College Meltdown 2.0 is distinctly different than the College Meltdown that started in 2010.
The first wave of the College Meltdown (2010-2021) resulted in a slow and steady drop in overall US college enrollment, with dramatic losses among for-profit colleges and community colleges. Corinthian Colleges, ITT Educational Services, and Education Management Corporation were three large for-profit chains to close. Small private liberal arts schools and regional universities also experienced losses. More folks were moving into the growing educated underclass.
Elements of College Meltdown 2.0 include publicly held corporations. Click on the image to see the chart (Source: Seeking Alpha)
College Meltdown 2.0 comes as the Coronavirus becomes more manageable. However US fascism continues to advance, student loan debt is slowly approaching $2 trillion, and the 2026 enrollment cliff is just a few years away. This new wave includes remnants of for-profit colleges likeNational American University, Stratford University, South University, the Art Institutes, University of Phoenix (owned by Apollo Global Management), Career Education Corporation (aka Perdoceo), and DeVry University (owned by Cogswell Education) as well as national accreditor ACICS.
The largest element of College Meltdown 2.0 is federal student loan debt, which appears to be rising to an unsustainable level--as it hamstrings the lives of millions of families. When mandatory student loan payments resume (scheduled for May 1), long-term default rates may range from 30 and 50 percent. It also appears that at least $500 billion of the Federal Student Aid (FSA) student loan portfolio will be unrecoverable.
College Meltdown 2.0 also involves online program managers (OPMs) that service elite schools (2U), regional universities (Academic Partnerships), and subprime robocolleges (Zovio-University of Arizona Global and Graham Holdings-Kaplan-Purdue University Global).
Student loan servicers and private student loan companies (Maximus, Navient, Sallie Mae, Nelnet), publishers and other edtech enterprises (EducationDynamics, Chegg, Barnes & Noble Education, Coursera, and Guild Education) are implicated or at least entangled in the mess. Higher education accreditors and student loan asset-backed securities (SLABS) are also worth monitoring.
Over the past four decades, neoliberalism has reshaped higher education into a market-driven enterprise, producing what can only be described as a global College Meltdown. Once envisioned as a public good—a tool for civic empowerment, social mobility, and national progress—higher education in the United States, the United Kingdom, and China has been transformed into a competitive market system defined by privatization, debt, and disillusionment.
The United States: From Public Good to Profit Engine
Nowhere has neoliberal ideology had a more devastating effect on higher education than in the United States. Beginning in the 1980s, with the Reagan administration’s cuts to federal grants and the expansion of student loans, higher education funding shifted from public investment to individual burden. Universities adopted corporate governance models, hired armies of administrators, and marketed education as a private commodity promising personal enrichment rather than collective advancement.
The results are visible everywhere: tuition inflation, student debt exceeding $1.7 trillion, and the proliferation of predatory for-profit colleges. Elite universities transformed into financial behemoths, hoarding endowments while relying on contingent faculty. Meanwhile, working-class and minority students were lured into debt traps by institutions that promised upward mobility but delivered unemployment and despair.
The U.S. College Meltdown—a term that describes the system’s moral and financial collapse—is a direct consequence of neoliberal policies: deregulation, privatization, and austerity disguised as efficiency. The profit motive replaced the public mission, and the casualties include students, adjuncts, and the ideal of education as a democratic right.
The United Kingdom: Marketization and Managerialism
The United Kingdom followed a similar trajectory under Margaret Thatcher and her successors. The introduction of tuition fees in 1998 and their tripling in 2012 marked the formal triumph of neoliberal logic over public investment. British universities became quasi-corporate entities, obsessed with league tables, branding, and global rankings.
The result has been mounting student debt, declining staff morale, and a hollowing out of intellectual life. Faculty strikes over pensions and pay disparities underscore a deeper crisis of purpose. Universities now function as rent-seeking landlords—building luxury dorms for international students while cutting humanities departments. The logic of “student-as-customer” has reduced education to a transaction, and accountability has been redefined to mean profit margin rather than social contribution.
The UK’s College Meltdown mirrors that of the U.S.—a story of financialization, precarious labor, and the erosion of public trust.
China: Neoliberalism with Authoritarian Characteristics
At first glance, China seems to defy the Western College Meltdown. Its universities have expanded rapidly, producing millions of graduates and investing heavily in research. But beneath this apparent success lies a deeply neoliberal structure embedded in an authoritarian framework.
Since the 1990s, China’s higher education system has embraced competition, rankings, and market incentives. Universities compete for prestige and funding; families invest heavily in private tutoring and overseas degrees; and graduates face a saturated labor market. The result is mounting anxiety and unemployment among young people—known online as the “lying flat” generation, disillusioned with promises of meritocratic success.
The Chinese model fuses state control with neoliberal marketization. Education serves as both an instrument of national power and a mechanism of social stratification. In this sense, China’s version of the College Meltdown reflects a global truth: the commodification of education leads to alienation, regardless of political system.
A Global System in Crisis
Whether in Washington, London, or Beijing, the pattern is strikingly similar. Neoliberalism treats education as an investment in human capital, reducing learning to a financial calculation. Universities compete like corporations; students borrow like consumers; and knowledge becomes a tool of capital accumulation rather than liberation.
This convergence of economic and ideological forces has created an unsustainable higher education bubble—overpriced, overcredentialized, and underdelivering. Across continents, graduates face debt, underemployment, and despair, while universities chase rankings and revenue streams instead of justice and truth.
Toward a Post-Neoliberal Education
Reversing the College Meltdown requires more than reform; it demands a new philosophy. Public universities must reclaim their civic mission. Education must once again be understood as a human right, not a private investment. Debt forgiveness, reinvestment in teaching, and democratic governance are essential first steps.
Neoliberalism’s greatest illusion was that markets could produce wisdom. The College Meltdown proves the opposite: when education serves profit instead of people, it consumes itself from within.
Sources:
Wendy Brown, Undoing the Demos (2015)
David Harvey, A Brief History of Neoliberalism (2005)
Tressie McMillan Cottom, Lower Ed (2017)
The Higher Education Inquirer archives on the U.S. College Meltdown
BBC, “University staff strikes and student debt crisis,” 2024
Caixin, “China’s youth unemployment and education anxiety,” 2023
Although the National
Student Clearinghouse numbers won't be out until December, a cursory
look at news articles over the last month suggests that US higher
education enrollment will be down again in 2018-19.
Thousands of learning sites and campuses have closed over the last seven years, and the trend looks like it will continue. You can track the school closings here.
There are some notable rises in enrollment. North Carolina is seeing increases after making tuition affordable with its
NC Promise program.
Texas and
Utah are also likely to see continued gains in college numbers as more people move to their states.
At the risk of being tarred and feathered again by
education insiders, I am compiling a list of US colleges that are at financial
risk. I am well aware that there are hundreds of schools in trouble, and that this list just touches the surface.
Why should I present a preliminary list? Because
presently, students are not privy to college finances at private schools that
they plan to attend. And judging from the decision in the Mount Ida case, it appears that courts do not favor transparency and
accountability to help consumers.
This list does not includesubprime schools and it's not
in any way related to instructional quality or student outcomes. Many of these
schools are not even on the US Department of
Education's Heightened Cash Monitoring list.
I also apologize to anyone at a school with the same name as a school on the
list.* Three schools on the list, St. Gregory's University, Mount Ida
and Green Mountain College, have already closed.
Adrian College Alderson Broaddus College (bailed out by USDA)
American International College
Anderson University*
Anna Maria College
Ashland University
Azusa Pacific University
Baptist Bible College and Seminary (Clarks Summit University)
Becker College
Belmont Abbey College
Benedict College Bethany College (bailed out by USDA)
Bethel College-Mishawaka
Bethel University
Caldwell University
Campbellsville University
Carson-Newman College
Chaminade University of Honolulu
Chestnut Hill College
Colby-Sawyer College
Columbia College
Concordia College-New York
Concordia University-Chicago
Corban University
Dominican College of Blauvelt
Elmira College
Emmanuel College
Evangel University
Faulkner University
Felician University
Franklin Pierce University
Georgetown College
Green Mountain College (closed)
Immaculata University
Judson University
Keuka College
Keystone College
Lake Erie College
Lindsey Wilson College
Livingstone College
Long Island University-Brooklyn Campus
Long Island University-C W Post Campus
Malone University
Marian University
Martin Methodist College
Mary Baldwin College
Marygrove College
Marymount Manhattan College
Marywood University
MidAmerica Nazarene University
Midland University
Mount Ida College (closed)
Mount Olive College
Mount St. Mary’s University
Multnomah University
Newbury College-Brookline
North Carolina Wesleyan College
Notre Dame College
Nyack College
Oglethorpe University
Ohio Dominican University
Olivet Nazarene University
Ottawa University-Ottawa
Pace University-New York
Pacific Lutheran University
Pfeiffer University
Philadelphia Biblical University-Langhorne (Cairn University)
Prescott College
Quincy University
Regis College
Rider University
Rockford College
Rockhurst University
Roger Williams University Saint Gregorys University (closed)
Saint Joseph's College-New York
Saint Martin's University
Saint Mary-of-the-Woods College
Saint Peter's College
Saint Xavier University
Shorter University
Sierra Nevada College
Spring Arbor University
Spring Hill College
The College of Saint Rose
The Sage Colleges
Tusculum College
Union College*
University of Bridgeport
University of New Haven
Urbana University
Utica College
Westminster College*
Wheeling Jesuit University
Wiley College
Professionals in higher education may deny that a US College Meltdown is occurring, but that doesn't mean it's not here. Arguably, a few variables related to the phenomenon have improved since the economic downturn of 2008-2009, but that's not a return to a healthy situation. That's why I have written more than two dozen articles on corruption, dysfunction, and financial failures in American higher education to document the many facets of the meltdown.
When I speak of College Meltdown, I am referring to the slow-moving decline of US colleges and affiliated businesses, which includes the following variables: (1) increased student loan debt, (2) decreased gainful employment of those who matriculate, (3) declines in student returns on investment (ROI), (4) increased student loan non-repayments, (5) increased student defaults, (6) reduced college enrollment numbers, (7) declines in entrance standards, (8) reductions in college revenues and endowments at less than elite schools, (9) increased use of debt (bonds) to fund colleges, (10) reductions in instructional staff and instructional pay, particularly with the use of adjuncts, (11) increases in class size, (12) college program closing, (13) reduced student services (14) selling of institutional assets, (15) accreditation downgrades, (16) college consolidations, (17) institutional closings, and (18) reduced values and ratings of student loan asset-backed securities (SLABS) .
These College Meltdown Variables are influenced by a variety of macroeconomic and social variables, including: (1) age demographics, particularly the numbers of college age individuals, (2) family size, (3) family wealth, (4) state and local allocations to higher education, (5) federal allocations to higher education, (6) employment participation, (7) median and quintile personal income of Millennials, (8) K-12 preparedness for college, and (9) immigration numbers.
Bain Capital ( Denneen & Dretler, 2012) and the New America Fund ( Selingo, et al, 2013) argue that colleges are spending beyond their means, using outmoded teaching methods, becoming less accessible to students and their families, and refusing to be accountable for student graduation and default rates and “gainful employment” numbers.
In developing predictive models, analysts must consider the dynamic, somewhat unpredictable, and seemingly irrational nature of human behavior. For example, as more working class and middle class people recognize that college is a high risk investment for themselves and their families, a greater number should choose to opt out of school or delay college participation, choose community colleges for the first two years of schooling, or select other majors. But this may not always be the case.
[In 2017, we collaborated with Crush the Street on a video describing the College Meltdown.]
“Education is not merely a credentialing system; it is a humanizing act that fosters connection, purpose, and community.”
Origins
The College Meltdown began in the mid-2010s as a blog chronicling the slow collapse of U.S. higher education. Rising tuition, mounting student debt, and corporatization were visible signs, but the deeper crisis was structural: the erosion of public accountability and mission.
By 2015, the warning signs were unmistakable to us. On some campuses, student spaces were closed to host corporate “best practices” conferences. At many schools, adjunct instructors carried the bulk of teaching responsibilities, often without benefits, while administrators celebrated innovation. Higher education was quietly being reshaped to benefit corporations over students and communities — a true meltdown.
Patterns of the Meltdown
Enrollment in U.S. colleges began declining as early as 2011, reflecting broader demographic shifts: fewer children entering the system and a growing population of older adults. Small colleges, community colleges, and regional public universities were hardest hit, while flagship institutions consolidated wealth and prestige.
Corporate intermediaries known as Online Program Managers (OPMs) managed recruitment, marketing, and course design, taking large portions of tuition while universities retained risk. Fully automated robocolleges emerged, relying on AI-driven templates, predictive analytics, and outsourced grading. While efficient, these systems dehumanized education: students became data points, faculty became monitors, and mentorship disappeared.
“Robocolleges and AI-driven systems reduce humans to data points — an education stripped of connection is no education at all.”
Feeding the AI Beast
As part of our effort to reclaim knowledge and influence public discourse, we actively contributed to Wikipedia. Over the years, we made more than 12,000 edits on higher education topics, ensuring accurate documentation of predatory practices, adjunct labor, OPMs, and corporatization. These edits both informed the public and, inadvertently, fed the AI beast — large language models and AI systems that scrape Wikipedia for training data now reflect our work, amplifying it in ways we could never have predicted.
“By documenting higher education rigorously, we shaped both public knowledge and the datasets powering AI systems — turning transparency into a tool of influence.”
Anxiety, Anomie, and Alienation
The College Meltdown documented the mental health toll of these transformations. Rising anxiety, feelings of anomie, and widespread alienation were linked to AI reliance, dehumanized classrooms, insecure faculty labor, and societal pressures. Students felt like credential seekers; faculty suffered burnout.
“Addressing the psychological and social effects of dehumanized education is essential for ethical recovery.”
Trump, Anti-Intellectualism, and Fear in the Era of Neoliberalism
The project also addressed the broader political and social climate. The Trump era brought rising anti-intellectualism, skepticism toward expertise, and a celebration of market logic over civic and moral education. For many, it was an era of fear: fear of surveillance, fear of litigation, fear of being marginalized in a rapidly corporatized, AI-driven educational system. Neoliberal policies exacerbated these pressures, emphasizing privatization, metrics, and competition over community and care.
“Living under Trump-era neoliberalism, with AI monitoring, corporate oversight, and mass surveillance, education became a space of anxiety as much as learning.”
Quality of Life and the Call for Rehumanization
Education should serve human well-being, not just revenue. The blog emphasized Quality of Life and advocated for Rehumanization — restoring mentorship, personal connection, and ethical engagement.
“Rehumanization is not a luxury; it is the foundation of meaningful learning.”
FOIA Requests and Whistleblowers
From the start, The College Meltdown relied on evidence-based reporting. FOIA (Freedom of Information Act) requests were used to obtain internal communications, budgets, and regulatory filings, shining light on opaque practices. Whistleblowers, including adjunct faculty and staff at universities and OPMs, provided firsthand testimony of misconduct, financial malfeasance, and educational dehumanization. Their courage was central to the project’s mission of transparency and accountability.
“Insider testimony and public records revealed the hidden forces reshaping higher education, from corporate influence to predatory practices.”
Historical Sociology: Understanding the Systemic Collapse
The importance of historical sociology cannot be overstated in analyzing the decline of higher education. By examining the evolution of educational systems, we can identify patterns of inequality, the concentration of power, and the commodification of knowledge. Historical sociology provides the tools to understand how past decisions and structures have led to the current crisis.
“Historical sociology reveals, defines, and formulates patterns of social development, helping us understand the systemic forces at play in education.”
Naming Bad Actors: Accountability and Reform
A critical aspect of The College Meltdown was the emphasis on naming bad actors — identifying and holding accountable those responsible for the exploitation and degradation of higher education. This included:
University Administrators: Prioritizing profit over pedagogy.
Corporate Entities: Robocolleges and OPMs profiting at the expense of educational quality.
Political Figures and Ultraconservatives: Promoting policies that undermined public education and anti-intellectualism.
“Holding bad actors accountable is essential for meaningful reform and the restoration of education's ethical purpose.”
[In 2016, we called out several bad actors in for-profit higher education, including CEOs Jack Massimino, Kevin Modany, and Todd Nelson.]
Existential Aspects of Climate Change
The blog also examined the existential dimensions of climate change. Students and faculty face a dual challenge: preparing for uncertain futures while witnessing environmental degradation accelerate. Higher education itself is implicated, both as a contributor through consumption and as a forum for solutions. The looming climate crisis intensifies anxiety, alienation, and the urgency for ethical, human-centered education.
“Climate change makes the stakes of education existential: our survival, our knowledge, and our moral responsibility are intertwined.”
Mass Speculation and Financialization
Another critical theme explored was mass speculation and financialization. The expansion of student debt markets, tuition-backed bonds, and corporate investments in higher education transformed students into financial instruments. These speculative dynamics mirrored broader economic instability, creating both a moral and systemic crisis for the educational sector.
“When education becomes a commodity for speculation, learning, mentorship, and ethical development are subordinated to profit and risk metrics.”
Coverage of Protests and Nonviolent Resistance
The College Meltdown documented student and faculty resistance: tuition protests, adjunct labor actions, and campaigns against predatory OPM arrangements. Nonviolent action was central: teach-ins, sit-ins, and organized campaigns demonstrated moral authority and communal solidarity in the face of systemic pressures, litigation, and corporate intimidation.
Collaboration and Resistance
Glen McGhee provided exceptional guidance, connecting insights on systemic collapse, inequality, and credential inflation. Guest authors contributed across disciplines and movements, making the blog a living archive of accountability and solidarity:
Guest Contributors:
Bryan Alexander, Ann Bowers, James Michael Brodie, Randall Collins, Garrett Fitzgerald, Erica Gallagher, Henry Giroux, David Halperin, Bill Harrington, Phil Hill, Robert Jensen, Hank Kalet, Neil Kraus, the LACCD Whistleblower, Wendy Lynne Lee, Annelise Orleck, Robert Kelchen, Debbi Potts, Jack Metzger, Derek Newton, Gary Roth, Mark Salisbury, Gary Stocker, Harry Targ, Heidi Weber, Richard Wolff, and Helena Worthen.
Lessons from the Meltdown
The crisis was systemic. Technology amplified inequality. Corporate higher education rebranded rather than reformed. Adjunctification and labor precarity became normalized. Communities of color and working-class students suffered disproportionately.
Dehumanization emerged as a central theme. AI, automation, and robocolleges prioritized efficiency over mentorship, data over dialogue, and systems over human relationships. Rising anxiety, anomie, and alienation reflected the human toll.
“Rehumanization, mentorship, community, transparency, ethical accountability, and ecological awareness are essential to restore meaningful higher education.”
Looking Forward
As higher education entered the Trump era, its future remained uncertain. Students, faculty, and communities faced fear under neoliberal policies, AI-driven monitoring, mass surveillance, litigation pressures, ultraconservative influence, climate crises, and financial speculation. Will universities reclaim their role as public goods, or continue as commodified services? The College Meltdown stands as a testament to those who resisted dehumanization and anti-intellectualism. It also calls for Quality of Life, ethical practice, mental well-being, environmental responsibility, and Rehumanization, ensuring education serves the whole person, not just the bottom line.
Sources and References
Washington, Harriet A. Medical Apartheid. Doubleday, 2006.
Rosenthal, Elisabeth. An American Sickness. Penguin, 2017.
Skloot, Rebecca. The Immortal Life of Henrietta Lacks. Crown, 2010.
Nelson, Alondra. Body and Soul. University of Minnesota Press, 2011.
Paucek, Chip. “2U and the Growth of OPMs.” EdSurge, 2021. link
Ravitch, Diane. The Death and Life of the Great American School System. Basic Books, 2010.
Alexander, Bryan. Academia Next. Johns Hopkins University Press, 2020.
U.S. Department of Education. “Closed School Information.” 2016–2020. link
Federal Reserve Bank of New York. Student Debt Statistics, 2024. link
Wayback Machine Archive of College Meltdown Blog: link
As the United States moves deeper into the 2020s, the College Meltdown is no longer a speculative concept but a structural reality. The crisis touches nearly every part of the system: enrollment, finances, labor, governance, and the perceived value of a college degree itself. The forces fueling this meltdown are not sudden shocks but accumulated pressures — demographic contraction, policy failures, privatization schemes, student debt burdens, and decades of mission drift — that now converge in 2026 with unprecedented intensity.
The Waning of College Mania
For decades, higher education sold an uncomplicated dream: go to college, get ahead, and move securely into the middle class. This college mania was promoted by policymakers, corporate interests, university marketers, and a compliant media ecosystem. But the spell is breaking. Students at elite universities are skipping classes, disillusioned not only by campus turmoil but by the reality that a degree, even from a prestigious institution, no longer guarantees a stable future. Employers increasingly question the value of credentials that have become inflated, inconsistent, and disconnected from workplace needs.
Yet paradoxically, many jobs still require degrees — not because the work demands them, but because credentialing has become a screening mechanism. The U.S. has built a system in which people must spend tens of thousands of dollars for access to a job that may not even require the knowledge their degree supposedly certifies. This contradiction lies at the heart of the meltdown.
Moody’s Confirms the Meltdown: A Negative Outlook for 2026
Moody’s expects expenses to grow 4.4% in 2026, while revenues will grow only 3.5% — and for small tuition-dependent institutions, revenue growth may fall to 2.5–2.7%. In other words, the business model simply no longer works. Institutions are already turning to hiring freezes, early retirements, shared services, layoffs, and mergers. These austerity strategies hit labor and students hardest while preserving administrative bloat at the top, mirroring broader patterns of inequality across the U.S. economy.
Compounding the problem, federal loan reforms — particularly the elimination or capping of Grad PLUS loans— threaten universities that rely on overpriced master’s programs as revenue engines. Many of these programs were built during the boom years as financial lifelines, not academic commitments. The bottom is falling out of that model too.
[Image: HEI's baseline model shows steady losses between 2026 and 2036. And it could get much worse].
White-Collar Unemployment and the Broken Value Proposition
A new generation is confronting economic realities that undermine the old promise of higher education. Recent data show that college graduates now make up roughly 25% of all unemployed Americans, a startling indicator of white-collar contraction. The unemployment rate for bachelor’s degree holders rose to 2.8%, up half a point in a year.
If higher education was once treated as an automatic economic escalator, it is now a much riskier gamble — often with a lifetime of debt attached.
Demographic Collapse and Institutional Failures
The so-called “demographic cliff” is no longer a future event; colleges in the Midwest, Northeast, and South are already competing for shrinking numbers of high-school graduates. Some institutions have resorted to predatory recruitment, deceptive marketing, and desperate discounting — the same tactics that fueled the for-profit college boom and collapse.
Meanwhile, the FAFSA disaster, mismanagement at the Department of Education, and the chaos surrounding federal financial aid verification have caused enrollment delays and intensified uncertainty. Institutions like Phoenix Education Partners (PXED) are already trying to shift blame for their own recruitment failures and history of fraud onto the federal government, signaling a new round of accountability evasion reminiscent of the Corinthian Colleges and ITT Tech eras.
Student Debt, Inequality, and Loss of Legitimacy
Student debt remains above $1.7 trillion, reshaping the life trajectories of millions and reinforcing racial and class disparities. Black borrowers, first-generation students, and low-income communities bear the heaviest burdens. Many institutions — especially elite medical centers and flagship universities — are simultaneously cash-rich and inequality-producing, perpetuating the dual structure of American higher education: privilege for the few, precarity for the many.
Faculty and staff face their own meltdown. Contingent labor now constitutes the majority of the instructional workforce, while administrators grow more numerous and more insulated from accountability. Shared governance is weakened, academic freedom is eroding, and political interference is rising, particularly in states targeting DEI programs, history curricula, and dissent.
The Road Ahead: Contraction, Consolidation, and Possibility
The College Meltdown will continue in 2026. More closures are coming, especially among small private colleges and underfunded regional publics. Mergers will be framed as “strategic realignments,” but for many communities — especially rural and historically marginalized ones — they will represent the loss of an anchor institution.
Yet contraction also opens space for reimagining. The United States could choose to rebuild higher education around equity, public purpose, and social good, rather than market metrics and debt financing. That would require:
substantial public reinvestment,
free or low-cost pathways for essential programs,
accountability for predatory institutions,
democratized governance, and
a commitment to racial and economic justice.
Whether the nation takes this opportunity remains unclear. What is certain is that the system built on college mania, easy credit, and limitless expansion is collapsing — and Moody’s latest warning simply confirms what students, workers, and communities have felt for years.
The College Meltdown is here. And it’s reshaping the future of higher education in America.
Hundreds of smaller campuses on the verge of failure are likely to close in 2019. For example, National American University is likely to close more than 20 campuses in 2019.
Student loan debt continues to rise. In 2018, there was a
significant number of news articles disclosing the negative effects of
student loan debt on the lives of Millenials and their families. I have
posted several links at College Meltdown.
Student loan servicer Navient continues to promote college for high schoolers who are at higher risk for default and a lifetime of debt peonage.
Long-standing problems like the adjunct crisis and the savage inequalities of the US K-12 pipeline, show few signs of improving.
In 2013, Futurist Bryan Alexander aptly talked about peak college enrollment in the United States. And over the last decade or so, higher education enrollment has declined in almost every state. Now at least 18 US states have experienced enrollment drops greater than 20 percent--and five more are close to that threshold.
Enrollment declines are the result of several interrelated economic and demographic shifts. Reduced populations of college age people, economic distress, growing inequality, and migration are some of the interacting factors. College is expensive and time consuming for working folks.
While programs like College Promise can help with shoring up community college enrollment, they cannot make up for deep social and economic problems. Online learning has made school more convenient, but the quality and value of several of America's robocolleges(colleges largely free of full-time instructors) is often substandard.
For many working-class families, college is no longer perceived as the golden ticket to upward social mobility. And a growing educated underclass, based on their own personal experiences with underemployment and student loan debt, are skeptical about the value of higher education for their children--if they choose to have children. Many are not.
Without significant change, we estimate that the 2026-27 enrollment cliff is likely to put almost every US state above a 25 percent decline over the last 15 years. With another economic meltdown, the numbers could get worse without major reform--smart social reform--not reform that lines the pockets of the rich and powerful.
The Higher Education Inquirer has added three companies to its College Meltdown watchlist: Ambow Education (AMBO), SoFi (SOFI), and Adtalem (ATGE).
Leading the way is National American University Holdings (NAUH), which is down to less than $50,000 in cash. Ambow Education (AMBO) and Aspen Group (ASPU) are near penny stock territory and Barnes and Noble Education (BNED) and SoFi (SOFI) are also in deep financial trouble.
Declining share price is not the only factor to make the College Meltdown list. Government contractor Maximus (MMS), for example, is on the list for its predatory behavior with student debtors and its own workers, as well as its questionable contracts with the US Department of Education.
2U is identified for its fleecing of its clients (universities), end customers (students) and shareholders. In its last annual report, the company told shareholders that the number one risk was that it may never make a profit.
2U (TWOU) Shares have dropped 70 percent over the last year (Source: Seeking Alpha)
Shares of student loan refinance company SoFi (SOFI) are down 70 percent over the last year
(Source: Seeking Alpha)
Barnes and Noble Education (BNED) shares have dropped 66 percent over the last 6 months.
(Source: Seeking Alpha)
Aspen Group (ASPU) shares have declined 82 percent over the last year.
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