The Pulse of Higher Ed

By Jim Fong

In January 2025, the president issued an executive order freezing federal loans and grants, including Pell Grants and other student loans. While the order has since been rescinded, the damage was done. Moving forward, potential students will be wary about the frailty of college loans. There will be uncertainty as to whether college is affordable and carries with it a significant return on investment. The uncertainty of financial aid, coupled with the blotched FAFSA rollout of 2024, will leave many potential students sitting on the sidelines, just as many did post-pandemic.

While the executive order certainly did some damage, much of the damage had been done well before this. Colleges and universities were already teetering on the edge regarding confidence. In a recent Gallup poll^[i], just 36% said they had a lot of confidence or a great deal of confidence in colleges in universities … compare that to 57% in 2015. There are many reasons for this loss of confidence. Some say that it is a result of rising tuition not in alignment with the changing economy, while others say it is a politicization of higher education. Some employers have argued that college graduates aren’t adequately prepared for the workforce. Regardless, higher education has been in a precarious position post-pandemic. The executive order by the president is likely to have further eroded confidence.

There’s also a growing belief that not all good paying jobs require a bachelor’s degree. Many governors have implemented policies that have changed the requirements needed to qualify for state employment.  Young people have adopted influencer approaches to generating income. Many technology positions require certification only. These dynamics have also contributed to the belief that succeeding in a new economy does not require a degree and potential student debt often associated with it.

Another factor impacting confidence is innovation … are colleges and universities preparing future students adequately for the impending age of artificial intelligence and automation? Personally, I believe they are regarding AI literacy and fundamentals. However, one could argue that the skills, tools and competencies needed to succeed in an AI economy are not being adequately addressed, as they continue to evolve.

Lastly, we have the demographic cliff^[ii]. In 2024, the National Student Clearinghouse saw increases in Fall^[iii] and Spring enrollment for first-time students (corrected from their earlier reporting). This is likely a result of students who delayed attending college immediately post-pandemic. Regardless, 2025 marks the first year of the demographic or enrollment cliff. Experts have predicted that the demographic cliff alone may have an impact to the tune of a few hundred thousand lost enrollments annually by 2030.

Other events are also likely to impact the health of colleges and universities, such as the potential reductions of research grants and pressure towards DEI initiatives. It is also anticipated that the U.S. will lose the gains from the past two years from international students coming to campus. In 2024, we had 15.2 million undergraduate students come to our campuses or attend online. 

So, what can we as higher education professionals do?

1. We need to organize and collaborate beyond our existing walls. Colleges and universities will need to work more closely together, as should professional associations. Corporate providers, such as those producing Customer Relationship Management (CRM) and Student Information (SIS) systems, as well as Online Program Management (OPM) companies and others, will need to band together at a higher level with institutions and associations to advocate for policies that protect access to education and strengthen the role of colleges and universities in building a skilled workforce. Employers who are dependent on an innovative and consistent workforce will need to partner with each of these entities to support and lead a larger and louder voice on matters of higher education and training. A greater collective voice will help protect, as well as expand access and affordability for, future learners.

2. While the current undergraduate metric is 15.2 million students, higher education may have to shift its focus to revenue generation or a headcount that better acknowledges professional education and microcredentials. Given the current economic and political climate, diversifying the portfolio to incorporate more professional education and training may be merited. While potentially less profitable, microcredentials have a significant potential to address workforce needs of a rapidly changing economy.

3. Given inflationary pressures and the potential for less disposable household income in the upcoming years, more innovative or stackable approaches are merited to reach the adult and traditional learner. Committing to a 120-credit degree may be a bridge too far for many students. Even approaches such as what my colleague Amy Heitzman has proposed, the 90-credit applied bachelor’s degree, may also be a struggle for many. However, naturally stackable credit certificates may ease the financial burden while also providing more immediate milestones. Stackability also applies to the online graduate market, as there are significant opportunities to engage the over 50 million adults over the age of 25 with a bachelor’s degree as their highest degree earned.

4. Colleges and universities are going to need to invest in corporate relationship management beyond traditional giving and fundraising. Direct employer partnerships will become more essential in this changing economy. While many UPCEA member institutions have marketing and enrollment management units, few have full-time corporate relationship managers.

5. We are going to need to communicate and engage potential and current students better. Many current institutional CRM systems were built with the Millennial or Gen X’er in mind. Today’s learner requires colleges and universities to rethink the market and how to engage potential students. With less traditional students, our systems will need to adapt to the many adult learner segments. As automation and artificial intelligence continue to improve, there will be potential improvements on student engagement, marketing and enrollment management that will positively impact conversion rates.

I anticipate that, with the demographic cliff, a more difficult economic environment and declining confidence with higher education, we have the potential to dip into the 14.6M-15M range in 2025. However, an institution’s health may not be fully dependent on credit enrollments. Improved revenues from professional education can help offset credit losses, while improvements made through technology could help on the cost side of the equation. Regardless, we have a greater need to band together and share best practices, just as we did during and after the pandemic. Our situation is challenging, but by working together and staying strong, we can overcome it!

[i] Gallup Poll. https://news.gallup.com/poll/646880/confidence-higher-education-closely-divided.aspx

[ii] Grawe, N. Demographics and the Demand for Higher Education, 2018.

[iii] https://nscresearchcenter.org/current-term-enrollment-estimates/