in the wake of COVID allowed many campuses to continue to operate that would have otherwise closed. That funding has now dried up—and the numbers through 2022-23 miss the true end of the federal money.
2) Adding in more recent closures means we’re likely around 10 % of private, non-profit colleges having closed since 2013–14.
3) The numbers of private, non-profit colleges closing are also likely to continue to increase, as the ripple effects of the disastrous FAFSA rollout from last year continues to impact colleges, and the demographic decline doesn’t begin until… next year.
And we still haven’t talked about mergers in higher education. Yes, mergers are less common than closures—blame presidents and boards of trustees holding on too long, regulators making the process unwieldy and long (roughly three years), and a lack of incentives to merge unlike in other sectors. But they will count as part of the ultimate total of college consolidations.
Add this all together, though, and the simpler question is this: If roughly 10% of private non-profits have closed in the past 11 years, given the looming challenges, do people earnestly think that 15% more off the 2013–14 number of schools—roughly 250 colleges—will not close or merge over the next nine years? To hit that number, that would be just 28 a year, or just over two a month. And again—the demographic decline hasn’t even hit in earnest yet.
When we turn to public colleges and universities, the picture looks different. It’s a truism to note that public colleges don’t shut their doors that frequently. Just four did from 2013–14, according to the National Center for Education Statistics (although Higher Ed Dive suggests the number is much higher).
Mergers is likely how consolidation will impact public colleges and universities—particularly regional schools in areas of lower or declining population. And indeed, consolidation has already been occurring—so much so that it’s sometimes hard to keep track.
The University System of Georgia has gone from 35 institutions to 26.
In 2017–18, the University of Wisconsin System consolidated its 13 two-year college campuses into seven of its comprehensive universities. UW Platteville’s branch campus, University of Wisconsin-Platteville at Richland; UW Milwaukee at Washington County, UW Oshkosh at Fond du Lac, UW Green Bay at Marinette, UW Milwaukee at Waukesha, and UW Oshkosh at Fox Cities have all effectively closed over the past couple years—even though they don’t count in official statistics, as this Inside Higher Ed piece makes clear. More consolidation conversations are taking place in the state.
Pennsylvania is merging six of its Pennsylvania State System of Higher Education institutions into two universities.
In Maine, the system didn’t technically merge or consolidate, but instead moved to a “unified accreditation” for the system. Which, yes, means that the system’s seven main campuses now operate under the same accreditation.
In 2023, Connecticut’s 12 community colleges merged into one.
In Louisiana, eight technical and community colleges merged campuses.
Recommendations have emerged once again to encourage combining New Hampshire’s community college and university systems. And Granite State College merged with University of New Hampshire in 2023.
Three universities merged to form Vermont State University.
By my rough, unscientific count of that sampling, that’s at least 60 institutions that we can add to the total.
And more trouble has been brewing at the newly-created Vermont State University. In October 2023, it announced plans to cut 10 academic programs, eliminate up to 33 full-time faculty positions, consolidate 13 other programs, and reconfigure another 11. That sounds like… restructuring. Which is happening at an increasing number of institutions.
West Virginia University. Several Ohio universities. A potential mass layoff at the University of Wisconsin-Milwaukee of tenured faculty. You get the idea.
These aren’t bankruptcies—or, in higher ed speak, financial exigencies—but they are restructurings of long-term contracts with key stakeholders (read: eliminating tenured faculty) to save money. How to count these in the prediction?
For now, let’s not and remain conservative. Because all of what’s documented here shows that we’re now past the 15% number of colleges consolidating, en route to 25%. And we might hit 15% 15 years from the original date of our prediction—not the 20 that I conservatively revised it to a few years back.
This piece was originally published on Forbes here.
