Financially struggling liberal arts colleges are probably already extending offers of admission to today’s 18-year-olds. If we leave aside the top 30 schools, would a young person be taking a huge risk by investing four years of his/her/zir/their life at a liberal arts college? Gone are the days when an American worker will spend an entire career at one company. Imagine the graduate of such a school applying for a job at age 50, exactly the age at which employers are believed to discriminate against older workers. It will be 2058. The school that was financially weak in 2026 will have shut down in 2035 and won’t be putting our PR about how great the school is. The hiring manager will therefore likely never have heard of the degree-granting institution on the resume. By contrast, University of ***pick your favorite state*** will always be there so long as there is someone to tax in that state. The hiring manager will have heard of University of AnyState if for no other reason than that university’s sports teams will be on television.
“What’s Lost When Liberal Arts Schools Close” (New York Times, October 2025):
The demise of Wells College has become a familiar story. In the 19th century, pioneers and religious seekers built a constellation of private colleges across the Northeast, South and Midwest. Now these schools are steadily blinking out. The Council of Independent Colleges, a national trade association, had 658 members at the beginning of the fall 2023 semester. Over the next two years, it lost 18 colleges to closure and three to merger, adding to the dozens that had already closed over the previous decade.
Many liberal arts schools closed because they couldn’t recover from the pandemic. Others couldn’t keep up with the arms race for expensive amenities that students have come to expect. And all were early victims of a problem that is about to wash over the entirety of American higher education: not enough applicants.
The year before the 2008 financial crisis, there were 4.3 million babies born in the United States, the highest number in history. Last year, there were only 3.6 million. The birthrate decline that began in 2008 lit an 18-year fuse on a college freshman slump that starts next year. Many highly selective schools are getting more applicants by the year, meaning that the enrollment crisis will continue to burn through mostly small colleges for decades to come.
From a Texas A&M report, which mostly shows that forecasters aren’t very good at forecasting (huge change from 2017 to 2023!):
(I’m not sure how this number can be forecast by anyone, no matter how intelligent. If the president of the U.S. can by executive order either open or close the border then there is no way to predict the number of immigrants and, therefore, no way to predict the number of children of immigrants.)
The Federal Reserve Bank of Philadelphia put out a moderately gloomy analysis:
Still doubt the population size would make a huge difference unless you’re a polyamorous billionaire trying to justify his lifestyle. It was quite difficult to find a lot of information 40 years ago without formal education. Not so today.
From the Federal Reserve paper:
> We then show that modern machine learning techniques, combined with richer data, are
far more effective at predicting college closures than linear probability models, and considerably more effective than existing accountability metrics.
“Give me an ‘A’! (‘A’) Give me an “I”! (‘I’) What’s that spell? (‘AI’) Yay — quit team quit!” (I grew up reading the Federal Reserve Bank of Kansas City publication Economic Review, instead of comic books, which shaped my sense of humor.)
When I chose a college 40 years ago, I unfortunately made the decision based far more on what other people thought of the university than how good of a fit it would have been for me. AI probably would have just made it worse. I hope they are opening trade schools for plumbers and electricians on the empty campuses.